Friday, March 25, 2016

What $300,000 buys in the East Valley

The Valley of the Sun is a big area - somewhere in the neighborhood of 900 square miles. (For comparison, Washington DC is about 75 square miles and the State of Rhode Island is about 1,500.) And as can be expected for an area of that size, there are significant differences between different neighborhoods - styles, communities, and yes - prices.

Today I thought I'd take a look at what a $300,000 house looks like in different parts of the East Valley.



Programming Note - upcoming change in format

Before we get started, I have a major announcement regarding my website and this newsletter.

Beginning next month, I will be separating this newsletter from my website, creating a true newsletter - whose content is distinct and unique, and will only be distributed via email. The name will change as well; it will no longer be called Viewpoint.

For the last several years I've published these articles on my website at ThePhoenixAgents.com, and the website has emailed them to you as the "Viewpoint" through the magic of rss technology.

In summary - you will still receive the same great newsletter you've come to expect, only it will have a different title and will only be available through email.

And now, back to the East Valley...



Before we look at the homes, let's discuss the parameters - how exactly did I choose these homes?
  • I pulled (from ARMLS) all the Single Family Detached homes that sold in February for each city.
  • If the city had more than one home which sold for exactly $300,000, I chose the home which sold the fastest as my example.
  • If the city did not have a home sell for exactly $300,000, I chose the home which sold closest to, but not above, $300,000.
  • If the home looked like a statistical outlier in some way and did not represent other homes from the same price range and area, I skipped it in favor of the next home which matched the above.

The Results - What does $300,000 buy in:

Scottsdale
  • 2,100 square feet on an 11,000 square foot lot
  • 3 bedrooms / 2 bathrooms
  • Built in 1968
  • Swimming pool
  • Bank-owned / Foreclosed property
  • 13 days on the market
  • Located west of Loop 101 between Indian Bend and McDonald






Mesa
  • 2,400 square feet on a 10,000 square foot lot
  • 3 bedrooms + den / 3 bathrooms
  • Built in 1995
  • 135 days on the market
  • Located southwest of Greenfield and Brown






Gilbert
  • 2,900 square feet on an 8,000 square foot lot
  • 4 bedrooms / 3.5 bathrooms
  • Built in 1988
  • Swimming pool
  • 45 days on the market
  • Located east of McQueen between Warner and Elliot






Queen Creek
  • 3,200 square feet on a 12,000 square foot lot
  • 4 bedrooms + den + loft / 3 bathrooms
  • Built in 2004
  • 35 days on the market
  • Located east of Ellsworth and Rittenhouse






Conclusion

These four homes are very different; so are the four neighborhoods. Year built, size of house (and yard), and the quality of appointments (cabinets, counter tops, fixtures, hardware, etc.) stand out the most. Using size as the most basic measurement, the homes get larger as you get further away from the center of the Valley: 2000 ft in Scottsdale, 2400 ft in Mesa, 2900 ft in Gilbert, and 3200 ft in Queen Creek.

I also see differences in the quality of the MLS photos - for example, the Mesa house's kitchen picture appears to be a large family-style kitchen, but if you look closely there are only 5 tiles between the edge of the picture and the kitchen island. The photo was taken with a camera lens that makes it look much larger.

Considering it can be upwards of a 2-hour drive from one corner of the Valley to the other (think Surprise to Queen Creek), where you buy can have a profound effect on what you think about the "Phoenix area."

Please give Cheryl or myself a call-email if you have any questions about different areas, or if you want to see more photos of certain neighborhoods. We can set up an MLS search for you to see all the listings of a specific area, based on whatever criteria you choose.

Thank you for reading,

Chris Butterworth

Note - All photos are copyright of ARMLS (Arizona Regional Multiple Listing Service). All data is believed to be accurate but not guaranteed. Home sizes and lot sizes may have been rounded.

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Friday, February 26, 2016

Keeping a Clean House - the simple way, part 3

This is Part 3 of a 3-part series discussing some of the habits of people who always seem to have a clean house, regardless of when you might stop in. (You can read Part 1 and Part 2 of the series here.)

It's important to understand with all of these habits, that these are not "things to do in order to clean your house" or "extra steps needed in order to clean your house." These are simply habits that people have - people whose homes are generally clean.

These habits are more about time-shifting - doing things you will have to do at some point anyway, but doing them sooner and with more regularity. They're about changing your mindset to one where cleaning isn't a giant evil chore, but instead a simple completion of the current activity.

And with that, let's take a look at three more habits people with clean homes practice:

6.) Put your clothes away, everyday

When you get home from work, you change into your 'casual hanging out around the house clothes', right? But what do you do with your work clothes?

People who keep clean homes put them away. Dirty clothes go into the hamper. Jacket, belt, and tie get hung up. Shoes go back in the closet, and anything that might be worn again before being cleaned gets hung up or folded and put away.

The other clothes that get put away everyday are the newly folded laundry. Since you're doing laundry everyday, your clean clothes pile shouldn't be very big, so it's easy to put these few items away.

The payoff for Putting Your Clothes Away Everyday: No piles of dirty clothes lying around on the floor, no piles of clean clothes stacked to the ceiling and sitting on top of your dresser, and no confusion about where a particular piece of clothing might be.

7.) Clean as you go

People with clean homes tend to think of cleaning up as the final part of the task, rather than keeping it as a separate chore to do later.

Dinner - Clean the prep area and dishes while the main course is in the oven, and you only have to worry about half the mess after dinner is over. Clean up immediately after dinner (which shouldn't be too hard since your dishwasher was emptied in the morning), and you finish the night with a clean kitchen.

Projects, Games & Activities - Finish one (which means cleaning up and putting it away) before you get into the next one. And this one holds even more true for the kids - getting them into this habit will help keep your home cleaner as well as giving them a headstart on keeping clean as they get older. Board games, crafts and scrapbooks, sports equipment, homework - it all falls into the same pattern: get something out, play with or use it, and then put it away. Lather, rinse, repeat.

The payoff for Cleaning as you Go: Less clutter, and less cleaning chores to do. Spending a few seconds (board games) to a few minutes (dinner prep dishes) doesn't feel like much of a task, especially compared to a Saturday "power cleaning session" where you have to make a day out of the same work.

8.) Nighttime routine

You ate dinner, spent some family time together, watched a little tv, and helped the kids get ready for bed, before finally getting a chance to relax and unwind for the evening. People with clean homes use a few minutes of this time to finish up their day (tying up any loose ends) and prepare for tomorrow.

Picking out clothes to wear tomorrow, making tomorrow's lunch, and taking a walk through the house to tidy up and maybe turn off a light that had been left on or putting away a cup that had been left on the counter; these are all simple routines - things which don't take a lot of time or energy, but which are much easier to do without the time-stress-crunch of late-for-work or late-for-school of the morning.

The payoff for a Nighttime Routine

It's difficult to overstate how much calmer and easier some of these tasks are in the quiet of a late night house compared with the hectic stress of a running-late morning. Not only are the tasks themselves made simpler and more relaxing, but they now free up that much more time in the morning, which leads to less stress and less hectic mornings. It's a win-win.


These habits of people with generally clean homes, just like those we discussed in Part 1 and Part 2, are more about doing small tasks frequently compared with waiting around for a large chore to be required.
Spending one minute each day may be the same as spending seven minutes on the weekend, but you don't have clutter around the house when you do it each day, and you don't have to waste your weekend on cleaning chores.

I would even argue the larger chore will take more time than all the smaller tasks combined, due to lost pieces, confusion, or even stuck-on dirt and grime.

I hope you give these a try - hopefully you can get into a few of (or all of) these 8 habits. Your home will be forever cleaner if you do.

- Chris Butterworth

This was Part 3 of a 3-part series. Read Part 1 and Part 2 here.

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Wednesday, February 10, 2016

Real Estate Pricing - has the market recovered?

It's been a full year since I pulled some statistics from the ARMLS database and took a detailed look at pricing trends. In the meantime, I've had conversations with multiple people recently centered around the price of their home as compared to what it would have sold for "at the peak". Obviously, that seems like a good place to start looking around.

From Peak to Valley to Comeback?

The Phoenix real estate market peaked in August, 2006, as far as the lightning fast, white hot, crazy market went. Prices, however, continued to rise for another several months.

Once prices started dropping in 2007, they dropped fast and far, before bottoming out in late 2009 or early 2010.

For comparison purposes, I pulled sales data from the 4th Quarter of 2006, 2009, and 2015. This should give us a good read of where we've been and where we are currently.

Median Sales Price

Chart showing 4th Qtr 2006, 4th Qtr 2009, and 4th Qtr 2015 - for several cities in the East and West Valley. (click to enlarge)


It's clear that prices have rebounded a long way from the bottom, with a few cities' prices approaching their 2006 peak.

Here's the table containing the data, for those analysts out there.


Median Price per Square Foot

Same time frames, same cities, but this time we'll look at the price per square foot, as this will adjust for changes in prices due to larger or smaller homes being built over the last 10 years.



Well, the charts aren't identical to the Median Price charts - the 2015 numbers haven't rebounded quite as high as the median prices' chart. This means that homes are larger than they were in years past. But it doesn't change the trend; the peak-valley-rebound images are very similar to the previous charts.

Number of Homes Sold

Once again we'll pull the same time periods and cities, only this time we'll put pricing aside and just look at how many homes have sold.



What does this chart tell us? No, seriously, I'm asking you.. I've looked at these numbers two dozen times, and I'm not sure what they're saying, other than to point out that Phoenix is far and away the largest city in terms of housing units.

Some cities are relatively flat over all three periods, while others vary wildly, but I don't see a relationship to east-west, north-south, big-small, landlocked-outskirts, socioeconomic, etc.

Summary and Forecasting

What does all this mean? Well, that's the million dollar question.

Prices have been rising for seven years in a row, and they're getting close to peak levels in some cities. At the same time, I'm not sure how much wages have been rising. I know lots of people who are making the same amount (or less than) they made a decade ago, and not too many who are making significantly more. (although some of this is gut feeling, since I don't have access to everybody's current salary.)

It does feel as if employment levels have stabilized. I remember a time a few years ago when a job posting on craigslist brought about a hundred resumes on the first day. These days I know a couple companies who have had a harder time finding good help.

Last year I was worried about interest rates, or at least that there was so much more room for rates to increase compared with the opportunity for rate reductions. And what happened? Several countries' central banks have moved interest rates negative - banks have to actually pay interest to keep surplus money on hand!

I'm not smart enough to figure out what is going to happen next, but I can say this is a strange economic environment - one we've never seen before. And I still think interest rates have more room to increase than to decrease. (The next chart below is from last year's post, showing how much an interest rate change can affect monthly payments.)



Final Advice

I'm not going to tell you whether to buy, or sell, or what city is "hot", or anything else you should be doing with your investment dollars.

I'll simply advise to be careful. Cover your bets. Make decisions based on well-crafted plans. Don't be surprised if the market doesn't do exactly what you expected it to.

And give Cheryl and myself a call if you have any real estate needs! (that's my best advice, after all.)

- Chris Butterworth

* All data was pulled from the Arizona Regional MLS system, for Single Family Residence detached homes which successfully closed escrow between October 1st and December 31st of 2006, 2009, and 2015. Data is believed to be accurate but not guaranteed.

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