Today I want to talk about something that’s coming back into our market, and that’s companies that pay cash for real estate.

I won’t list the names of all the companies out there that are making cash offers on properties, but I will mention some of the techniques and strategies they use that you need to be aware of.

Many times, I’ll be on a listing appointment with a seller and I’ll give them a suggested list price based on what other similar homes are selling for in the neighborhood. That seller will then tell me that an investment company offered them an all-cash offer for the exact same price. Why, then, should they list the home for, say, $300,000 when they already have a $300,000 cash offer?

Here’s why: a lot of these companies will take a commission off of the price they offer. In addition, they’ll charge a convenience fee. They’ll also then do a full-blown home inspection on your property and ask you for a credit in lieu of all repairs for the home.

At the end of the day, sellers who sell to these companies end up getting an average of 10% to 15% less for their homes at closing than what they were promised up front.

The only time it would make sense for a seller to sell to one of these companies is if the home needed a lot of work and they don’t have the funds to fix it up or they need to sell the home now because they’re in a bad financial situation and need cash immediately.

I can understand in that scenario why someone would entertain an offer from an investor or an investment company. In today’s hot seller’s market, though, it doesn’t make sense for a seller to not put their home on the market and get full retail value for it. Why give your hard-earned money to an investment company when you can put it in your own pocket for your financial future?

If you have any questions about selling your home now or selling to an investment company and you want to have a more detailed conversation, don’t hesitate to call me. If you have any other questions or real estate needs, feel free to reach out to me as well. I’d love to speak with you.

How was the April 2018 real estate market? Let’s take a look at the numbers, compare them to 2017’s numbers, and discuss why right now is a great time to buy and sell.

In April 2018, we had 10,674 homes come on the market compared to 10,518 last year. That is a 1.4% increase. Active inventory was 20,218 homes this year. Meanwhile, last year there were 21,678. This is a 6.8% decrease in the number of active listings.

There were more total sales this year than last. The total sales numbered 9,162 compared to last year’s 8,828. That is a 3.7% increase in the number of homes sold.

The month’s supply of inventory has dropped again. We were looking at 2.46 last year while this year it is only 2.21. What do all these numbers mean? Well, basically, we are looking at fewer homes on the market for sale, but more homes are selling.

Interest rates have been going up. The National average is currently at about a 4.5% on a 30-year fixed mortgage. For a 15-year mortgage, the rate is at about 4%.

Buyers are purchasing now because they have been watching rates go up over the last six to nine months. They realize that as prices continue to rise because we have limited inventory and rates continue to rise, payments are rising. They must make the decision whether they get involved not or wait, and risk being priced out of the market.

If you have never bought a home and are looking to buy now, lock the rate now. If rates should drop in the future, you can always refinance. If rates continue to escalate, you will have your rate locked in so that your payment is set.

If you are in a home now and you are considering trading up or down, I would suggest doing it now while we are in a seller’s market. You want to lock in your interest rate, because it determines how much you pay for the home over the next 30 years.

If you have any questions or concerns or want to talk with me about real estate in your area, please call me or send me an email. I look forward to speaking with you soon.

If you’ve watched this channel in the past, you know I’ve talked about investing in real estate. I wanted to cover that topic today in a bit more detail.

I’m sure you’ve seen books, YouTube videos, and commercials about how you can get rich in real estate. I’ve been investing in real estate since 2003 and it’s been a great investment for me, personally. I’m not going to give you any investment advice, however. You’ll need to seek a financial advisor for that.

There are four legs of real estate:

1. Appreciation. Historically real estate has gone up in price over the long term.

2. Depreciation. Owner’s depreciate the property on their taxes (check with your CPA).

3. Principal Pay Down. The tenants pay of your mortgage.

4. Cash flow. Money left over after debt service and operating expenses.

Many Americans have built their wealth through real estate. If you’re interested in getting involved with real estate investing, I have some great books to share with you that you should check out before you get started.

“The Millionaire Next Door” talks about the millionaires in America and how they’ve built their wealth. I learned in this book that a majority of millionaires in America made a majority of their money in real estate.

If you love numbers and crunching them, check out “What Every Real Estate Investor Needs to Know About Cash Flow… And 36 Other Key Financial Measures.” I’d be happy to talk about you with this book even if you want to skip reading it.

The simplest but most profound book I’ve read about real estate investing is “The Automatic Millionaire Homeowner: A Powerful Plan to Finish Rich in Real Estate” by David Bach. There are a lot of powerful examples in here about building long-term wealth.

If you have any questions for us about real estate investing or real estate in general, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.

Here’s how the latest year-over-year statistics from our Phoenix market compare between March 2017 and March 2018:

-The number of new listings dropped from 12,200 to 11,402.

-The number of active listings dropped from 22,100 to 20,356.

-The number of sold listings rose from 9,357 to 9,612.

-The month’s supply of inventory dropped from 2.36 months to 2.12 months.

As you can see, sales are up, inventory is down, and there aren’t as many new listings coming onto the market. What’s interesting is interest rates have escalated since last year, but at the same time, home values and sales are both rising as well. This is because buyers want to lock in a rate now before they get even higher. If rates rise too high, these buyers will get priced out of the market and not be able to afford what they really want to purchase.

There’s a scramble among these buyers to buy now, so if you’re looking to trade up, now is a great time to do it. If you’re looking to buy your first home, now’s a great time to lock in a low rate before they increase even further.

If you have any questions about our Phoenix market or you’re thinking of buying or selling a home soon, don’t hesitate to reach out to me. I’d love to help you.

Whether you are hiring a Realtor to help you buy or sell a home, there are a few red flags and pitfalls to look out for.

The most common thing I see when people have tried to sell a home and it didn’t work is that they hired a friend or family member to sell their home. While hiring a friend or family member isn’t always a bad idea, you need to make sure that the person you are hiring is full-time and has a lot of experience.

It’s important to keep in mind that 87% of Realtors in Maricopa County are either new, part-time, or have been in the business for less than five years. When you hire a real estate agent, you need to make sure that they are selling at least 100 homes a year before you hire them to work for you.

You should also find out if your agent has training and certification in contract negotiation. I am a certified negotiation expert. Less than 1% of agents in the U.S. have that certification. In fact, real estate school doesn’t teach agents anything about negotiation. They teach you how to fill out a contract and a counteroffer but not how to negotiate and defend your seller’s equity. That’s extremely important.

In fact, our clients are getting an average of 2% more for their homes than the average Realtor in the MLS because all of our contractors are negotiated by certified negotiation experts.

Finally, make sure that the agent you hire charges at least 6% commission. Why? There are a number of agents who charge less than 6%, but those agents are doing what I call a “list and leave.” They put the home on the MLS, stick a sign in the front yard, and wait for a buyer to show up.

The problem is that it takes a lot longer to sell their home because no marketing is being done. The longer the house sits on the market, the lower the offers will be. The seller might have saved 1% or 2% on commission, only to lose 3% to 5% on the sale price because the home took too long to sell and there was no marketing being done, causing the seller to leave a lot of equity on the table.

If you are looking to buy or sell out of state, let me know. I am part of a network of the top 1% of agents in the United States. I can find you a great Realtor through the RE/MAX referral network.

I would love to talk to you more about what you need to look for when hiring a real estate agent. If you have any questions, just give me a call or send me an email.

Now that February is behind us, it’s time to take a look back at the latest market statistics from that month.

In February of 2018, we saw 9,721 new listings come on the market. This is a 3% decrease from what we saw in February of last year, when the number of new listings was 10,016.

As for the total number of active listings, we had 20,711 on the market this February compared to 22,305 in February 2017.

There has been a 7% increase in the number of homes sold, with 7,019 listings having sold in February of 2018 and 6,529 having sold in February of last year.

Also, inventory has dropped. This February we had 2.95 months’ worth compared to last year’s 3.42 months. This is a 16% decrease in supply.

Due to our low supply and high buyer demand, most of our local markets currently favor sellers. Buyers are still highly motivated, despite the fact that rates have gone up, rising from about 3.5% last year to 4.25% this year. Buyers are concerned that if they don’t buy a home now, they’ll be subject to even higher rates later on in 2018.

In fact, the Fed has hinted that they may be raising rates as many as four times this year.

Whether your real estate plans are to buy or to sell, I recommend making your move as soon as possible. There’s no way to be sure what the market will do, so don’t put off your real estate plans any longer.

If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.

Hopefully, you’ve had a happy 2018 so far! Today, I’d like to fill you in about what happened in the real estate market this past January.

We had 10,389 homes come on the market this year, as opposed to the 10,316 the year before. With a 0.08% difference, there was pretty much no change.

There were 19,961 active listings in January 2018. This was a 9.7% decrease from the previous year, which had 21,909 listings.

Six thousand one hundred and sixty-one homes sold on the market this year, constituting a 2% increase in the number of homes sold.

Inventory went down from 3.63 months last year to 3.24 months this January—a 12% drop.

It’s still a seller’s market. Rates have been going up, and they’ve actually hit the highest level they’ve been since 2014. However, they’re still really, really low.

We’re seeing a lot of buyers coming into the market to purchase homes, but there aren’t enough homes for sale. They naturally want to lock in the rate while it’s low, so if you’re thinking about buying a home, now is a great time. If you’re thinking about moving, do it as soon as possible so you don’t run the risk of it going higher in the future.

For any questions about buying or selling, please feel free to contact me at 602-738-9943.

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Today I’d like to talk to you a little bit about stock market volatility and how it impacts the real estate market.

When the stock market is going up, people tend to be more optimistic. That results in higher spending and a stronger real estate market. When the stock market goes down and starts to get choppy, people are less likely to spend and less likely to get involved in real estate. As fewer buyers come on the market, we start to see inventory climb.

The stock market has been really good for us this year, but things have started to get a bit more choppy recently. The interesting thing is that buyers are still buying at an aggressive clip. We put 30 homes under contract last month on our team alone.

As of right now, the Phoenix market remains strong. Buyers are still buying, unemployment remains low, and optimism is high. If you want to know more about the market, what your home might be worth, or anything else about real estate, don’t hesitate to give me a call or send me an email today. I look forward to hearing from you soon.

Today I wanted to quickly touch on a few changes to the tax code, as well as recent changes to loan limits. Before I get started, let me just say that if you’re looking for tax or financial advice, seek out a qualified professional. I’m not a CPA or a financial advisor.

Right now you need to know that the loan limits have increased for FHA, conventional, and VA loans. This means that more buyers are going to be entering the market, more buyers are going to be selling and trading up to a higher-priced property, and we’re going to see more market activity in general. More activity leads to higher home values, which is great news for homeowners.

You’ve also probably heard a lot about the recent tax code shift. You used to be able to deduct the interest on your loan up to the first $1 million on a property you’ve purchased, but that limit has now dropped to $750,000.

The property tax deduction is now being capped right at $10,000. That won’t affect most Arizonans, but it will affect homeowners in higher-taxed states like California, New York, and Illinois. I wouldn’t be surprised if we saw a lot of retirees selling their properties and moving to lower-taxed states like Arizona. I wouldn’t be shocked if we a saw a real boom in the market from that. This is the busiest January I’ve seen in 18 years in Phoenix. I anticipate a really great market in 2018.

If you have any questions for me about the market or anything else about real estate in general, give me a call or send me an email anytime. I look forward to hearing from you.

Want to know what your home is worth? Get a FREE home value report
Want to look at homes on the MLS? Search all homes for sale
Want to see more videos? Subscribe to my YouTube Channel!

What happened in the December 2017 real estate market? What can you expect from our real estate market in 2018?

In 2017, 6,146 homes came on the market in December. In December 2016, 6,579 homes came on the market, leaving us with a 6% decrease in 2017.

In December 2017, there were 20,461 homes available for sale. Compared to the 22,449 homes available for sale in December 2016, that’s a 9.7% decrease in active inventory.

The number of sold homes increased by 0.8% year over year, from 7,128 sales in December 2016 to 7,185 sales in December 2017.

In December of 2016, there were 3.15 months of inventory on the market, which decreased by 10.5% to 2.85 months of inventory in December 2017.

What do all of these numbers mean for our market?

There were fewer homes coming on the market for sale, and we had a 10% decrease in active inventory. We did have a slight increase in the number of homes sold, but inventory is down, leaving us with a seller’s market.

Why?

For one thing, interest rates are below 4%. Interest rates have gone up slightly, so buyers realize that as rates go up, their payments will go up. As a result, they want to lock in that low rate now, while it’s still below 4%.

The stock market is booming and the economy is roaring, causing homebuyers to think, “Prices are going to go up, so I’d better lock in the current price now.”

What does all of this mean for the 2018 market here in Phoenix?

I anticipate 2018 to be one of the hottest markets on record, and it’s off to a great start.

In January, we get about 10,000 new homes on the market. From now until May, there will be 10,000 to 12,000 homes going up for sale each month, so get your home on the market now before your neighbors do.

If you have any questions about buying or selling a home in 2018, please don’t hesitate to reach out to me. I would be happy to help you!