Leif Swanson

Mortgage interest rates continue to stay low and break records.

Let’s take a look at the power of lower interest rates:

What would a $190,000 loan cost you in monthly payments (principle & interest only) during the past few decades?

$1592/month back in 1975 when rates were 9.05%

$2073/month back in 1985 when rates were 12.43%

$1441/month back in 1995 when rates were 7.93%

$1179/month back in 2005 when rates were 5.87%

$1003/month in 2010 when rates are averaging 4.36%

Low interest rates + low home prices = incredible opportunity

Let’s look at mortgage interest rates over the past 35 years.  Click on chart to expand.

For Sale:  Phoenix Home In the Desirable Arcadia Area

4826 E. Calle Redonda, Phoenix, AZ 85018

3 Bedrooms Plus Den - 2 Bathrooms - 2,538 Square Feet

Clean, cared-for home with original charm in Arcadia.  Spacious lot with views of Camelback Mountain.

Lush landscaping in the back yard.  8,651 square foot lot.

Highly rated Scottsdale Schools (Hopi Elementary, Ingleside Middle School, and Arcadia High School).

Built by Allied Homes.  These homes were built to last.  I grew up in Arcadia and lived in the same Allied home for 24 years. I attended Scottsdale schools K-12 (including Ingleside Middle School).

Original charm in the kitchen.  There’s also a 19′x13′ family room, a 15′x11′ den, an 18′x8′ Arizona room, and a 15′x’12′ storage room.

To see the MLS listing, click here.

To see the visual tour, click here.

Listed for only $465,000.

For Sale:  Beautiful Home At the Pointe Tapatio (near 7th Street & Peoria)

754 E. Becker Lane, Phoenix, AZ 85020

3 Bedrooms - 3 Bathrooms - 1,985 Square Feet - 2-Car Garage

Tastefully decorated for the Southwest. Looks like it comes from Sunset Magazine.

Spacious home with lots of natural light throughout.

Mountain views all around. This is the view from the front yard. The house is located on a private cul-de-sac lot.

If you love desert living, you’ll love living here. Quiet back yard that spills out to a desert wash (arroyo), so no neighbors immediately behind you. Lots of desert cacti and plants plus citrus trees too.

Convenient master bedroom downstairs. There are also two balconies (one is 18′x13′!)

To see the MLS listing, click here.

To see a visual tour of this home, click here.

Listed for only $255,000!

This funny looking bar code is a trendy way to advertise a website to techno-savvy people.  Instead of your normal bar code for pricing, a QR code (short for Quick Response) allows someone to take a photo of it with their SmartPhone (e.g., Blackberry, iPhone, Palm, Droid), which then takes them to the appropriate website.

Here’s the QR code for my website, www.LeifSwanson.com.

You’ll start to see more and more of these QR codes in magazine & newspaper ads.  Some of the fancier ones are in color.

Today’s buyers are too busy to worry about painting and cleaning their new home. They want move-in ready homes. Time spent on painting, new flooring, and staging by sellers is well worth it. Sellers will sell their homes quicker and for more money. This living room does not give a positive first impression. Looks like a gym, a bachelor pad, and/or a fixer-upper. Dusty coffee table. Dirty front door and air vents too.

See what new flooring and fresh paint can do to a living room? This Chandler, Arizona home even has similar looking sofas to the photo above. $500 probably got this seller $5,000 more. And if the house sells quicker, that’s less money spent on taxes, insurance, and utilities, which means more money in the seller’s pocket.

Please pick up your clothes before selling your home. Buyers want bedrooms to be retreats from the stress of daily living. And some would like bedrooms to convey a sense of romance too.

Much nicer bedroom. Clean and tidy and peaceful. Turning on lamps adds a soft, warm glow to the room as well.

Believe it or not, the holiday season will be here soon enough. Buyers will be thinking about hosting parties & dinners in their new homes. They will have a hard time imagining a holiday dinner if a dining room doesn’t look like a dining room. There should be a dining table here, not a foos table or pool table.

Here is a beautiful dining room of a Peoria, Arizona home that I sold quickly. Buyers can see there’s plenty of room for large groups. It looks clean and inviting.

Today’s buyers want bathrooms to be light and bright and clean-looking. They don’t want dark and depressing bathrooms. Or ones with dreary, heavy, outdated wallpaper.

This remodeled bathroom in Chandler, Arizona pleased my client enough to write an offer right then in the house.

Phoenix Metropolitan Area Real Estate Statistics - July 2010

What is happening with the real estate market in the Phoenix metropolitan area? What changed in July 2010?

[click on the charts to expand]

1) SALES: July 2010 had sales of 7,100, which was lower than July 2009’s 9,095 sales. 85% of the sales in June were homes, 14% were condos, and <2% were manufactured housing.

16.6% of the Phoenix metro area MLS listings sold in July, which was down from last month and from last year’s 24%. 17% of the home listings sold in July; only 10% of the condos sold; 9% of manufactured homes sold.

Bank-owned foreclosure properties accounted for 39% of the sales in July 2010; a year ago, 53% of the sales were bank-owned.

41% of the total sales in July 2010 were cash. A year ago, it was 36%.

30% of the sales were with FHA or VA financing. A year ago, it was 33%. Many of the first-time home buyers using the tax credit were FHA or VA buyers; the majority of these sales occurred in April-June, so it was expected to see this percentage decrease in July and for upcoming months. As a result, the percentage of cash sales increased.

2) SALES PRICE: The average sales price in July 2010 decreased to $176,141. But July 2010’s average sales price was higher than July 2009’s average by $800. Sales prices are at levels seen in 2002.

The median sales price in July 2010 decreased to $125,000. It was the same as July 2009, which gives us the fifth consecutive monthly year-over-year non-decrease since July 2006. The Phoenix metropolitan area real estate market bottomed out in early April 2009. We’re seeing a decline in median sales price so far in August.

75% of the sales in July 2010 were below $200,000, 83% under $250,000, 88% under $300,000, and 92% under $350,000. These percentages have remained steady for many months now.

3) INVENTORY: The absorption rate (the # of months’ inventory available for sale) is also known as inventory. The absorption rate in July 2010 was up to 6 months from 4.5 months last month. A balanced buyer-seller market is six months. The absorption rate in July 2010: 5.8 months for homes, 7.0 months for condos, and 11.3 months for manufactured homes. Therefore, it is a balanced market for homes in the Phoenix metropolitan area.

4) AVERAGE DAYS ON MARKET: Phoenix area homes took 80 days to sell in July 2010.

Condos took 85 days in July 2010 (101 days in June 2009). This was the lowest level since July 2007. Investors turned their attention to bank-owned condos selling for under $60,000. This in turn helped the average & median sales prices to decline.

5) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in July 2010 was 95.8%, which was less than July 2009’s 96.2%. We expected to see this number increase, actually, as some first-time tax credit buyers outbid each other. A normal market has sellers keeping 97.5% of their final list price.

6) PENDING SALES: Pending sales are a great indicator of future sales. Foreclosure and short sale listings are leading the way with pending sales. The pending sales numbers dropped considerably in August 2010 as the last of the first-time homebuyers tax credit buyers closed escrow. We are at 10,025 pending sales on August 17th (16,879 if you include the contingency contracts). We expect the pending numbers to decline in the upcoming months. Pending sales reached an all-time high of 15,402 on April 29th. When you add in the contingency contracts, the current combined number of properties under contract on April 29th was 23,630, an all-time record. We can attribute this to the first-time home buyer tax credit deadline.

7) PRICE PER SQUARE FOOT: $90 per square foot in July 2010 was a slight decline. It is the same as July 2009.

8 ) VACANT HOMES: An unprecedented number of Phoenix metro area MLS active listings still are vacant. Sold homes have an even higher number of vacancies. Vacant properties went up to 74% of all properties sold in July. The vacancy rate of sold properties in July 2009 was 81%! The normal is under 40%, however.

9) ASKING PRICE VERSUS SOLD PRICE: What is the difference between asking prices and sold prices? The average new list price in July 2010 was $198,715. This was $29,000 less than July 2009’s average new list price. And the lowest amount in ten years.

The median new list price in July 2010 was $130,000, which was $10,450 less than July 2009. It is also the lowest median new list price in ten years. We can contribute an influx of cheap bank-owned condo listings to this decline.

10) SHORT SALES: 24.6% of all MLS sales in July 2010 were short sales, which is the highest percent ever. The success rate of a short sale listing actually selling was 16.8% in July 2010, better than the success rate of all sales; this is only the fourth time ever that this has happened. The chart shows the rise in short sales in the past two years.

Phoenix Metropolitan Area Real Estate Statistics - June 2010

What is happening with the real estate market in the Phoenix metropolitan area?  What changed in June 2010?

[click on the charts to expand]

1) SALES: June 2010 had sales of 9,278, which was lower than June 2009’s 9,325 sales. 85% of the sales in June were homes, 14% were condos, and <2% were manufactured housing.

22% of the Phoenix metro area MLS listings sold in June. 23% of the home listings sold in June; 18% of the condos sold; 12% of manufactured homes sold.

Bank-owned foreclosure properties accounted for 37% of the sales in June 2010; a year ago, 57.5% of the sales were bank-owned.

38% of the total sales in June 2010 were cash. A year ago, it was 37%.

34% of the sales were with FHA or VA financing. A year ago, it was 33%.

2) SALES PRICE: The average sales price in June 2010 increased to $179,957. June 2010’s average sales price was higher than June 2009’s average by $8,400, a 5% gain. Sales prices are at levels seen in 2002.

The median sales price in June 2010 decreased to $127,417. But it was 2% higher than in June 2009, the fourth consecutive year-over-year increase since July 2006! The Phoenix metropolitan area real estate market bottomed out in early April 2009.

75% of the sales in June 2010 were below $200,000, 83% under $250,000, 88% under $300,000, and 91% under $350,000. It may not appear significant, but these percentages all dropped 1%, which has not occurred in two years. It shows that more higher priced homes sold in June 2010.

3) INVENTORY: The absorption rate (the # of months’ inventory available for sale) is also known as inventory. The absorption rate in June 2010 was 4.5 months. A balanced buyer-seller market is six months. The absorption rate in June 2010: 4.3 months for homes, 5.5 months for condos, and 8.1 months for manufactured homes. Therefore, it is a balanced market for homes in the Phoenix metropolitan area.

4) AVERAGE DAYS ON MARKET: Phoenix area homes took 78 days to sell in June 2010. Condos took 87 days in June 2010 (104 days in June 2009).

5) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in June 2010 was 96.01%, which was less than June 2009’s 96.35%. We expected to see this number increase, actually, as some first-time tax credit buyers outbid each other. A normal market has sellers keeping 97.5% of their final list price.

6) PENDING SALES: Pending sales are a great indicator of future sales. Foreclosure and short sale listings are leading the way with pending sales. The pending sales numbers remain high in July 2010, despite the June 30th first-time home buyers tax credit deadline. We are at 11,025 pending sales on July 16th. We expect the pending numbers to decline in the upcoming months. Pending sales reached an all-time high of 15,402 on April 29th. When you add in the contingency contracts, the current combined number of properties under contract on April 29th was 23,630, an all-time record. We can attribute this to the first-time home buyer tax credit deadline.

7) PRICE PER SQUARE FOOT: $91 per square foot in June 2010 remained unchanged, but is $3 more than June 2009.

8 ) VACANT HOMES: An unprecedented number of Phoenix metro area MLS active listings still are vacant. Sold homes have an even higher number of vacancies. Vacant properties accounted for 71% of all properties sold in June, the lowest since May 2008. We are seeing a decline in vacant properties as more traditional sales (non-foreclosure) take place. The vacancy rate of sold properties in June 2009 was 82%! The normal is under 40%, however.

9) ASKING PRICE VERSUS SOLD PRICE: What is the difference between asking prices and sold prices? The average new list price in June 2010 was $204,581. This was $25,500 less than June 2009’s average new list price.

The median new list price in June 2010 was $132,500, which was $13,000 less than June 2009.

10) SHORT SALES: 24% of all MLS sales in June 2010 were short sales. The success rate of a short sale listing actually selling was 24% in June 2010, better than the success rate of all sales; this is only the third time ever that this has happened. 2,250 properties sold via short sale in June 2010 versus only 1215 in June 2009 and only 207 in June 2008. The chart below compares short sale and all sale success rates.