by MICHAEL BODEEN | Dec 15, 2015 | Bodeen Team Blog, Real Estate News
Drones Fight Wars and Sells Homes – Take a Look!
We’ve all seen how the American military has been utilizing robotic drones to help fight wars, especially in the Middle East. It has eliminated many Al Qaeda and Isis terrorist enemies without having to jeopardize allied “boots on the ground” which is another issue far too big for this discussion.
Personally and commercially, the use of drones today is controversial! The invasion of privacy is a big deal – it certainly is to me. Awhile back, Karen and I had a drone examining our backyard while we were there. It was, to say the least disconcerting even troubling. I can certainly see why many of these drones have been shot down by angry homeowners.
That being said…
From a real estate marketing standpoint, however, I sure see advantages. Jonathan and I recently experimented with drone marketing on a current listing we have, hiring my friend who had recently spent $4000 purchasing the drone. We felt good about the fee we paid as a marketing investment for this particular home which was on an acre parcel in North Phoenix. The views are terrific and we added the drone shots to go along with an interior video filmed previously.
Rather than describe this, why don’t you enjoy this. We’ve linked both interior and exterior drone shots below. Oh, and by the way, if you know of someone who might like this home, please send the links to them and have them call us. Our asking price is $644,500.
by MICHAEL BODEEN | Dec 7, 2015 | Bodeen Team Blog, Buying a Home, Real Estate News
Solid and Balances Market Continues
The good news is that the Phoenix Metro real estate market will surpass the last two years in many important categories including the number of sales, average and median sales prices, numbers of homes under contract and the time it takes to sell a home. The only bad news is that the good news is good news for sellers, not for buyers who find themselves still on the sideline.
Compared to 2013 and 2014, this year is doing well. Balanced is the term we’ve used consistently this past year which benefits both buyers and sellers. Some Examples:
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2015 |
2014 |
2013 |
| Active Listings |
19,601 |
23,579 |
22,043 |
| Listings Under Contract |
7,951 |
6,203 |
5,519 |
| Sold Listings |
75,574 |
66,448 |
64,855 |
| Median Sales Price |
$212,900 |
$200,000 |
$190,000 |
| Average Sales Price |
$268,791 |
$259,604 |
$252,052 |
| Days on Market (Sales) |
70 |
80 |
62 |
| Month’s Supply Inventory |
4.4 |
4.9 |
5.0 |
How Much Can You Buy?
Buyers Take Note!
The Phoenix Metro communities remain some of the most affordable in the nation. A recent article by mortgage firm HSH.com indicated Phoenix home buyers who make $43,836 can afford to buy the median priced home here, currently at $213,000. The mortgage payment on that priced home, per the article is $1023 per month.
When one considers the average cost to rent which is $1200 – $1377 per month, home
ownership begins to look pretty good.
Remember, the first place to start home shopping is through an excellent and reputable lender. Buyers will need a PQF (Pre-Qual Form) for us to give to the listing agent as part of the offer. Give us a call and we’ll be happy to recommend one of these professionals.
by MICHAEL BODEEN | Nov 30, 2015 | Bodeen Team Blog, Real Estate News
The Contingency Sale Part 3
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In the two previous installments concerning the Contingency Sale, we concentrated on how and why sellers should now be considering offers on their homes contingent on the buyer first selling their own home. We saw that the contingency sale is not new, but was a common method of selling a home before the market gyrations of the mid 2000’s to just a few years ago. Basically, our local real estate market has now returned to “normal.” And in a normal market, contingency sales are a viable and necessary tool we use to buy and sell homes.
Today we look at the buy side of the contingency sale to see how a buyer can best structure their offer to obtain the best possible response from the seller. After all, it’s no given that a seller will want to accept an offer contingent on the sale of the buyer’s home. Why? Because escrow risks increase as more properties (and buyers and sellers) enter the mix. The contingency deal states that if the buyer’s home doesn’t close for whatever reason, the buyer is not obligated to close on this home. Therefore “due diligence” homework is needful to ascertain the facts (hence, risks) that may surface to derail the deal.
To be able to get the best look from the seller, the buyer should have already found a buyer for their home, they’re in escrow with a pre-approved buyer, and they’re past the due diligence (inspections) phase on their home’s escrow. In other words, they’re just waiting to close without any known roadblocks.
But what if that’s not the case? What can a buyer do if they’ve found the house of their dreams, but their house has not sold yet? To be honest, this is not a strong position for the buyer. A buyer’s agent (on behalf of their client) must be able to convince the seller/seller’s agent why they’re better off taking this deal as opposed to another. First, we need to find out how long the seller’s home has already been on the market. If it’s been on the market for a long time (over 60 days) a seller will be more apt to consider it. Also, what is the buyer offering? I would recommend a full price (or more) offer, and all other terms and conditions to be seller beneficial. Whereas a low-ball offer will most likely be an insult to the seller and cease negotiations.
Another tool a buyer (or seller) can use is the “Contingency Release Clause.” The CRC basically allows the seller to continue to market the property and accept other offers subject to a 72 hour “right to release” the buyer’s contingency to close escrow on their home. The downside of this for the buyer is they may have to forego being able to buy this home if there is no other way to close the deal apart from selling their home. The dirty little secret however is that the seller is required to now list the home as “UCB” which stands for Under Contract, Back-Up Offers only. Most agents will not show these home to their buyers.
There is more that buyers and sellers can do accomplish their buy/sell goals using a CRC. If you or someone you know would like more information about real estate, please give us a call. We’re here to help. 602-689-3100.
Mike Bodeen
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by MICHAEL BODEEN | Nov 24, 2015 | Bodeen Team Blog, Real Estate News
The “total” housing supply of homes for sale in the Phoenix Metro region is well down from last year, which on the surface would seem to be not great news for buyers and good news for sellers. All of that decline, however is in the price ranges below $225,000, as illustrated by the chart below, which is for all areas & types:
Above the $225,000 price range, we now have more supply than at this time last year. Sellers should therefore be careful not to over-estimate their bargaining power if they are priced over $225,000. This is particularly true of price ranges over $1 million where demand has become much weaker since August.
This is encouraging news for buyers looking to purchase above $225,000. There is more supply available now than at this time last year in all the other price ranges. If you’re looking under $225,000 you will find that the selection is increasingly meager the lower your price range is below $225,000.
No matter the price range buyers, make sure that you’re pre-approved for a loan if you need one. The nicest homes no matter the price range are most often contested by other buyers.
by MICHAEL BODEEN | Nov 16, 2015 | Bodeen Team Blog, Buying a Home, Real Estate News, Selling a Home
2014 was one of the most balanced years in the Phoenix Metro residential real estate market according to Michael Orr’s (ASU) Cromford Index. One year ago the Cromford Index was just above “100” which Mr. Orr has determined to be a “balanced market” between supply and demand.
From that point the index steadily increased in 2015 favoring a seller’s market. The seller’s market that ensued reached an index of 148 during the first week of September just over two months ago. It has now steadily been decreasing and currently resides at 131. Remember, 100 is balanced, so this reversal only reinforces our market’s trend of maintaining balance.
For context, the Cromford index reached an incredible high of 308 back in April of 2005-which was the seller’s market of all seller’s markets. Just two years after that the index plummeted to its lowest point ever to 27 in October of 2007, a rabid buyer’s market. I can tell you that both of those markets were hell on steroids to work in.
In the near term, it looks as if balance will continue to prevail. Interest rates are remaining low, the number of buyers will remain about where it is now, and the supply of homes for sale is slightly increasing. For there to be meaningful change in any given buyer or seller direction will require an abundance of more buyers to send home prices higher, or a significant increase in the number of homes for sale to drive down values for buyers. From our vantage point we don’t see either of those events happening soon.
The major impacts however will be price based. The lowest price ranges (under $300K) will continue to be very strong for sellers. The highest price ranges, especially over $2,000,000 will not be kind to sellers. The moderate price range ($300K to $800K) should continue in, shall we say, a balanced sort of way.
If you or someone you know would benefit from our expertise, by all means have them contact us. We’ll be happy to help. It’s what we do! (602) 689 – 3100
Mike Bodeen
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by MICHAEL BODEEN | Nov 9, 2015 | Bodeen Team Blog, Real Estate News, Selling a Home
Last week’s blog discussed the increasing use of contingency sales where buyers’ offers are coming in “contingent” on the successful close of escrow of the buyer’s residence. This practice should not be automatically shunned as it has been over the past decade, but neither should it be readily agreed to without doing our homework.
This week I look at how the seller and their agent can diminish the negative risks of the contingency sale. Here are some basic safeguards that sellers can take to prevent getting stuck in a losing situation.
Mike’s best seller practices in order of safeguard:
- Should you take a contingency sale? The answer lies in the “honest” assessment about which home (yours or the buyer’s) has the greater likelihood to sell first. If your home has been languishing on the market with few or no offers and the buyer’s home that they need to close on will be a slam dunk quick sale, then certainly consider their offer. In all instances, you and your professional Realtor should do a thorough investigation as to the facts of the buyer’s current deal.
This includes interviewing the related parties to the transactions including agent, lender, and Title Company to determine the viability of the deal hanging together. Because if their deal falls apart, your deal falls apart and you get nothing (except angst) plus you‘ve lost time.
- Consider taking a contingency on a home if the buyer’s home is already in escrow, and through its “Due Diligence” (inspections) period including the negotiating period which can stretch out to 10-15 days or more. This assumes the buyer’s buyer does not also have a home to close on. You can allow this, but it’s very tricky. Much investigation needs to go into the quality of the other deals. This includes interviewing all other affected Realtors, lenders and title company officers and reviewing sale documents to make sure there’s no hidden hooks that can pierce the deal. I’ve been in escrows that have had up to four other homes that needed to close before my client’s home could close. These are possible, but harrowing and not for the faint of heart.
- Consider taking a contingency if the home just went into escrow and has not yet gone through its Due Diligence period. This can also work, but a few more questions need to be addressed about their property itself to determine if it should pass an inspection from the buyer. Again, this is a duty of you and your professional Realtor.
- Consider taking a contingency if the buyer’s home is NOT in escrow, if in your opinion and that of your Realtor’s, the buyer’s home is more likely to sell before yours. Is their home well priced, not unusually odd, in good condition, good location, etc. It’s still a matter of the odds. Your Realtor is usually best suited to make this determination.
Question: How long should you give the buyer’s to sell their home? It should be within one-two days of their closing. They will need to transfer funds to close on your home. The problem with #4 above is that it’s an unknown until they get their home in escrow. There should be a definite cut-off date.
Question: Can I accept another offer while under contract to sell to another? Usually not, unless you include a clause known as a “Contingency Release Clause.” This clause allows the seller the opportunity to take a new buyer’s offer after first giving the existing buyer the right to eliminate their contingency (72 hour right of refusal) and proceed to close escrow. This needs to be set up when the deal is first structured.
There are a number of other issues that should be addressed as well, but as you can see this is not something that should be either lightly accepted or rejected by a seller. There are a number of benefits in this package, but each deal needs to be weighed on its own merits. And as always, we recommend that buyers and sellers consider having legal counsel review these documents.
If you or someone you know would benefit from our expertise, by all means have them contact us. We’ll be happy to help. It’s what we do!
