Tiffany Cloud's Arizona Blog

musings from 35 yr AZ resident and Realtor®

A Random Act of being Neighborly – Taking the Lead in Protecting Your Neighborhood’s Value

I read an article today that I found fascinating.  It was just a little snippet of an article, only 4 short paragraphs.  It was entitled, “Survey:  Well-Kept Yards Most Important Factor in Determining Neighborhood Safety.”  The survey conducted by relocation.com , reported by RIS Media and sponsored by Lowes, found that,  “75% of Americans believe the most important factor in determining a neighborhood’s safety is the up-keep of surrounding homes, especially the front lawns.”  The Chairman and Founder of Relocation.com was quoted as saying, “It’s interesting to see how home buyers determine neighborhood safety based on the neighborhood’s appearance and not as much based on police statistics or crime reports.” As a Realtor® who happens to have a foreclosure or two in my own neighborhood, I couldn’t help but think how the increase in distressed homes in our neighborhoods is a variable that we can’t control.  What used to be an anomaly, has become the norm.

For a couple of years the government has been trying to stop the downward spiral that is our housing market.  The government has infused billions of dollars into housing programs, kept interest rates low, shored up the banks making real estate loans and offered cash incentives for home buyers.  Yet, we still find that foreclosures top the news on a daily basis and that more and more people are either being forced out of their homes or are voluntarily walking away from homes.  The phenomenon is no longer something we hear about on the news, but one we drive through everyday on our way to work as we exit our neighborhoods…. our very own neighborhoods.

So what about our neighborhoods?  What about the value of our homes? What about those homes that sit with the lawns overgrown, leaflets stacking up at the front door, empty driveways and that eerie sense of abandonment we drive past everyday?   My Grandmother used to say that asking the right questions was often the beginning of the finding the right answer.  If my Grandmother was right ,and she almost always was; the internal questions we ask ourselves as we drive past these abandons homes could be the key to the solution.

When is the government going to fix this housing crisis so my housing value stops free-falling?

or

Is there anything I can do to stop the value of my homes decline?

 

When is someone going to start taking care of that home?

or

Is there anything I can do to take care of that home?

 

Could the answer be as simple as a random act of being neighborly?  What if you cleaned up that yard?  Maybe a neighbor seeing you work on the yard would offer to help, or maybe they might do it in a week or two?   What if neighbors took turns occasionally parking their cars on the street out in front of the home lending a ‘presence’ to the home? What if several neighbors got together and made a rotating schedule of when they would do some front yard maintenance?  [Although it irritates me to no end to have to make this side note, I must.  I am not a lawyer and I can’t give legal advise – but you do need to have a property owner’s permission before trespassing or working on another’s property and you do need to be aware of the fact that there might not be any kind of homeowner’s insurance policy on that home. Don’t give up easily though, contact some local authorities to see if there is a way you can work around such a dilemma.  Is there a neighborhood task force that the City helps underwrite and insure to clean up these properties?  If not should there be one…hint, hint, hint? Contact the bank that own the property, contact the local health department if there is garbage left, see if a local boy scout troop could do a clean-up….Let’s think outside of the box folks, this is important.  There, done – now back to the benevolent spirit of this post]

Starting with abandoned homes is a great first step, but let’s take it a step further, a BIG step further.  What about those homes in your neighborhood where there are still people living in them and you see them start to deteriorate?  Oouch, that is a lot harder.

We had a home in our neighborhood that has always been maintained start to go into dis-repair.  I knew something must be going on because for 6 years the home had always been maintained.  My gut reaction was that I needed to check in with these neighbors and see if everything was OK; but then I immediately started talking myself out of it.  They might think I am being nosy, what if they think I just want to gossip to the other neighbors? What about their privacy?  What business is it of mine?  We had only ever chatted about our kids and the weather….I took a risk and called them up and as non-threatening as I could be, asked them if there was anything I could do to help.  I let them know that my attention was not to intrude, but that if they had some kind of need that I might be able to help with, I would sure like to know about it so I could help.  They were so relieved that I had asked. I was a little shocked at how relieved they were.  What followed was an hour-long conversation and several follow-up conversations after that.   It turned out that in fact there was something I could do to help, and 4 months later that yard looks better than it has in years.  Their mailbox has been replaced, the yard looks fantastic and those neighbors of mine have some hope again and they are taking pride in their home as they once had.  It made me feel really good.  The government couldn’t help my neighbors out, but I could and in doing so, I helped my whole neighborhood out.

I thought that worked out pretty good, so when the opportunity arose again a month later I again forced myself to take the initiative.  In another home just outside of my neighborhood I had seen an elderly gentleman struggle in and out of his car.  His whole property was in disrepair and had been for quite some time.  While I had often muttered to myself as I drove by that I wished he would clean it up, I had never stopped to ask myself, “Can he clean it up and might he need some help?”  So, I forced myself to stop one day when I saw him outside and chatted with him for a while.  I had never met or spoken with this man before.  We had a lovely conversation and I was able to at one point say to him, “You know I have been driving past here almost everyday and have always meant to stop.  You have a really large yard and I hope you don’t mind me asking if you need help with the yard or anything else?”  He very kindly told me he was,”good” and didn’t need any help.  I left feeling glad to have made the connection with him and to let him know that a neighbor cared about him.  Do you know that he was out there working on his yard not two days later with a big smile on his face?  Possibly he just needed to know that the neighbors cared and in turn that caused him to want to care about us back by cleaning up his yard a bit.  I actually have had several really good interactions with him since then and he has spotted me at the store since then and come over to say Hi and chat.  Not only did I make a new friend, but I also think that in the future if he ever does feel he needs some help, he might just be a little more willing to accept it from me or maybe feel comfortable enough to ask.

You decide... waiting for something or offering something.

I want to be a good neighbor, I love my neighborhood.  I want my kids and my family and my neighbors to take pride in our lovely neighborhood.  What starts out as a random act of being neighborly can morph into so much more.  Let’s take pride in our neighborhoods.  The responsibility for our neighborhoods start with us not the government or the banks.  Let’s start locally by loving on our neighborhoods again …. I dare you….

Tell me after reading this post… are the hands in this picture waiting for something to be given to them or are they outstretched to lend a hand to a neighborhood or neighbor in need?  You decide.

What other ways can you think of to impact your neighborhood for the good in this depressed housing market.  Please do share.

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November 16, 2010 Posted by | Arizona Ecomony, Arizona Housing Market, Foreclosure, home buyer, home seller, Neighborhood Tours, REALTOR | , , , , , , , , , , , , | Leave a comment

First-Time Home Buyer Tax Credit – Then & Now in the Greater Phoenix Metropolitan Area. Part 1 of 3, The Void

Excluding certain military personnel, the First Time Home Buyer’s Tax Credit has expired.  For all practical purposes we have been left with what amounts to a void in the Phoenix Area Housing Market.  I will need to cover this in three parts:

1.  A look at the immediate statistical summary and define our current ‘Void’.

2.  Project out and take a stab at the future and possible time tables for improvements and the factors that might and will play a role.

3.  Take a broader picture of the Housing Recovery in the Greater Phoenix Metropolitan area (this is the good news, so don’t miss this one!).

The Void … The Why

Our Highest Recorded Pending Listings in this century occurred in the week ending April 28, 2010, approximately 1 month prior to the closing deadline for the first-time home buyer tax credit.  At the end of April we had 15,149 homes listed as pending or under contract in our Multiple Listing Service (Just for comparison purposes, as of September 13th, 2010 we had 10,009 pending listings).  With only 30 days left to get a deal closed, those that were looking to qualify for the tax credit had already made their decisions and had something under contract.  In addition, something else occurred that was counter productive to helping our housing market regarding the reporting of these pending listings.  Quite a large percentage of buyers had put multiple offers out on properties with the intention of only purchasing one or at least less than what they had made offers on.  In their effort to try to ensure they got ‘something’, they opted for the ‘insurance’ of having more than one choice available to them when the time came to choose.  When we got down to the wire of having enough time to get a deal closed (typically about 30 days) and they had to choose, many of these duplicate contracts were cancelled.  Since April we have obviously seen a dramatic decrease in pending listings.  We essentially had a FALSE demand that was created by these multiple contracts. When you have a greater demand, the supply goes down and of course the price goes up, or in this case, more precisely is artificially inflated by a false demand.  I can tell you first hand, that buyers were panicked, and here in Arizona we had bidding wars, escalation clauses and in some areas, inventory was down to less than a four month supply which is generally considered a Seller’s market.  We essentially had a mini-bubble for a few months.  Well, we have learned that bubbles eventually pop, and now that the tax credit is over, our market must now correct…. AGAIN.

The Void … The Data
  • According the The Cromford Report, the end of August had our current price per square foot for the Greater Phoenix area at $84.44/sqft, down from $91.12/sqft at the end of June.  That is a decrease of 7.9% since the tax credit has expired only 2 months prior.
  • Housing Data for Maricopa county has the current Median Sales price at $123,900 ($132,900 in June of 2010).  Prior to last year, which has so far been the bottom of our market for median sales price, the last time our median sales price was at $123,900 or below was in December of 2000.
  • Inventory is increasing weekly.  In the last 3 months, we have added over 3,000 listings to our inventory which now sits at 44,531 up from 41,483.  Inventory is up 9% in the last three months.
  • Three months ago closed sales per month were at 9,312/month.  Today closed sales are at 6,911/month.  Closed Sales have decreased 25.7% in the last 3 months.

The Void … The Reality

As I speak to my fellow Realtors in the Metro Phoenix area, most listing agents are reporting a huge reduction in their showing activity and price reductions are on the rise for their listings.  Buyer agents are consequently reporting buyers that expect ‘everything’.  I got the following from an agent with buyers that were seriously considering a listing I have in Power Ranch:

“I was really surprised but I think they [buyers] are just all over the place.  I will let you know what the outcome is but you should not have a hard time trying to sell that house. There is just a lot available out there for sale and not a lot of buyers who are serious about buying. I have never seen interest rates as low as they currently are and buyers just seem to want everything and if they can’t have it their way they don’t want it. Pretty fussy buyers with interest rates at their all time low!”

In April of 2009 we reached our  lowest median price this decade of $119,000.  Since then the market has been trending up for the most part.  We had gone from a low of $119,000 in April of 09’ to $134,900 just 12 months later in April of 10’.  The press had started to report things were looking up, and we started to hear some positive things happening in the housing market.  In just two months since the First Time Home Buyer’s Tax Credit has expired, we have almost voided out the last year gains. I suspect we will likely reach that low of $119,000 in Sept. or Oct. of 2010, and unfortunately there is a real possibility that we will  trend lower for a new all time low as inventory continues to increase.

in the next part of this series we will take a look at some of the factors that could influence the next 6 – 12 months in the Phoenix market.  Of course there will be speculation and I will be relying heavily on some folks that are quite a lot smarter than I.  In the third part of this series I will take a broader look at the housing recovery.   There is actually quite a lot of good news to report when looking at the broader picture.

Thanks for reading.

Information gathered from The Cromford Report, Arizona Regional Multiple Listing Service, edpco.com and Arizona State University Realty Studies.

September 14, 2010 Posted by | Arizona, Arizona Ecomony, Arizona Housing Market, home buyer, home seller, REALTOR | , , , , , , , , | Leave a comment

Why 7.1% Unemployment in Arizona is ‘Good’

Bureau of Labor Statistics
Image via Wikipedia

Of the states hardest hit by the housing bubble, Arizona’s unemployment rate is by far the lowest.  Historically Arizona has always benefited from a lower than average unemployment rate compared to the rest of the country.  When looking at the last 10 years statistics we had several years of 3-4% unemployment and average about 5%.  Yes, we are currently at a a decade high of 7.1% but that is still below the National average of 7.6% (Jan 2009), even though Arizona had the largest drop in home values in the nation for 2008 at 34%.  Think about it, with THE LARGEST DECLINE of home values in the nation wouldn’t one expect our unemployment rate to be much higher?

Let’s compare Jan 2009 Unemployment Rates in AZ to a few of the other states hit hard by the housing bubble:

Current Unemployment Rate

Difference from National Average

Highest Monthly Unemployment Rate from 1985-2008

Arizona

7.1% – .06% 7.7%

California

10.1 + 2.5% 9.9%

Florida

8.6% + 1.0% 8.9%

Nevada

9.4% + 1.8% 8.4%

– data Bureau of Labor Statistics

Do I suspect that the  Arizona unemployment rate might go higher?  Sure, most likely; but let’s keep the rate in perspective with the rest of the nation, the other ‘bubble states’ and the fact that we are #1 for housing decline in the nation.  Unemployment is bad.  7.1% in this economy??….I can live with that.

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March 12, 2009 Posted by | Arizona, Arizona Ecomony, Arizona Housing Market | , , , , , , , | Leave a comment