I am a big fan of investment property and “second” homes. While the population of Arizona continues to grow and baby boomers begin to retire, Northern Arizona becomes an even more attractive place to invest in your future. While we have several great second home communities, many of them will only hold a limited amount of people. As the demand grows for this limited supply, it makes sense that the “value” goes up. Another great way to look at “value” is to consider the relaxation factor of getting away with family and friends. Although I am pretty sure that I will never live in a place where I have to shovel my drive way on a regular basis, it is pretty nice to be able to visit cooler weather.
With the weather beginning to cool off, I know many of you are looking forward to snow skiing. Northern Arizona offers many communities that are a short drive to snow skiing. Over the years, our family has owned property in Payson, Munds Park and, most recently, Flagstaff. I have worked with agents in several of these areas and would be more than happy to guide you in the right direction if you too are interested in owning a second home. Remember, if you are heading up north OR across the country, “Just Call Nick”, and I’ll be glad to help you make good decisions wherever you go!
Monday, October 30, 2006
Unrealistic Expectations Hanging on
Sep/Oct newsletter article..
Unrealistic Expectations Hanging on
Several times last year I wrote about the unrealistic real estate market that we were experiencing. The “dot-com” mentality that a home “should” appreciate by $10-20k per month was mind boggling. As a listing agent, it was kind of fun to help people sift through ridiculous offers and advise them how to maximize their situation. Many buyers who were not paying cash or waiving contingencies were left on the sidelines watching the market pass them by. Well, it has been about a year since the crazed bidding wars have disappeared and we are now in a much more normal market.
Yes, I know, the newspapers are saying that it is doomsday, but that is because they like to sell stories. Remember, in most situations, home ownership is a great idea. In years past, people would be happy with 5 or 6% appreciation in a year. The whole 10% a month thing isn’t gonna happen again any time soon.
Many “sellers” are kicking themselves for not selling last year and trying to price homes at those crazy prices. It is funny to see how many homes are on the market that people bought 3 years ago and list today at $300k higher. Many of these people feel insulted when an offer comes in $50 below their asking price. Let’s face it, the run up did some good things for many people and it helped create jobs, sales tax revenue, and a large surplus in revenues for our state. But, homes normally take more than an hour to sell and that is ok, too. The market always dictates the price of a home - good, “bad”, or otherwise. The good news is that with the easing market, buyers have a chance to get back into the “game.”
Unrealistic Expectations Hanging on
Several times last year I wrote about the unrealistic real estate market that we were experiencing. The “dot-com” mentality that a home “should” appreciate by $10-20k per month was mind boggling. As a listing agent, it was kind of fun to help people sift through ridiculous offers and advise them how to maximize their situation. Many buyers who were not paying cash or waiving contingencies were left on the sidelines watching the market pass them by. Well, it has been about a year since the crazed bidding wars have disappeared and we are now in a much more normal market.
Yes, I know, the newspapers are saying that it is doomsday, but that is because they like to sell stories. Remember, in most situations, home ownership is a great idea. In years past, people would be happy with 5 or 6% appreciation in a year. The whole 10% a month thing isn’t gonna happen again any time soon.
Many “sellers” are kicking themselves for not selling last year and trying to price homes at those crazy prices. It is funny to see how many homes are on the market that people bought 3 years ago and list today at $300k higher. Many of these people feel insulted when an offer comes in $50 below their asking price. Let’s face it, the run up did some good things for many people and it helped create jobs, sales tax revenue, and a large surplus in revenues for our state. But, homes normally take more than an hour to sell and that is ok, too. The market always dictates the price of a home - good, “bad”, or otherwise. The good news is that with the easing market, buyers have a chance to get back into the “game.”
Where do we go from here?
Here is a post taken from our Sept/Oct newsletter:
Where do we go from here?
The big question everyone seems to be asking these days is “where is our market headed”. Anyone that can tell you that, should also be able to give you six really good lottery numbers as well.
The fact is, there are literally hundreds of things that are going to effect our future. I attended the Economic Outlook forum at the Biltmore last month. Industry “experts” from several fields of expertise spoke (Elliot Pollack, RL Brown, etc.). The overall feel that I got was very positive based mainly on our state’s job growth and population increases. The commercial and industrial speakers were also positive regarding their industries. One item of concern was the current inventory levels of new and resale residential real estate. I do agree with RL Brown that the builders went a bit overboard with the lotteries and huge waiting lists. They had hundreds of people on waiting lists and planned to build a huge number of properties based on these lists. When the market began to come back to reality, many of these lists disappeared, leaving large inventories that they need to get off of the books. The result actually makes it a good time to buy a new home, as incentives and pricing are very aggressive. On the resale side it’s tough to compete with the big boys, but I believe our market will correct itself and be pretty healthy for quite some time.
Where do we go from here?
The big question everyone seems to be asking these days is “where is our market headed”. Anyone that can tell you that, should also be able to give you six really good lottery numbers as well.
The fact is, there are literally hundreds of things that are going to effect our future. I attended the Economic Outlook forum at the Biltmore last month. Industry “experts” from several fields of expertise spoke (Elliot Pollack, RL Brown, etc.). The overall feel that I got was very positive based mainly on our state’s job growth and population increases. The commercial and industrial speakers were also positive regarding their industries. One item of concern was the current inventory levels of new and resale residential real estate. I do agree with RL Brown that the builders went a bit overboard with the lotteries and huge waiting lists. They had hundreds of people on waiting lists and planned to build a huge number of properties based on these lists. When the market began to come back to reality, many of these lists disappeared, leaving large inventories that they need to get off of the books. The result actually makes it a good time to buy a new home, as incentives and pricing are very aggressive. On the resale side it’s tough to compete with the big boys, but I believe our market will correct itself and be pretty healthy for quite some time.
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