Scott Whitwam, ABR, SFR, ASD, CDPD ,Realtor Mesa AZ

Why use a Mesa AZ Realtor® to help you search for and buy your next home? Reason number one is that it may just be in your best interest; consider this:

1. No cost to YOU. Buyer’s agent services should cost you ZERO!

When you hire a Mesa Realtor® it should cost you nothing as they will be paid from the seller.

2. Arizona is an agency state. There is a provision in the Arizona Constitution (Art 26) that allows

3. You are owed a fiduciary duty. – Your agent is obligated to keep your best interest above that of others in the transaction. real estate agents in AZ to provide certain legal services as it relates to a real estate transaction as your Agent.

Hire a Mesa AZ Realtor® and get all the benefits while the seller pays the bill.

Get a Buyer-Broker Agreement when hiring your Mesa AZ Realtor®! Why? Commitment

The Buyer-Broker Agreement commits your agent to you and you to your agent. This gives both parties an interest in succeeding. Your agent knows that they may have to put in days, week or months of effort to get paid -n- You want a responsive interested agent committed to helping you find the perfect home. Don’t be concerned about getting trapped with an agent that you don’t work well with; insist on a short term agreement or one with a cancelation clause. I like termination clauses; they allow buyer and agent to cancel if things don’t work out.

Thinking about buying a home and using a Mesa AZ Realtor® as a buyer agent? This week’s R.E. Scott Real Estate Talk radio program focused on buying real estate. With inventories shrinking over the last few months cities like Chandler, Mesa and Gilbert, prices are on the rise and competition has become fierce for some properties. Many times this can lead to buyer and Agent frustration as agents are frustrated because they are working hard and not able to get homes under contract and buyers are frustrated feeling their Realtor® is not focusing enough on getting them a home.

Get the home you want, use a Mesa AZ Realtor®... 5 Tips for buying in today’s real estate market – Listen to this week’s show click here.

The multiple listing service that covers the Maricopa County real estate market is ARMLS® (Arizona Regional Multiple Listing Service) covers a population of about 4 million people. One of the metric that is produced through ARMLS® is the “Pending Price Index”, which predicts future price over the next quarter based upon homes in Pending status.

One of the purposes for considering the Maricopa County real estate market future median and average value is so business can better plan their business strategies for the coming quarter. Using December figures the January stats showed an average sale price expectation of $160,900. This was a little over 4% lower than the actual $167,500 average sale price recorded. The median price prediction was also 2.5% off as prices continue to rise.

When predicting future values in the Maricopa County real estate market it should be noted that the farther out the predictions are the less accurate they become when compared with actual numbers after the fact.

The chart below show the forecast through April 2012, where it is indicating declining home values over the next quarter.

The Mesa AZ real estate market may be on the mend. Mesa is a city with a population of approximately 435,000 people making it the 38th largest city in the U.S. Mesa is considered a bedroom community by many even though there are some well know industries like Boeing & MD Helicopters and soon to be First Solar. The Mesa AZ real estate market accounts for a little more than 10% of the 4.1 million population covered by the Arizona Regional Multiple Listing Service (ARMLS®).

Median list prices for resale home listed in the MLS increased by 7.8% in January and the average list price for resale homes increased by 21.5%. By no means does this bring about an equal offset to the devaluation of Mesa AZ real estate since the crash but it is a positive change to the decline seen the last few years.

Certainly one or two month a trend it does not make but for Mesa AZ real estate it is a welcome reprieve. If nothing else has happened, there is a since of optimism in the industry. The chart below shows the year on year change in list price

With an upward move in new resale list prices the Mesa AZ real estate market like other cities covered under the ARMLS®, have also seen an uptick. The rise in sale price has not moved up as dramatically as list price but median sale price is up 2.6% and the average sale price is up 3.3%.

For homeowners in the Mesa AZ real estate market this will be seen as positive news. It has been years since homeowners have not been faced once again with loss in value. The chart below shows the year on year comparison of sale price to list price.

One way to track available inventory to demand is by calculating the month’s supply of inventory (MSI). MSI considers the amount of time it would take to sell all available inventories at the current sales rate. The ARMLS® shows MSI up from December to January by almost 3/4 of 1% to land at 3.88. Anytime the MSI is under 4 it is considered a seller’s market. Since these numbers are ARMLS® wide they do not take into account Mesa AZ real estate specifically.

When you adjust the Mesa AZ real estate market MSI to only include homes under $150,000 the number drops below 3. The chart below gives a good indication of the current markets MSI trend annual history.

The Mesa AZ real estate market has certainly turned in seller’s favor. Presuming that inventory stays consistent we should see a continued low level of foreclosures as days on market decrease and short sales receive contract quickly so lenders have sufficient time to process and approve distressed sales.

BUT I’m not breaking out the champagne yet

Reports about the Mesa AZ Real Estate Market have started to turn positive. Information from Arizona Regional Multiple listing Service (ARMLS®) show that new inventory in January increased by 34% or approximately 9,800 listings. Though this sounds like a significant increase, it is actually 27% below the typical December to January increase of new listings added according to statistics since 2001. The chart below shows all MLS inventory and is a reflection of the Mesa AZ real estate market.

A very interesting statistic reported by ARMLS® is that overall inventory for the last half of 2011 mirrors that of inventories for quarter 2 of 2003 through quarter 1 of 2004. The significance of this is that this is the same conditions existed just before the 2005 Mesa AZ real estate market run up.

Even though we see an overall increase in inventories, days on market are declining and completion for available properties is up. As of January the overall increase in inventory was less than 1.5%. For the Mesa AZ real estate market, the increase of inventory appears to have slightly helped fill the growing buyer demand.

The big question for the Mesa AZ real estate market is how this increasing inventory has affected the overall sales numbers. We know that according to ARMLS® statistics sales fell over 17% from December to January. This decline only is overshadowed by the summer sales drop in July where sales fell by nearly 25%. There are some factors we should consider that goes beyond just the numbers.

Let’s start with the July Mesa AZ real estate sales drop.

1. This drop came on the back of the strongest sales month of the year, June sales MLS wide where over 10,000 units.

2. Another factor affecting areas like the Mesa AZ real estate market was the May foreclosure slow down as banks discontinued their aggressive foreclosure practices, as the Feds initiated legal action against servicers.

3. Now look at January. Even though MLS inventory increased, it was 27% lower than what we would have expected for the period. With inventories closing out the year well below normal market levels, sales were affected as buyers regularly had to make multiple offers to get under contract because of increased completion with other buyers.

These factors significantly explain the sales drop of 1.3% below January 2011 numbers. The chart below shows the comparable sales data year on year between 2011 & 2012.

The inventories are up however in smaller quantities that what we have seen on average over the last 10 years. This is creating more completion since there are a large number of buyers in the Mesa AZ real estate market now. We have seen steady price increased for the last four months. Sales will rise if the available inventory continues to rise at a continued absorbable rate.

This is a great question since the Mesa AZ real estate market has been so dismal for so long. When we look at where prices are today in comparison with where they were just one year ago, we must be encourage. The trends are beginning to show positive news for the real estate market, not only here in the Phoenix area but also in other parts of the country. According to a Report by the National Association of Realtors®

“Existing-Home Sales Rise Again In January, Inventory Down” Washington DC February 22, 2012

According to the article by Walter Molony of NAR, there are positive factors that lead me to believe that real estate as a whole is trending upward. The Mesa AZ real estate market is showing similar or stronger trends. Take for instance a situation with a recent client who wanted to purchase a home under $50,000 in down town Mesa. The property had been on the market 3 days, and after showing the home I contacted the listing agent prior to submitting an offer. The listing agent informed me that they had already received 17 offers and was requiring all buyers “highest & best” offer with these conditions: Earnest money to be a minimum of $5,000 and waiver of inspection period.

Even though Mesa AZ real estate prices are rising slightly, we have not seen a 2004 & 2005 boom type price increase; just lots of competition and a large number of cash buyers. The two charts below show a steady upward trend according to MLS Data. The average sales price of homes MLS wide has risen steadily since October and the number of cash buyers has also risen over the last quarter.

A reasonable conclusion could be made that the growing number of cash buyers acquiring homes in the Mesa AZ real estate market could be the reason for the increase in averages sale price. One major contributing factor is that a cash transaction does not require and appraisal and is a more true reflection of “Market Value” since it is a price negotiated between a buyer and seller and not artificially set up-or-down by a third parties estimation of value based on other “similar” sales.

There are positive signs in the MLS numbers but four months are not enough of a trend to absolutely establish that the Mesa AZ real estate market has come back...