Kent Simpson REALTOR® and some other alphabet soup

After generating the April Market Condition Report for the Sam Hughes neighborhood, I noticed some interesting trends in the past year:

• Average listing price is down from the same time last year, but the actual sales price is a MUCH higher percentage than a year ago.
• Time on market is remarkably shorter than a year ago.
• Absorption rate has come back - exceeding the rate of last year, as we head into our "Summer Buying Season"

Take a look:

What does it mean?  Well, comparing the national trend with the Sam Hughes market conditions, you can see a parallel:

1. Homes last year were generally priced higher than buyers were willing to pay...so they stayed on the market longer.  Sellers had to "settle" for a significantly lower price to get their property sold.
2. As the listing average price went down, so did days on market...and the listing/selling price ratio went back up.
3. Selling activity slowed way down during the winter (which is normal in the Tucson real estate market to some extent), which reflects in the month supply of inventory on hand going up.  Another way to look at it could be:  as economic news got bad, confidence was down & buyers held back from making the decision to purchase.
4. When the news started looking a little better and interest rates went down and buyers are starting to get back into the market.

What anomalies did you spot in the statistics above?

• Numbers of properties on the market at any one time stayed pretty much the same in the past year.
• There is a disparity in pricing during the middle period - Sam Hughes has a very wide range of home sizes, and the smaller ones were the ones that sold during the winter, generally.
  

Conclusions?

• Sellers realized that asking prices were unrealistic & had to come down after watching other properties sit and sit on the market.
• Buyers realizing that value & opportunity don't always come at the same time are starting to take advantage of the situation.

If you are someone who is interested in seizing the opportunity in today's real estate market, lets talk about the values we can find together.  Analysis is a strength of mine - put it to work for your benefit.

A week ago, I spent part of a Sunday afternoon in Bisbee, Arizona. While waiting to meet a client before we went to view the Loma Linda Mansion, I had a chance to wander down a side street, away from the tourist area for a few minutes - you never know what's around the corner in an old mining town!

First thing that caught my eye was an old Indian Motorcycle ad painted on the side of a building - someone has spruced it up and done a little restoration to it. Made me think of my days in Durango, Colorado tending bar in a place dedicated & decorated with restored Indians & memorabilia (the bar stools were actually replicas of the saddle on the old Indian Chieftain model). Cool!

As I wandered down to get a better angle to take a photo, I noticed this taxi. One thing I love about the west, old mining towns in particular...is the wry sense of humor that underscores a hardscrabble life. Think I'll let the taxi speak for itself:

...according to quite a few indicators (including my phone & email inbox) by market experts, economists and respected figures in the industry, the real estate market is starting to wake up across the country. 

A couple of days ago, I heard on the radio during the drive to my office that Bank of America & Wells Fargo included figures showing that between 25% & 30% of their loan activity in the 1st quarter was due to first-time homebuyers taking advantage of low prices, low interest rates & the $8000 tax credit (see: Real Estate Trifecta).  In the same quarterly reports, both banks reported strong profits, Wells Fargo posting a record quarter with over $3 billion in the black!

Peter Robinson's column in Forbes today was focused on Todd Zywicki's assertion that The Housing Crisis Isn't A Crisis.  Been a while since the media has had anything even hinting of anything positive about the industry in quite some time.

On Facebook & Twitter, residential and commercial agents are talking of increased activity in both sectors.

At an the Tucson Women's Council of REALTORS® luncheon yesterday, instead of hearing people moan about being slow, there was a spring in people's step.  Shoulders that had previously looked like the weight of the world was upon them were pulled back and postures straight.  Confidence and pride were evident as people traded news of being busy. I'm seeing my activity increase with first-time homebuyers, investors and relocation clients ready to do business.

Does this mean our economy is turning the corner, poised for a rebound?  Frankly, no - not in my limited, non-expert humble opinion.  There's a lot of damage that hasn't even been identified yet, and there's no "quick fix" that will solve the world's economic woes.  The Tucson real estate market is moving along.

What my interpretation is - that people and institutions are peeling away the paralysis of shock, getting up from the staggering punches of the fall & winter.  It is almost like we are collectively pulling together and saying, "Ok so the economy sucks...got it...you told me a thousand times.....so lets deal with it and go on with life."  We have come to the realization that somewhere down the road, things will get better.  We don't know when, but it will.  We've always come through tough times & will again.  That's what the human spirit knows.

I'm expecting a very busy late spring & summer for real estate.  My opinions could very well turn out to be hogwash, but I don't care what anyone else thinks - activity speaks of confidence, not fear & timidity.  The economy may not be turning around yet, but the public is ready to do what they need to do to get started.  So the parties are potluck dinners instead of catered affairs.  Big deal.  We all gotta eat anyway, and some of my neighbors are better cooks than most restaurants.

It all starts with the mindset.  The recovery begins at home.

Chances are.........we'll get through this mess, just like we always have before.  Trust me on this one - history proves it.

Chances are...

Homebuyers - there is something special going on right now in the market: The Real Estate Trifecta!

Horse race fans dream of "hitting the trifecta" where a small wager reaps big rewards. Now I don't equate buying real estate with betting on the ponies, but in all reality, any investment is a wager of sorts.

What is going on right now in the Tucson market is the "Real Estate Trifecta." There have been buyer's markets before, there have been low interest rates before - usually not at the same time. Add in incentives like loan programs that have rehab costs rolled in....or for first-time homebuyers, the big ticket: the $8000 tax CREDIT - and buyers have something that comes around once in a lifetime: the Trifecta.

I know, I know...people in real estate are always saying: "Its a great time to buy." Yada, yada, yada.

The reality is this: With market conditions what they are, with prices this low, with interest rates near historic lows, with all of the incentives available right now - you add it up. When you have time to mull it over, there hasn't been a better time in decades to buy real estate than right now. You won't see this kind of opportunity coming around very often, if ever, again.

My practice is centered on buyer representation - give me a call & lets discuss your wants & needs in the Greater Tucson Area. Lets get you the home you & your family deserve.

Sam Hughes Neighborhood is located just east of the University of Arizona campus in Tucson, Arizona.
It is a vibrant, eclectic neighborhood favored by academics, professionals and students.  Properties are a blend of single family homes, condos, apartments and townhomes - with construction ranging from the 1920's to today.

Below are sales statistics for the past year (as of 4/1/2009):

Should you be interested in living in such a community or would like to see what some of the homes look like, please click here to see a slide show on the area.

If you are an investor and would like to see the performance of an investment in Sam Hughes Real Estate, please click here.

My name is Kent Simpson - I specialize in buyer representation in the Tucson Metro area.