John Karadsheh
A strong economy is what drives a strong real estate market.
Recent statistics offer confirmation of what we are seeing on the ground—first-time homebuyers and boomerang buyers are coming back to market. However, this month’s real estate tidbits also demonstrate the fact lifestyle plays a large role in the real estate market, as well.
- Did you know Arizona’s population increased by nearly 100,000 in 2015, compared to 77,925 in 2014? This uptick was largely the result of localized growth, as Maricopa County finished first in the nation for people moving in from other parts of the country.
- In a new report by BBVA economists, Arizona has a zero percent chance of recession in the near term, and 2.5 percent growth is expected going forward. This is very positive, especially when you look at Wyoming, which has an expected 100 percent chance of recession.
- These statistics complement the fact Arizona finally has recovered all of the jobs lost during the recession, and the seasonally adjusted unemployment rate is now at 5.4 percent.
- After years of waiting, new production homebuilding suddenly has exploded. Unfortunately, labor shortages have slowed the speed at which these homes can be completed. Not only will this growth support jobs, but, from past experience, we also know it will boost the local economy as a whole. On the flip side, we anticipate the cost of new builds will continue to rise.
- Bidding wars are becoming the new normal for listings under $250,000. With an increasing number of first-time homebuyers entering the market, and investors still dabbling, multiple offers have become a common scene in the lower price ranges.
- The luxury market remains soft. In 2015, just 21 Mesa homes closed over $1 million (Gilbert closed 19 and Chandler closed 21). Through April 15 of this year, there have been three $1 million plus homes that have closed in Mesa (again, on par with Gilbert and Chandler, which also have each had three $1 million plus homes close so far in 2016). Consequently, this is great news for buyers. Most luxury customs on the market are listed below replacement cost and are a great value for the lot sizes, square footage, amenities and quality of construction.
- According to a recent article in Bloomberg News, homes with barn doors, farmhouse sinks, subway tile and pendant lighting sell faster than homes without these features. Buyers definitely are looking for properties remodeled to current styles. So, if you are considering a remodel, look to HGTV’s Fixer Upper for inspiration.
- According to a Zillow study, homes near a Trader Joe’s or Whole Foods appreciate faster than other properties. According to Zillow Group Chief Economist Stan Humphries, “Like Starbucks, the stores have become an amenity in their own right—a signal to the home-buying public that the neighborhood they’re located in is desirable, perhaps up-and-coming and definitely improving.” While this news is perhaps not entirely good, given the fact we have neither a Whole Foods nor a Trader Joe’s in Northeast Mesa, it does give us motivation to keep lobbying for more amenities.
So, after the first quarter of 2016, here is what we know. We are looking forward with confidence that our local economy will continue to grow upward for the next few years. We also think the best buys in the area remain in the price ranges over $500,000. Lastly, we just bought a set of barn doors for our new offices. So, if you aren’t sure about this trend, come by and check them out.
John Karadsheh is the Designated Broker for KOR Properties. He has been a Multi-Million Dollar producing agent for more than 13 years, and is an Accredited Buyers Representative (ABR) and Certified Residential Specialist (CRS). In 2014, John was voted the No. 1 Real Estate Agent in Arizona by Ranking Arizona. You can reach John at (480) 568-8684, or visit his website at KORproperties.com.