Jenn Jenkins | MPES 2016

ROSE

AVERAGE SALES PRICE BY CITY City

Holly Henbest Realtor®

2014 $199,809

Glendale

$222,725

Mesa

$223,059

Mesa

$240,859

Phoenix

$241,802

Phoenix

$259,811

Peoria

$252,982

Peoria

$269,276

Tempe

$264,302

Tempe

$284,449

Litchfield Park

$278,460

Litchfield Park

$278,044

Gilbert

$282,127

Gilbert

$295,208

Chandler

$287,924

Chandler

$300,616

Cave Creek

$461,686

Cave Creek

$450,963

Fountain Hills

$513,615

Fountain Hills

$514,162

Scottsdale

$630,987

Scottsdale

$630,850

Carefree

$918,432

Carefree

$823,469

Paradise Valley

BestInAZHomes.com

$1,607,465

Paradise Valley

$1,706,195

2015 SALES STATISTICS BY COMMUNITY

Community

17550 N Perimeter Dr | #160 Scottsdale, AZ | 85255

2015

Glendale

480-266-8785 Holly@Henbest.com

Partner With The Best!

The Henbest Team!

City

Average Sale Price

Days on List/Sell # Market Price Ratio Closed

Aviano

$661,227

116

98%

37

Arcadia

$892,995

122

95%

31

Biltmore

$793,565

95

96%

70

Coronado

$259,608

81

96%

13

Fireside

$441,973

78

98%

105

Encanto

$280,875

70

100%

81

Highland Estates

$306,685

43

97%

13

Moon Valley

$318,475

72

98%

153

Tatum Ranch

$349,994

71

98%

198

Statistics gathered from ARMLS. All information deemed reliable but not guaranteed. (Single-Family Residences) If your home is currently listed, this is not a solicitation for that listing.

Produced by Desert Lifestyle Publishing • 480.460.0996 • www.DesertLifestyle.net

economic snapshot | 2016

METRO PHOENIX BY THE NUMBERS

METRO PHOENIX

2016 Outlook Brightest Since 2007

Economic Update

By Elliott Pollack | Elliott D. Pollack & Co.

L

et’s start with the good news. The year 2016 will be the best year that the Greater Phoenix economy has had since 2007 and will feel a bit better because we are on the upswing. In 2007, the economy was slowing. In 2016, it should be improving.

For some slightly less good news, it has become evident that the slower rate of growth we have experienced in this recovery has become our new reality at least for the foreseeable future. This is especially true in Arizona where we have been so affected by the slowdown in population flows. The number of people who have moved from abroad, between states and between counties is down 26% from the early 2000s. In addition, Arizona’s capture rate of those who move is also down. The result has been a rate of population growth that is about half of what has been the historic norm for this point in the cycle.

Part of the reason for the slowdown in population is our employment outlook. The unemployment rate, while low, is higher than what was normal for this point in the cycle. And the number of jobs being created is also lower. We are not getting the normal movement of people who are chasing jobs. When those people show up, they bring with them their own demand for goods and services that creates even more jobs and, thus, more population flows.

Also, slower population flows have lengthened the time it has taken to absorb excess housing and commercial space that was built in the 2005-2007 time period.

That being said, given our post-2007 reality, the state, and especially Greater Phoenix, are doing well.

The state was ranked 12th in terms of employment growth as of November. Greater Phoenix employment should grow by close to 2.9% in 2015 and 3.1% in 2016. Those are the best growth rates of this cycle. Jobs in leisure and hospitality, financial activities, education and health services, and professional and business services lead the way.

A big positive has been the strong comeback in the housing market. Single family permits in Greater Phoenix increased by close to 50% in 2015 and should be up another 20% to 25% in 2016. The apartment market is strong and has the best demographics perhaps ever. The office market is improving and is about two years away from a boom. Industrial is also improving. Retail is still lagging. Thus, construction markets should do well in 2016 and 2017. This is important. The lack of a meaningful recovery in construction employment has been a major factor in slower overall employment growth. And while homebuilders are already complaining of shortages in skilled construction trades, higher wages will take care of that.

2016 should be a good year for the economy overall and construction in particular. Jobs should be up by over 3% in Greater Phoenix. The unemployment rate should continue to decline. Population flows will be up, but not by much. Housing should continue its rapid recovery. And retail sales, especially auto sales, should be up. Given the new reality, it’s a good picture.

Greater Phoenix Economic Forecast POPULATION >

Residential Real Estate

S

everal of the housing markets in the US have now surpassed their pricing at the height of the boom in 2006 or 2007. These include Boston, Dallas, Denver, Portland and San Francisco. The housing market in Greater Phoenix has completed its return to normal, but is still a long way below the peak pricing that was reached in 2006. This is because we had a fully-fledged speculative bubble in Phoenix, like Las Vegas, Miami and Tampa, where prices reached very unrealistic levels before collapsing. Most of the cities that have surpassed their former peaks had relatively modest price rises and falls, so it was easier for them to recover. The exception is San Francisco which has been fueled by the success of the technology industries and a complete lack of new buildable land.

For Phoenix, there is really no reason to expect us to get back to 2006 levels in the medium term. However, at the start of 2016 the Greater Phoenix housing market is in a healthy state and is likely to see appreciation rates well in excess of inflation, except for a few isolated segments. Mind you, inflation is tame these days, well under 1%, so this is not a very difficult target.

• The annual median sales price gained 9% from $192,500 to $209,000

SALES PRICE PER SQUARE FOOT Greater Phoenix • ARMLS Residential

The luxury market had an excellent first half of 2015 but lost momentum in August. The price range between $500,000 and $1,000,000 is still doing reasonably well, with very modest appreciation. Above $1,000,000 demand has dropped since the stock market started looking uncertain in mid 2015. There is also a slight excess of supply, so prices are falling gently in several areas, especially at the top end and in the most remote locations. There is still a strong market for new or newly rebuilt custom homes in this price range, but older homes are suffering from too much competition and too few potential buyers. Investors with the stomach for million dollar rehab projects are few and far between, so homes in need of modernization “...At the start of 2016 the can stay on the Greater Phoenix housing market for a long time unless priced market is in a healthy state...” aggressively.

[

RETAIL SALES >

Source: Elliott D. Pollack & Co., December 2015

SALES PER MONTH Greater Phoenix • ARMLS Residential • Measured Monthly

• The annual average sales price increased 5% from $249,870 to $262,873

3.1% increase in 2016 3.3% increase in 2017

20% increase in 2016 10% increase in 2017

Between $250,000 and $500,000, supply is lower than normal but it is being replenished by new home builders, the majority of whom are focused on this target price range. New single family home permits in Maricopa and Pinal Counties exceeded 16,000 in 2016 having fallen below 12,000 in 2014.

Demand remains normal and healthy and appreciation has typically been in the range 2% to 5% for this price segment.

There are occasional problems for homes that have been neglected or in need of modernization. Most normal buyers seem to have little patience for renovation projects these days. There are plenty of active fix and flip investors, but sellers need to allow for the fact that these investors are not looking to pay market price for your home.

• The annual average price per sq. ft. rose by 5% from $128.13 to $133.97

EMPLOYMENT >

SINGLE FAMILY PERMITS >

strongly as the locations inside the freeway loops.

For the overall market across Greater Phoenix, as of January 2016, the annual numbers based on ARMLS sales were as follows, compared with January 2015:

1.8% increase in 2016 1.9% increase in 2017

5.0% increase in 2016 5.0% increase in 2017

By Michael Orr | Director of Real Estate Studies at ASU & Principal of The Cromford Report

These are consistent with a healthy market, but the situation varies a lot depending on price range and the location and age of the home. Let us look at each of these factors.

The price range below $250,000 is chronically short of supply and the number of buyers is far in excess of the unusually low number of homes for sale. Not surprisingly, appreciation has been strongest for these entry-level homes and condition is rarely a constraint. Location can be an issue – the outer reaches of the valley are not attracting buyers as

In summary, the overall Greater Phoenix housing market is healthier now than it was 12 months ago and the prospect of gradually rising mortgage interest rates is unlikely to have a serious negative effect. The questions still unanswered are whether more of the millennial generation will choose to buy rather than rent in 2016, and whether lenders will relax their underwriting guidelines to people with good but not great credit. One or both of these could possibly lead to an uptick in demand in the low to medium price ranges. This could transform a healthy market into a hectic one.

2016 Outlook Brightest Since 2007

Economic Update

By Elliott Pollack | Elliott D. Pollack & Co.

L

et’s start with the good news. The year 2016 will be the best year that the Greater Phoenix economy has had since 2007 and will feel a bit better because we are on the upswing. In 2007, the economy was slowing. In 2016, it should be improving.

For some slightly less good news, it has become evident that the slower rate of growth we have experienced in this recovery has become our new reality at least for the foreseeable future. This is especially true in Arizona where we have been so affected by the slowdown in population flows. The number of people who have moved from abroad, between states and between counties is down 26% from the early 2000s. In addition, Arizona’s capture rate of those who move is also down. The result has been a rate of population growth that is about half of what has been the historic norm for this point in the cycle.

Part of the reason for the slowdown in population is our employment outlook. The unemployment rate, while low, is higher than what was normal for this point in the cycle. And the number of jobs being created is also lower. We are not getting the normal movement of people who are chasing jobs. When those people show up, they bring with them their own demand for goods and services that creates even more jobs and, thus, more population flows.

Also, slower population flows have lengthened the time it has taken to absorb excess housing and commercial space that was built in the 2005-2007 time period.

That being said, given our post-2007 reality, the state, and especially Greater Phoenix, are doing well.

The state was ranked 12th in terms of employment growth as of November. Greater Phoenix employment should grow by close to 2.9% in 2015 and 3.1% in 2016. Those are the best growth rates of this cycle. Jobs in leisure and hospitality, financial activities, education and health services, and professional and business services lead the way.

A big positive has been the strong comeback in the housing market. Single family permits in Greater Phoenix increased by close to 50% in 2015 and should be up another 20% to 25% in 2016. The apartment market is strong and has the best demographics perhaps ever. The office market is improving and is about two years away from a boom. Industrial is also improving. Retail is still lagging. Thus, construction markets should do well in 2016 and 2017. This is important. The lack of a meaningful recovery in construction employment has been a major factor in slower overall employment growth. And while homebuilders are already complaining of shortages in skilled construction trades, higher wages will take care of that.

2016 should be a good year for the economy overall and construction in particular. Jobs should be up by over 3% in Greater Phoenix. The unemployment rate should continue to decline. Population flows will be up, but not by much. Housing should continue its rapid recovery. And retail sales, especially auto sales, should be up. Given the new reality, it’s a good picture.

Greater Phoenix Economic Forecast POPULATION >

Residential Real Estate

S

everal of the housing markets in the US have now surpassed their pricing at the height of the boom in 2006 or 2007. These include Boston, Dallas, Denver, Portland and San Francisco. The housing market in Greater Phoenix has completed its return to normal, but is still a long way below the peak pricing that was reached in 2006. This is because we had a fully-fledged speculative bubble in Phoenix, like Las Vegas, Miami and Tampa, where prices reached very unrealistic levels before collapsing. Most of the cities that have surpassed their former peaks had relatively modest price rises and falls, so it was easier for them to recover. The exception is San Francisco which has been fueled by the success of the technology industries and a complete lack of new buildable land.

For Phoenix, there is really no reason to expect us to get back to 2006 levels in the medium term. However, at the start of 2016 the Greater Phoenix housing market is in a healthy state and is likely to see appreciation rates well in excess of inflation, except for a few isolated segments. Mind you, inflation is tame these days, well under 1%, so this is not a very difficult target.

• The annual median sales price gained 9% from $192,500 to $209,000

SALES PRICE PER SQUARE FOOT Greater Phoenix • ARMLS Residential

The luxury market had an excellent first half of 2015 but lost momentum in August. The price range between $500,000 and $1,000,000 is still doing reasonably well, with very modest appreciation. Above $1,000,000 demand has dropped since the stock market started looking uncertain in mid 2015. There is also a slight excess of supply, so prices are falling gently in several areas, especially at the top end and in the most remote locations. There is still a strong market for new or newly rebuilt custom homes in this price range, but older homes are suffering from too much competition and too few potential buyers. Investors with the stomach for million dollar rehab projects are few and far between, so homes in need of modernization “...At the start of 2016 the can stay on the Greater Phoenix housing market for a long time unless priced market is in a healthy state...” aggressively.

[

RETAIL SALES >

Source: Elliott D. Pollack & Co., December 2015

SALES PER MONTH Greater Phoenix • ARMLS Residential • Measured Monthly

• The annual average sales price increased 5% from $249,870 to $262,873

3.1% increase in 2016 3.3% increase in 2017

20% increase in 2016 10% increase in 2017

Between $250,000 and $500,000, supply is lower than normal but it is being replenished by new home builders, the majority of whom are focused on this target price range. New single family home permits in Maricopa and Pinal Counties exceeded 16,000 in 2016 having fallen below 12,000 in 2014.

Demand remains normal and healthy and appreciation has typically been in the range 2% to 5% for this price segment.

There are occasional problems for homes that have been neglected or in need of modernization. Most normal buyers seem to have little patience for renovation projects these days. There are plenty of active fix and flip investors, but sellers need to allow for the fact that these investors are not looking to pay market price for your home.

• The annual average price per sq. ft. rose by 5% from $128.13 to $133.97

EMPLOYMENT >

SINGLE FAMILY PERMITS >

strongly as the locations inside the freeway loops.

For the overall market across Greater Phoenix, as of January 2016, the annual numbers based on ARMLS sales were as follows, compared with January 2015:

1.8% increase in 2016 1.9% increase in 2017

5.0% increase in 2016 5.0% increase in 2017

By Michael Orr | Director of Real Estate Studies at ASU & Principal of The Cromford Report

These are consistent with a healthy market, but the situation varies a lot depending on price range and the location and age of the home. Let us look at each of these factors.

The price range below $250,000 is chronically short of supply and the number of buyers is far in excess of the unusually low number of homes for sale. Not surprisingly, appreciation has been strongest for these entry-level homes and condition is rarely a constraint. Location can be an issue – the outer reaches of the valley are not attracting buyers as

In summary, the overall Greater Phoenix housing market is healthier now than it was 12 months ago and the prospect of gradually rising mortgage interest rates is unlikely to have a serious negative effect. The questions still unanswered are whether more of the millennial generation will choose to buy rather than rent in 2016, and whether lenders will relax their underwriting guidelines to people with good but not great credit. One or both of these could possibly lead to an uptick in demand in the low to medium price ranges. This could transform a healthy market into a hectic one.

JENK

My Formula for success is this: 4 understanding market home values 4 understanding market conditions 4 understanding the lending industry 4 understanding expectations If all four of these components are understood, both buyer and seller will have a successful transaction. A great agent is a great educator.

I was born and raised in the Phoenix area.

Since entering real estate I have represented every aspect of the industry – buyers, sellers, and investors in both the residential and commercial market. I believe in the philosophy of the referral network. My time is better spent on you and your transaction, not prospecting and cold calling. Therefore, I ask that you refer me to your friends and family, so that I can take care of them, just as I took care of you.

I look forward to working with you and building a wonderful relationship.

602.214.3881

Jenn@JennJenkins.com dwellings | REALTY GROUP www.dwellingsaz.com

METRO PHOENIX BY THE NUMBERS AVERAGE SALES PRICE BY CITY City

2014

City

2015

Glendale

$199,809

Glendale

$222,725

Mesa

$223,059

Mesa

$240,859

Phoenix

$241,802

Phoenix

$259,811

Peoria

$252,982

Peoria

$269,276

Tempe

$264,302

Tempe

$284,449

Litchfield Park

$278,460

Litchfield Park

$278,044

Gilbert

$282,127

Gilbert

$295,208

Chandler

$287,924

Chandler

$300,616

Cave Creek

$461,686

Cave Creek

$450,963

Fountain Hills

$513,615

Fountain Hills

$514,162

Scottsdale

$630,987

Scottsdale

$630,850

Carefree

$918,432

Carefree

$823,469

Paradise Valley

$1,607,465

Paradise Valley

$1,706,195

2015 SALES STATISTICS BY COMMUNITY

Community Arrowhead Ranch Anthem Country Club Dynamite Mountain Ranch Litchfield Park Sonoran Foothills Sonoran Mountain Ranch Sun Village Terramar Tramonto Vistancia Westwing Mountain

Average Sale Price $298,789 $399,187 $278,892 $302,557 $361,889 $297,986 $188,271 $318,474 $312,890 $311,215 $351,443

Days on List/Sell # Market Price Ratio Closed 81 102 57 72 82 97 68 98 86 86 80

98% 97% 98% 97% 98% 98% 98% 98% 98% 98% 98%

155 222 90 56 100 105 39 116 126 184 88

Statistics gathered from ARMLS. All information deemed reliable but not guaranteed. (Single-Family Residences) If your home is currently listed, this is not a solicitation for that listing.

Produced by Desert Lifestyle Publishing • 480.460.0996 • www.DesertLifestyle.net

economic snapshot | 2016

Let’s be honest – all Realtors® use the same contract and listing site when buying/ selling a home. There is no secret website that magically sells your home or provides a listing that not one other interested buyer can see. But what all Realtors® do not do is service their client and handle the transaction. With each transaction, I handle the process from start to finish; my goal is to create a wonderful experience for my clients and a long lasting relationship.

METRO PHOENIX