Metro Phoenix Economic Snapshot 2011 Mid Year Update

Paula Young With over 30 years in the real estate industry, I have had the opportunity to sharpen my skills and knowledge, and offer a combination of expertise and experience that is so critical to achieve the results we all want. For your success is my success.

Many of my years in the industry have been spent in the Seattle area. I started as a realtor and broker then decided I wanted to learn more about the financing of real estate and worked in the mortgage lending industry for several years and achieved a position of branch manager of one of U.S. Banks largest mortgage divisions.

I moved to the beautiful Phoenix area nearly a decade ago planning to retire from a wonderful career but that was short lived. I love real estate and being of service gives me great satisfaction.

As Arizona is a highly desirable destination, I have had the opportunity to work with many fellow Washingtonians to find the community and home that fit their lifestyle. It would be an honor to help you find the home of your dreams, or a second home or perhaps just a great investment. If you are a real estate agent and have clients considering the Phoenix area, refer them to me. You can be assured they will get the level of service you can be proud of.

I believe that one of the best tools I can offer my clients is information. Metro Phoenix Economic Snapshot 2011 has been developed to familiarize you with the Phoenix marketplace and the many opportunities that now exist in real estate. The Phoenix/Scottsdale area will continue to be in demand for decades to come. Let me help you make one of the smartest and successful purchases, perhaps, in your lifetime!

Give me a call today!

M E T R O

2011 YTD Average Sales Price By City CITY SINGLE-FAMILY CONDOS &

RESIDENCES ONLY PATIO HOMES ONLY Glendale......................................... $114,591...............................$44,555 Phoenix............................................ $128,199...............................$80,651 Mesa................................................ $144,521...............................$61,697 Peoria.............................................. $166,393.............................$118,532 Tempe.............................................. $177,165.............................$114,051 Gilbert.............................................. $187,762...............................$70,416 Litchfield Park.................................. $192,548...............................$74,103 Chandler......................................... $199,796...............................$75,576 Cave Creek.................................... $331,569.............................$198,580 Fountain Hills................................... $423,910.............................$170,870 Scottsdale....................................... $497,938.............................$191,980 Carefree.......................................... $656,309.............................$229,125 Paradise Valley............................ $1,396,849...............................$97,106

Testimonials “Paula is a quality, caring person and will give you excellent service when buying or selling real estate. She will find what you want whether it be a home or investment property. Her motto is to give the highest level of customer satisfaction, and she certainly delivers.”

— Marlene and Alan Lomax, Bellevue “Paula Young is the agent you want to be working for you in selling or buying your home.

Being an agent in the Seattle area myself, I have referred many buyers to her. She does a great job of listening to her buyer’s needs and takes the time to help them get what they really want. Personally I hired her to list my second home in the Phoenix area and had it sold in an amazing amount of time.” — Dawn Sullivan, John L. Scott Real Estate

“I am happy to recommend Paula Young to anyone who is seeking to purchase real estate. Paula helped me find the perfect home. She proved to be highly professional and very organized. Paula continued to be extremely helpful throughout the negotiations and the entire closing process. In addition to being extremely knowledgeable, she demonstrated great attention to all the details to ensure that the sale and closing proceeded smoothly. She is bright, energetic and made the real estate search very enjoyable.

I heartily recommend her without reservation.” — Keith VanVelkinburgh, Christy Sports LLC

ReMax Sun Properties Direct: 602.478.6546 Fax: 480.816.1022 youngpaula@aol.com www.paulayoungproperties.com All agent referrals will be honored.

If your home is currently listed, this is not a solicitation for that listing.

M I D -Y E A R U P D AT E

Statistics gathered from ARMLS. All information is deemed reliable but not guaranteed.

“I have dealt with Paula on several transactions in the Phoenix area. She has always been very professional and provided superior service and knowledge. I would highly recommend her to anyone looking to purchase in the Phoenix area.”

— Michael and Cyndee Bassie, Kirkland

Paula Young

P H O E N I X

“When I first came to Arizona, I took it upon myself to search the valley to find a home.

After a week of diligent searching I found myself making an offer on a townhouse in Fountain Hills that Paula told me about during our initial conversation. Not only is she an expert in knowing her demographical area but, the needs and desires that will best fit your home expectations as well.” — Gregg Anderson, Absolute Mortgage “Thanks to Paula’s bulldog attitude we now have our dream retirement home. She listened to our likes and observed our lifestyle. Putting the two together, she walked us into our wonderful home. She has a real talent for finding the right home or investment for her clientele.” — Mike and Bea Cannon “Paula Young has the integrity and commitment to get the job done. Coming from out of state to purchase my retirement home was stressful. Paula was available the entire time, and definitely went beyond her duty seeing the task through. Paula had my best interest at heart and new excellent resources to accomplish any concerns. I value Paula as a committed realtor and have recommend her to my family and friends.”

— Linda Gray, Seattle

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

The Real Estate Market What’s Happening in 2011?

Unemployment Consumer Spending GDP Growth A Review of the Economy and What to Expect

Mortgage Interest Rates

A Look Back at the Good, the Bad and the Ugly

E’VE BEEN DOUBLE-DIPPED

2010-2011 Sales Statistics

etro Phoenix home prices bottomed out in April of 2009 with a median sales price of $115,000 – this after a peak of $265,000 timeI of 2009, home prices R E during S I DtheEboom NT AJune L 2006.

R EAfter A April L E S TAT Ebegan scooting back up and the median hovered at $130,000 un t summer when the federal homebuyer tax credit expired. By December of 2010, the median home price fell to a new low of $110,000, creating a dreaded “double-dip” in a fragile market that

NUMBER OF housing MEDIAN s been precariously attempting to rebound. (The median figures reported are for all types of housing sold,We’ve including condominiums, patio homes and townhomes. median values for SALES single-family Been Double-Dipped The SOLD LISTINGS PRICE Metro Phoenix home prices bottomed outhome in April ofprice 2009 with median sales operties are higher when calculated separately.) The Arizona Regional Multiple Listing Service’s data forecasts the Valley’s median toa climb back up to June $115,000 in January.

While 2010’s 2010 9,158 $127,630 hom price of $115,000 – this after a peak of $265,000 during the boom time of June es pattern can be described as “one step forward and two steps back,” the prediction for 2011 is improving “two forward and oneback step back.”

July 2010 6,913 $125,000 2006.to After April steps 2009, home prices began scooting up and the median August 2010 7,000 $119,287 hovered at $130,000 until last summer when the federal homebuyer tax credit expired.

By May of 2011, the median home price fell to a new low of $108,000, September 2010 6,715 $119,900 ind hile price declines are painful, the good news is that demand has remained strong through 2010 (see chart: 2010 Sales Statistics). The cure for low prices is low prices.

Indeed, the home affordability creating a dreaded “double-dip” in a fragile housing market that has been October 2010 6,556 $120,000 ll help to bring in more and more buyers and move out the excess inventory. precariously attempting to rebound. (The median figures reported are for all types November 2010 6,740 $115,000 of housing sold, including condominiums, patio homes and townhomes. The for single-family properties are when calculated Decemberas2010 8,405 $110,000 hat does this mean for the future of our housing market? Pricing is expected to slide a bit further this year.median Anyvalues further price decline ishigher expected to beseparately.) mod- The Interest Rate Dance est though, the heart-stopping drops of rece While 2010’s home-sales pattern can be described as “one step forward and two January 2011 6,530 $110,000

Mortgage interest rates plunged to record lows in the last year (see table: 30-Year ars past are behind us now. Despite the drop in pricing, the strong volume of sales in 2010 shows us whatsteps ourback, market should do in the future.

Pricing is a lagging indicator, but the supply and demand levels generally indicate what prices will do.

So with con ” the prediction for 2011 is improving to “two steps forward and one Fixed Rate Mortgages Annual Average), with a 30-year fixed-rate low of 4.16%.

February 2011 7,163 $109,000 G E N E R A L E C O N O M I C S N A P S H OT step back.” ued demand in 2011, any mild price decreases we experience should then begin to rise from there.

But with the economy showing signs of life, rates had begun rising in early 2011 March 2011 9,973 $110,000 While price declines are painful, the good news is that demand has remained to nearly 5%. By mid-year, rates trickled back down to 4.55%. By the time the strong through 2010 and 2011 (see chart: 2010-2011 Sales Statistics). The cure for April 2011 9,477 $110,000 housing market recoverywhich is under way this year and into 2012, can expect We must remember that price declines do not forecast a bad market ahead, they are an indicator of a bad market in the recent past.

But theseindex price declines stimulate demand is later a necessary part ofwethe recovery process,” reports The Cromford Report, low prices is low prices.

Indeed, the home affordability will help to bring in May 2011 9,881 $108,000 to see rates climbing again. Lawrence Yun, National Association of Realtors chief I’ve got to admit it’s getting better. A little better all the time. more and more buyers and move out the excess inventory. ocal real estate research firm. economist forecasts rates to average over 5% in 2011 and 5.8% in 2012 – a nearly Source: ARMLS

I have to admit it’s getting better. It’s getting better since you’ve been mine.

Getting STRESSED PROPERTIES EASING UP so much better all the time.

What does this mean for the future of our housing market? Pricing is 2% increase from last year’s low. expected to slide a bit further this year. Any further price decline is expected to For potential homebuyers wrestling with the decision on the best time to buy, be modest though, as the heart-stopping drops of recent years past are behind us it appears to be NOW. For even if home prices experience another 5% to 10% now. Despite the drop in pricing, the strong volume of sales in 2010 and the first — John Lennon & Paul McCartney, Sgt. Pepper’s Lonely Hearts Club Band decline, the cost-of-money to borrow at higher rates the longer you wait may just part ofmarket 2011 showsis us expected what our market do inthough the future. perhaps Pricing is a lagging monthly you might For every point that interestwork rates gothrough up hile still at elevated levels and putting pressure on home values, the amount of foreclosures within our local toshould drop, not inoffset theanyfirst fewsavings months ofsee.

2011 while banks the backlog created last year with their tw indicator, but the supply and demand levels generally indicate what prices will do. on an 80% loan, the effective price of the home goes up about 10% due to what the onth moratorium on foreclosures.

YEAR RATE YEAR RATE So with continued demand in 2011, any mild price decreases we experience should difference in payments would amortize.

As we’re moving our way through 2011, most of us have The stock market made some encouraging gains in 2010 then begin to rise from there.

1972 7.38 % 1992 8.39 % our sights set on the economy. Just what can we expect for the and the first half of 2011. The DJIA closed out last year with For sellers, waiting to put your home on the market until prices rise may

“We must remember that price declines do not forecast a bad market ahead, 1973 8.04 % 1993 7.31 % rest of the year?

Continued recession?

A robust recovery?

Or, a respectable 11% growth and has been steadily rising this also offset gain you’d Your pool sign. of potential be different. reclosure activity peaked in 2010 (see Chart: Monthly Foreclosure Activity in Maricopa County). But the drop in pre-foreclosures from 97,141 in 2009 to 79,637 inany 2010 is ahave. positive In buyers fact,will the total of 5,475 notices in December 2010 is the lowest lev they are an indicator of a bad market in the recent past. But these price declines 1974 9.19 % 1994 8.38 % perhaps something in the middle. Indications seem to point year. With a peak of 12,807 in May 2011, the market has made Many won’t qualify at the higher rates when they would have qualified today.

ce March of 2008.

While we still have several more years of distressed property inventory to eat up (it’s estimated that 22.5%-38.9% of homeowners are underwater on their mortgage), the homes purchased today are subject to much more rigorous lending 1975 9.05 % 1995 7.93 % stimulate demand which is a necessary part of the recovery process,” reports to a better economic environment for 2011 than 2010. Indeed, tremendous improvements since the low point we saw in March Additionally, if you’ll be repurchasing then you’ll too be financing at the higher 1976 8.87 % 1996 7.81they’re % The Cromford Report, a local real estate research firm. ndards. the Aseconomy Tom Ruff, an analyst with Information Market says, “The new loans coming into the pool have made it through strict underwriting protocol while the bad loans just keep getting sent to the courthouse steps, and once they’re foreclosed, n is improving; albeit more slowly than most of us 2009 of 6,626. Kiplinger.com forecasts the Dow to continue to rates we will have.

Americans anxious progress prefer. Overall, 2010 nger delinquent.

Goodforin, badwould out.”

30-Year Fixed-Rate Mortgages Annual Average

1977 8.85 % 1997 7.60 % rise in 2011 with the rally likely to persist into 2012.

1978 9.64 % 1998 6.94 % was better than 2009. 2011 is expected to be better than 2010.

Certainly our humble recovery hasn’t indicated that all of 1979 11.20 % 1999 7.44 % While still at elevated levels and putting pressure on home values, the amount of Whether it’s a clearance sale on a high-quality pair of shoes, or an investor And 2012 even better yet, than this year. The good news is that our troubles are behind us. The two major snags to a robust 1980 13.74 % 2000 8.05 % foreclosures within our local market is expected to drop, particularly during the “buying low to sell high,” savvy shoppers know to capitalize on an opportunity to further economic declines are not expected this year. The bad recovery continue to be the nation’s weak housing market and 1981 16.63 % 2001 6.97 % latter half of 2011. buy a valued item at a huge discount. And while Arizona real estate is priced very HE INTEREST DANCE news is thatRATE our recovery appears to be weak and protracted. disappointing unemployment. Employers added over 1 million 1982 16.04 % 2002 6.54 % Foreclosure activity peaked in 2010 (see chart: Monthly Foreclosure Activity in low right now, the most important factor indicative of a good investment is the Making headlines in the mid-to-latter part of 2010, the workers to payrolls in 2010 according to figures from the Labor 1983 13.24 % 2003 5.83 % Maricopa County). But the drop in pre-foreclosures from 97,141 in 2009 to 79,637 potential value and worth. If you subscribe to the belief that Arizona is a highly announcement that “THE RECESSION IS OVER” had been Department. But the gains haven’t been enough to significantly 1984 13.88 % 2004 in 2010 is a positive sign.

While we still have several more years of distressed ortgage interest rates plunged to record lows in 2010 (see table: 30-Year Fixed Rate Mortgages Annual Average), with a 30-year fixed-rate low of 4.16%. But desirable with the economy showing signs ofdecades life,torates have begun rising in early 2011 to nearly 5.84 5%.% By the destination and will be in much demand in the come, than met with scoffs and sneers. “If that’s the case, it sure hasn’t reduce unemployment. While forecasters expect employers to 1985 12.43 % 2005 5.87 % property inventory to eat up (it’s estimated that 22.5%-38.9% of homeowners are buying propertyof in today’s market may be the wisest move youforecasts can make for your me the housing market recovery is under waydisagree later this and into 2012, weyear, can see rates continue their upward trend. Lawrence Yun, National Association Realtors chief economist rates to average 5% and 5.8% in 2012 been feeling like it,” many groaned. While economists addyear another 2.5 million workers this it’llexpect be several to years 1986 over 10.19 % in 20112006 6.41 % underwater on their mortgage), the homes purchased today are subject to much future wealth portfolio.

1987 10.21 % 2007 6.34 % on what exactly defines recession, we all low. know it’s when the before all of the 8.4 million jobs that have been lost will be nearly 2% increase froma last year’s more rigorous lending standards. As Tom Ruff, an analyst with Information Market 1988 10.34 % 2008 6.03 % economy fails to grow, or contracts. recaptured. says, “The new loans coming into the pool have made it through strict underwriting 1989 10.32 % 2009 5.04 % 2011 has given us a 1% - 2% rate of growth, depending on the protocol while the bad loans just keep getting sent to the courthouse steps, and r potential homebuyers wrestling with the decision on the best time to buy, it appears to be NOW. For even if home prices experience another 5% to 10% decline, the cost-of-money to borrow at higher rates the longer you wait may just offset any monthly 1990 10.13 % 2010 4.69 % quarter. Generally recoveries from recessions have been closer once they’re foreclosed, they’re no longer delinquent. Good in, bad out.”

1991 9.25 % Source: Freddie Mac vings you might see.

For every point that interest go upand onthean 80% loan, thespecifically, effective Arizona, Metro Phoenix market haveprice of the home goes up about 10% due to what the difference in payments would amortize. to the 4% or 5% range in GDP growth, but this modest growth rates been hit worse than most other markets in the US. Our housing is growth nonetheless. A clear signal that the recession truly market has fallen harder, population growth has spiraled to is over. r sellers, waiting to put your home on the market until prices rise may also offset any gain you’d have. Your pool of potential buyers will be different. Many won’t qualify at the higher rates when they would have qualified today. Additionally, If you’ll Source: Information Market be Source: Freddie Mac historic lows, and in 2009 Arizona (generally always in the top purchasing then you’ll too be financing at the higher rates westates) willsank have. five growth to 49th out of 50 states when measuring As the economy accelerated into 2011, national claims for employment growth.

Source: Information Market MONTH RESIDENTIAL NOTICE RESIDENTIAL MONTH RESIDENTIAL NOTICE RESIDENTIAL dropped at the end of 2010 to the lowest level in However bleak our decline, Arizona is regaining ground.

RIZONAjobless ONbenefits SALE

OF TRUSTEES SALE FORECLOSED

OF TRUSTEES SALE FORECLOSED two years. The Institute for Supply Management-Chicago Inc. By the end of 2010, Arizona had added jobs for four months in December 5,475 3,283 December 7,405 4,792 reported its business barometer ended 2010 at 68.6 (a figure a row, dropping unemployment from 9.5% to 9.4%, while the hether it’s a clearance on signifies a high-quality an rose investor “buying lowsame totime sell high,” savvy shoppers know to capitalize on an opportunity to buy aNovember valued item at 5,607 a huge discount. And real estate is6,679 priced very low3,485 right now, the 2,509 while Arizona November greater than 50 on thesale barometer an expansion),pair whichof shoes, nation as or a whole from 9.6% to 9.8% in that is the highest level in over two decades. period.

The state is expected to add 48,000 jobs in 2011 and October 6,728 4,034 October 7,303 4,444 ost important factor indicative of a good investment is the potential value and worth. If you subscribe to the belief that Arizona is a highly desirable destination and will be in much demand in the decades to come, than buying property in today’s market may After more than three years of “forced frugality” among recent data shows that Arizona has become the number-one September 7,116 4,877 September 7,408 3,432 the wisest move you can make for your future wealth portfolio.

American consumers, it seems that shoppers are weary of fastest-growing market for private sector jobs. Metropolitan August 7,186 4,831 August 8,624 3,546 non-spending. Holiday 2010 purchasing rose a fantastic 5.5% Phoenix is now ranked second in highest job growth among July 7,804 4,651 July 8,671 4,711 according to the MasterCard Advisors SpendingPulse report. large cities, only lagging behind Washington, D.C. June 5,833 4,584 June 8,138 4,688 Exceeding even the most optimistic retail spending forecasts, “2011 is going to be the best year for Arizona’s economic May 6,106 3,841 May 8,126 3,472 the rate of spending during the 2010 holiday season was the growth in the past three years,” stated ASU economist Lee April 6,634 4,115 April 8,552 3,787 highest since 2005 – that banner year for the economy.

McPheters at the 47th annual forecast luncheon sponsored by March 7,625 5,127 March 10,077 3,023 With consumer spending elevated, manufacturing will see ASU and JP Morgan Chase Bank. “I think it’s pretty clear we’re February 7,179 3,891 February 8,000 4,780 an uptick as retailers will need to restock shelves. Business on the threshold of recovery. Arizona is much stronger than it spending is expected to further increase in 2011 and into was a year ago,” he continued.

January 6,344 4,065 January 8,158 3,832 2012 as well.

Total: 79,637 49,808 Total: 97,141 47,992

Distressed Properties Easing Up

Arizona On Sale

Arizona Outpacing The Nation?

2010

2009

Monthly Foreclosure Activity In Maricopa County

An Economy On The Mend

E’VE BEEN DOUBLE-DIPPED

2010-2011 Sales Statistics

etro Phoenix home prices bottomed out in April of 2009 with a median sales price of $115,000 – this after a peak of $265,000 timeI of 2009, home prices R E during S I DtheEboom NT AJune L 2006.

R EAfter A April L E S TAT Ebegan scooting back up and the median hovered at $130,000 un t summer when the federal homebuyer tax credit expired. By December of 2010, the median home price fell to a new low of $110,000, creating a dreaded “double-dip” in a fragile market that

NUMBER OF housing MEDIAN s been precariously attempting to rebound. (The median figures reported are for all types of housing sold,We’ve including condominiums, patio homes and townhomes. median values for SALES single-family Been Double-Dipped The SOLD LISTINGS PRICE Metro Phoenix home prices bottomed outhome in April ofprice 2009 with median sales operties are higher when calculated separately.) The Arizona Regional Multiple Listing Service’s data forecasts the Valley’s median toa climb back up to June $115,000 in January.

While 2010’s 2010 9,158 $127,630 hom price of $115,000 – this after a peak of $265,000 during the boom time of June es pattern can be described as “one step forward and two steps back,” the prediction for 2011 is improving “two forward and oneback step back.”

July 2010 6,913 $125,000 2006.to After April steps 2009, home prices began scooting up and the median August 2010 7,000 $119,287 hovered at $130,000 until last summer when the federal homebuyer tax credit expired.

By May of 2011, the median home price fell to a new low of $108,000, September 2010 6,715 $119,900 ind hile price declines are painful, the good news is that demand has remained strong through 2010 (see chart: 2010 Sales Statistics). The cure for low prices is low prices.

Indeed, the home affordability creating a dreaded “double-dip” in a fragile housing market that has been October 2010 6,556 $120,000 ll help to bring in more and more buyers and move out the excess inventory. precariously attempting to rebound. (The median figures reported are for all types November 2010 6,740 $115,000 of housing sold, including condominiums, patio homes and townhomes. The for single-family properties are when calculated Decemberas2010 8,405 $110,000 hat does this mean for the future of our housing market? Pricing is expected to slide a bit further this year.median Anyvalues further price decline ishigher expected to beseparately.) mod- The Interest Rate Dance est though, the heart-stopping drops of rece While 2010’s home-sales pattern can be described as “one step forward and two January 2011 6,530 $110,000

Mortgage interest rates plunged to record lows in the last year (see table: 30-Year ars past are behind us now. Despite the drop in pricing, the strong volume of sales in 2010 shows us whatsteps ourback, market should do in the future.

Pricing is a lagging indicator, but the supply and demand levels generally indicate what prices will do.

So with con ” the prediction for 2011 is improving to “two steps forward and one Fixed Rate Mortgages Annual Average), with a 30-year fixed-rate low of 4.16%.

February 2011 7,163 $109,000 G E N E R A L E C O N O M I C S N A P S H OT step back.” ued demand in 2011, any mild price decreases we experience should then begin to rise from there.

But with the economy showing signs of life, rates had begun rising in early 2011 March 2011 9,973 $110,000 While price declines are painful, the good news is that demand has remained to nearly 5%. By mid-year, rates trickled back down to 4.55%. By the time the strong through 2010 and 2011 (see chart: 2010-2011 Sales Statistics). The cure for April 2011 9,477 $110,000 housing market recoverywhich is under way this year and into 2012, can expect We must remember that price declines do not forecast a bad market ahead, they are an indicator of a bad market in the recent past.

But theseindex price declines stimulate demand is later a necessary part ofwethe recovery process,” reports The Cromford Report, low prices is low prices.

Indeed, the home affordability will help to bring in May 2011 9,881 $108,000 to see rates climbing again. Lawrence Yun, National Association of Realtors chief I’ve got to admit it’s getting better. A little better all the time. more and more buyers and move out the excess inventory. ocal real estate research firm. economist forecasts rates to average over 5% in 2011 and 5.8% in 2012 – a nearly Source: ARMLS

I have to admit it’s getting better. It’s getting better since you’ve been mine.

Getting STRESSED PROPERTIES EASING UP so much better all the time.

What does this mean for the future of our housing market? Pricing is 2% increase from last year’s low. expected to slide a bit further this year. Any further price decline is expected to For potential homebuyers wrestling with the decision on the best time to buy, be modest though, as the heart-stopping drops of recent years past are behind us it appears to be NOW. For even if home prices experience another 5% to 10% now. Despite the drop in pricing, the strong volume of sales in 2010 and the first — John Lennon & Paul McCartney, Sgt. Pepper’s Lonely Hearts Club Band decline, the cost-of-money to borrow at higher rates the longer you wait may just part ofmarket 2011 showsis us expected what our market do inthough the future. perhaps Pricing is a lagging monthly you might For every point that interestwork rates gothrough up hile still at elevated levels and putting pressure on home values, the amount of foreclosures within our local toshould drop, not inoffset theanyfirst fewsavings months ofsee.

2011 while banks the backlog created last year with their tw indicator, but the supply and demand levels generally indicate what prices will do. on an 80% loan, the effective price of the home goes up about 10% due to what the onth moratorium on foreclosures.

YEAR RATE YEAR RATE So with continued demand in 2011, any mild price decreases we experience should difference in payments would amortize.

As we’re moving our way through 2011, most of us have The stock market made some encouraging gains in 2010 then begin to rise from there.

1972 7.38 % 1992 8.39 % our sights set on the economy. Just what can we expect for the and the first half of 2011. The DJIA closed out last year with For sellers, waiting to put your home on the market until prices rise may

“We must remember that price declines do not forecast a bad market ahead, 1973 8.04 % 1993 7.31 % rest of the year?

Continued recession?

A robust recovery?

Or, a respectable 11% growth and has been steadily rising this also offset gain you’d Your pool sign. of potential be different. reclosure activity peaked in 2010 (see Chart: Monthly Foreclosure Activity in Maricopa County). But the drop in pre-foreclosures from 97,141 in 2009 to 79,637 inany 2010 is ahave. positive In buyers fact,will the total of 5,475 notices in December 2010 is the lowest lev they are an indicator of a bad market in the recent past. But these price declines 1974 9.19 % 1994 8.38 % perhaps something in the middle. Indications seem to point year. With a peak of 12,807 in May 2011, the market has made Many won’t qualify at the higher rates when they would have qualified today.

ce March of 2008.

While we still have several more years of distressed property inventory to eat up (it’s estimated that 22.5%-38.9% of homeowners are underwater on their mortgage), the homes purchased today are subject to much more rigorous lending 1975 9.05 % 1995 7.93 % stimulate demand which is a necessary part of the recovery process,” reports to a better economic environment for 2011 than 2010. Indeed, tremendous improvements since the low point we saw in March Additionally, if you’ll be repurchasing then you’ll too be financing at the higher 1976 8.87 % 1996 7.81they’re % The Cromford Report, a local real estate research firm. ndards. the Aseconomy Tom Ruff, an analyst with Information Market says, “The new loans coming into the pool have made it through strict underwriting protocol while the bad loans just keep getting sent to the courthouse steps, and once they’re foreclosed, n is improving; albeit more slowly than most of us 2009 of 6,626. Kiplinger.com forecasts the Dow to continue to rates we will have.

Americans anxious progress prefer. Overall, 2010 nger delinquent.

Goodforin, badwould out.”

30-Year Fixed-Rate Mortgages Annual Average

1977 8.85 % 1997 7.60 % rise in 2011 with the rally likely to persist into 2012.

1978 9.64 % 1998 6.94 % was better than 2009. 2011 is expected to be better than 2010.

Certainly our humble recovery hasn’t indicated that all of 1979 11.20 % 1999 7.44 % While still at elevated levels and putting pressure on home values, the amount of Whether it’s a clearance sale on a high-quality pair of shoes, or an investor And 2012 even better yet, than this year. The good news is that our troubles are behind us. The two major snags to a robust 1980 13.74 % 2000 8.05 % foreclosures within our local market is expected to drop, particularly during the “buying low to sell high,” savvy shoppers know to capitalize on an opportunity to further economic declines are not expected this year. The bad recovery continue to be the nation’s weak housing market and 1981 16.63 % 2001 6.97 % latter half of 2011. buy a valued item at a huge discount. And while Arizona real estate is priced very HE INTEREST DANCE news is thatRATE our recovery appears to be weak and protracted. disappointing unemployment. Employers added over 1 million 1982 16.04 % 2002 6.54 % Foreclosure activity peaked in 2010 (see chart: Monthly Foreclosure Activity in low right now, the most important factor indicative of a good investment is the Making headlines in the mid-to-latter part of 2010, the workers to payrolls in 2010 according to figures from the Labor 1983 13.24 % 2003 5.83 % Maricopa County). But the drop in pre-foreclosures from 97,141 in 2009 to 79,637 potential value and worth. If you subscribe to the belief that Arizona is a highly announcement that “THE RECESSION IS OVER” had been Department. But the gains haven’t been enough to significantly 1984 13.88 % 2004 in 2010 is a positive sign.

While we still have several more years of distressed ortgage interest rates plunged to record lows in 2010 (see table: 30-Year Fixed Rate Mortgages Annual Average), with a 30-year fixed-rate low of 4.16%. But desirable with the economy showing signs ofdecades life,torates have begun rising in early 2011 to nearly 5.84 5%.% By the destination and will be in much demand in the come, than met with scoffs and sneers. “If that’s the case, it sure hasn’t reduce unemployment. While forecasters expect employers to 1985 12.43 % 2005 5.87 % property inventory to eat up (it’s estimated that 22.5%-38.9% of homeowners are buying propertyof in today’s market may be the wisest move youforecasts can make for your me the housing market recovery is under waydisagree later this and into 2012, weyear, can see rates continue their upward trend. Lawrence Yun, National Association Realtors chief economist rates to average 5% and 5.8% in 2012 been feeling like it,” many groaned. While economists addyear another 2.5 million workers this it’llexpect be several to years 1986 over 10.19 % in 20112006 6.41 % underwater on their mortgage), the homes purchased today are subject to much future wealth portfolio.

1987 10.21 % 2007 6.34 % on what exactly defines recession, we all low. know it’s when the before all of the 8.4 million jobs that have been lost will be nearly 2% increase froma last year’s more rigorous lending standards. As Tom Ruff, an analyst with Information Market 1988 10.34 % 2008 6.03 % economy fails to grow, or contracts. recaptured. says, “The new loans coming into the pool have made it through strict underwriting 1989 10.32 % 2009 5.04 % 2011 has given us a 1% - 2% rate of growth, depending on the protocol while the bad loans just keep getting sent to the courthouse steps, and r potential homebuyers wrestling with the decision on the best time to buy, it appears to be NOW. For even if home prices experience another 5% to 10% decline, the cost-of-money to borrow at higher rates the longer you wait may just offset any monthly 1990 10.13 % 2010 4.69 % quarter. Generally recoveries from recessions have been closer once they’re foreclosed, they’re no longer delinquent. Good in, bad out.”

1991 9.25 % Source: Freddie Mac vings you might see.

For every point that interest go upand onthean 80% loan, thespecifically, effective Arizona, Metro Phoenix market haveprice of the home goes up about 10% due to what the difference in payments would amortize. to the 4% or 5% range in GDP growth, but this modest growth rates been hit worse than most other markets in the US. Our housing is growth nonetheless. A clear signal that the recession truly market has fallen harder, population growth has spiraled to is over. r sellers, waiting to put your home on the market until prices rise may also offset any gain you’d have. Your pool of potential buyers will be different. Many won’t qualify at the higher rates when they would have qualified today. Additionally, If you’ll Source: Information Market be Source: Freddie Mac historic lows, and in 2009 Arizona (generally always in the top purchasing then you’ll too be financing at the higher rates westates) willsank have. five growth to 49th out of 50 states when measuring As the economy accelerated into 2011, national claims for employment growth.

Source: Information Market MONTH RESIDENTIAL NOTICE RESIDENTIAL MONTH RESIDENTIAL NOTICE RESIDENTIAL dropped at the end of 2010 to the lowest level in However bleak our decline, Arizona is regaining ground.

RIZONAjobless ONbenefits SALE

OF TRUSTEES SALE FORECLOSED

OF TRUSTEES SALE FORECLOSED two years. The Institute for Supply Management-Chicago Inc. By the end of 2010, Arizona had added jobs for four months in December 5,475 3,283 December 7,405 4,792 reported its business barometer ended 2010 at 68.6 (a figure a row, dropping unemployment from 9.5% to 9.4%, while the hether it’s a clearance on signifies a high-quality an rose investor “buying lowsame totime sell high,” savvy shoppers know to capitalize on an opportunity to buy aNovember valued item at 5,607 a huge discount. And real estate is6,679 priced very low3,485 right now, the 2,509 while Arizona November greater than 50 on thesale barometer an expansion),pair whichof shoes, nation as or a whole from 9.6% to 9.8% in that is the highest level in over two decades. period.

The state is expected to add 48,000 jobs in 2011 and October 6,728 4,034 October 7,303 4,444 ost important factor indicative of a good investment is the potential value and worth. If you subscribe to the belief that Arizona is a highly desirable destination and will be in much demand in the decades to come, than buying property in today’s market may After more than three years of “forced frugality” among recent data shows that Arizona has become the number-one September 7,116 4,877 September 7,408 3,432 the wisest move you can make for your future wealth portfolio.

American consumers, it seems that shoppers are weary of fastest-growing market for private sector jobs. Metropolitan August 7,186 4,831 August 8,624 3,546 non-spending. Holiday 2010 purchasing rose a fantastic 5.5% Phoenix is now ranked second in highest job growth among July 7,804 4,651 July 8,671 4,711 according to the MasterCard Advisors SpendingPulse report. large cities, only lagging behind Washington, D.C. June 5,833 4,584 June 8,138 4,688 Exceeding even the most optimistic retail spending forecasts, “2011 is going to be the best year for Arizona’s economic May 6,106 3,841 May 8,126 3,472 the rate of spending during the 2010 holiday season was the growth in the past three years,” stated ASU economist Lee April 6,634 4,115 April 8,552 3,787 highest since 2005 – that banner year for the economy.

McPheters at the 47th annual forecast luncheon sponsored by March 7,625 5,127 March 10,077 3,023 With consumer spending elevated, manufacturing will see ASU and JP Morgan Chase Bank. “I think it’s pretty clear we’re February 7,179 3,891 February 8,000 4,780 an uptick as retailers will need to restock shelves. Business on the threshold of recovery. Arizona is much stronger than it spending is expected to further increase in 2011 and into was a year ago,” he continued.

January 6,344 4,065 January 8,158 3,832 2012 as well.

Total: 79,637 49,808 Total: 97,141 47,992

Distressed Properties Easing Up

Arizona On Sale

Arizona Outpacing The Nation?

2010

2009

Monthly Foreclosure Activity In Maricopa County

An Economy On The Mend

Paula Young With over 30 years in the real estate industry, I have had the opportunity to sharpen my skills and knowledge, and offer a combination of expertise and experience that is so critical to achieve the results we all want. For your success is my success.

Many of my years in the industry have been spent in the Seattle area. I started as a realtor and broker then decided I wanted to learn more about the financing of real estate and worked in the mortgage lending industry for several years and achieved a position of branch manager of one of U.S. Banks largest mortgage divisions.

I moved to the beautiful Phoenix area nearly a decade ago planning to retire from a wonderful career but that was short lived. I love real estate and being of service gives me great satisfaction.

As Arizona is a highly desirable destination, I have had the opportunity to work with many fellow Washingtonians to find the community and home that fit their lifestyle. It would be an honor to help you find the home of your dreams, or a second home or perhaps just a great investment. If you are a real estate agent and have clients considering the Phoenix area, refer them to me. You can be assured they will get the level of service you can be proud of.

I believe that one of the best tools I can offer my clients is information. Metro Phoenix Economic Snapshot 2011 has been developed to familiarize you with the Phoenix marketplace and the many opportunities that now exist in real estate. The Phoenix/Scottsdale area will continue to be in demand for decades to come. Let me help you make one of the smartest and successful purchases, perhaps, in your lifetime!

Give me a call today!

M E T R O

2011 YTD Average Sales Price By City CITY SINGLE-FAMILY CONDOS &

RESIDENCES ONLY PATIO HOMES ONLY Glendale......................................... $114,591...............................$44,555 Phoenix............................................ $128,199...............................$80,651 Mesa................................................ $144,521...............................$61,697 Peoria.............................................. $166,393.............................$118,532 Tempe.............................................. $177,165.............................$114,051 Gilbert.............................................. $187,762...............................$70,416 Litchfield Park.................................. $192,548...............................$74,103 Chandler......................................... $199,796...............................$75,576 Cave Creek.................................... $331,569.............................$198,580 Fountain Hills................................... $423,910.............................$170,870 Scottsdale....................................... $497,938.............................$191,980 Carefree.......................................... $656,309.............................$229,125 Paradise Valley............................ $1,396,849...............................$97,106

Testimonials “Paula is a quality, caring person and will give you excellent service when buying or selling real estate. She will find what you want whether it be a home or investment property. Her motto is to give the highest level of customer satisfaction, and she certainly delivers.”

— Marlene and Alan Lomax, Bellevue “Paula Young is the agent you want to be working for you in selling or buying your home.

Being an agent in the Seattle area myself, I have referred many buyers to her. She does a great job of listening to her buyer’s needs and takes the time to help them get what they really want. Personally I hired her to list my second home in the Phoenix area and had it sold in an amazing amount of time.” — Dawn Sullivan, John L. Scott Real Estate

“I am happy to recommend Paula Young to anyone who is seeking to purchase real estate. Paula helped me find the perfect home. She proved to be highly professional and very organized. Paula continued to be extremely helpful throughout the negotiations and the entire closing process. In addition to being extremely knowledgeable, she demonstrated great attention to all the details to ensure that the sale and closing proceeded smoothly. She is bright, energetic and made the real estate search very enjoyable.

I heartily recommend her without reservation.” — Keith VanVelkinburgh, Christy Sports LLC

ReMax Sun Properties Direct: 602.478.6546 Fax: 480.816.1022 youngpaula@aol.com www.paulayoungproperties.com All agent referrals will be honored.

If your home is currently listed, this is not a solicitation for that listing.

M I D -Y E A R U P D AT E

Statistics gathered from ARMLS. All information is deemed reliable but not guaranteed.

“I have dealt with Paula on several transactions in the Phoenix area. She has always been very professional and provided superior service and knowledge. I would highly recommend her to anyone looking to purchase in the Phoenix area.”

— Michael and Cyndee Bassie, Kirkland

Paula Young

P H O E N I X

“When I first came to Arizona, I took it upon myself to search the valley to find a home.

After a week of diligent searching I found myself making an offer on a townhouse in Fountain Hills that Paula told me about during our initial conversation. Not only is she an expert in knowing her demographical area but, the needs and desires that will best fit your home expectations as well.” — Gregg Anderson, Absolute Mortgage “Thanks to Paula’s bulldog attitude we now have our dream retirement home. She listened to our likes and observed our lifestyle. Putting the two together, she walked us into our wonderful home. She has a real talent for finding the right home or investment for her clientele.” — Mike and Bea Cannon “Paula Young has the integrity and commitment to get the job done. Coming from out of state to purchase my retirement home was stressful. Paula was available the entire time, and definitely went beyond her duty seeing the task through. Paula had my best interest at heart and new excellent resources to accomplish any concerns. I value Paula as a committed realtor and have recommend her to my family and friends.”

— Linda Gray, Seattle

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

The Real Estate Market What’s Happening in 2011?

Unemployment Consumer Spending GDP Growth A Review of the Economy and What to Expect

Mortgage Interest Rates

A Look Back at the Good, the Bad and the Ugly