Question from Homeowner:
"Mary, I am concerned by the sudden increase in homes for sale in Wigwam Creek North?  Will he have another sudden drop in the market like we did in the past?"
Hi Homeowner,
I saw your question regarding the Wigwam Creek market so I ran the numbers.
Currently 18 homes are for sale in Wigwam Creek North. When I sift thru the taxes on these homes, I can see that 12 of these owners bought the house as an investment when the prices were lower. These owners are trying to make a substantial profit. The 6 remaining owners are trying to break even or minimize their loss.
In the past 30 days, 5 homes have closed escrow in Wigwam Creek North. This means we have 3.6 months of inventory in Wigwam Creek North. This indicates the area is still in a seller's market. As we move closer to the 6 month of inventory mark, the seller has less and less bargaining power. Around the 6-7 month inventory level we consider it a balanced market.
Why have more homes come on the market? The price per sq ft in the surrounding communities, as well as in Wigwam Creek North, has been steadily rising. Those investors which may have over extended themselves, may now be looking to sell off some of their inventory because they are happy with the current profit margin.
As prices rise, houses will also stay on the market longer because the pool of buyer lessens. We have had tremendous growth in the number of sales and the rise in home values in the last year in the west valley. Goodyear sold the highest number of homes in the valley in the last quarter. Investors are seeing the wave and wish to take the ride. With the increase in the volume of sales, we have not seen a drop in value and we do not expect one. This is due to the number of new residents moving to the valley due to our economic growth. Home builders that suspended building for years, are now finishing out the communities they started. We are seeing an explosion of growth once again in the west valley.
Mary Drefs
Keller Williams Realty Professional Partners

Is It Cheaper to BUY Real Estate or RENT Real Estate ????

Currently it is 35% Cheaper to BUY than to RENT in the U.S., according to Trulia's Chief Economist, Jed Kelko.

This statistic is based on:

1) the Buyer staying in the house for at least 7 years so closing costs are spread over these years.
2) a national average of 4.8% mortgage interest rate.
3) the Buyer itemizes his/her tax deduction and deducts mortgage interest.

Last year it was 45% cheaper to Buy than to Rent in the US because the average mortgage interest rate was lower at 3.75%.

For Rents to be cheaper than Buying Real Estate, the mortgage interest rates would need to reach 10.5%.

Even though prices and mortgage interest rates are expected to rise again next year, it will still take a long time before we reach an average 10.5% interest rate in the U.S.

So, if Buying is a possibility and you plan to stay in one area for at least 7 years, the best economic decision would be to BUY Real Estate.

Want specific pricing information? Contact our Buyer Specialist, Mike Drefs, at 623-693-1505.

Will the Government Slowdown Affect Your Real Estate Deal?

FHA and VA are the most commonly affected programs as they are funded by the government. However, there is no change to the ability to complete VA or FHA loans due to the government shut down. Both departments will continue to operate and since most of what is needed is automatic, there should be little noticed as a result of the shutdown.

• Word of Caution – if the file has a “hair” on it or is difficult and an UW needs to speak to a live FHA person or get a specific answer from FHA – this is where it could take a bit longer. Normally they return calls and answer questions in 24-48 hours, with the shutdown and running a “skeleton” crew for FHA, then plan for longer time.
• I would give the deals an extra week or so to close if the government shutdown continues longer than the next few days.