I hope 2021 has been off to a great start for you!

If you have any big plans for the year, you might be interested in this famous quote by Benjamin Franklin, “If you fail to plan, you plan to fail.”

I would add, “Plan Early.” We know that the sooner you get started, the more likely you are to ultimately succeed.

As we move into 2021 this early in the year, figuring out what will happen this year may be difficult at best.

My Goals, 
Be there for you of course and then try to make up for a few of the missed hikes and trips with family.

Before I get into Real Estate, I wanted to welcome Renee Gaun.
Renee and I will be teaming together as the new year begins.   Renee is just coming to the office, so watch for more about and from Renee in the months to come.

Now to the World of Real Estate;

Below, I will cover the past year's Real Estate Sales history, and it was one for the record books.

But what will happen in 2021?
We have talked to a lot here at Realty Executives of Flagstaff
All indicators show that if we have the available homes to sell, it will be another great year for both the Buyers and Sellers.

There are positives on all sides
The Buyers Side,
Interest rates are at historic low levels and are expected to hold that course. Lenders are out there willing and waiting to help you on the lending side of  the purchase. I cannot say enough about the interest rates and the buying power this brings to the Buyers.
The Sellers Side,
With the extreme low level of homes on the market, am not sure there will be a better time to sell. I should rephrase that, though no one can look past tomorrow, we can look back even over the past 4 months. There has not been a better time to sell and I do not see this changing moving forward through 2021.
Even though we are still in the dead of winter, you should not be afraid to move forward with your plans. Those that are putting their homes on the market this past month are being pleasantly surprised with their final outcome.
If you have that second home you have not been using as much, this would be a good time to make that change.
With the tightness of inventory over the past few years, there is an increasing number of buyers that want to get out from under those rent increases year after year and take advantage of these current interest rates.
There are a few things to consider when selling, you should reach out to me about those.

I’m here to help whenever you have questions or need advice that’s real estate-related. Even if you need a contractor recommendation, I can help. Feel free to reach out to me anytime.

Below, you will see a detailed summary of the 2020 housing year in the general Flagstaff area.

Bottom line,

For all home types in the General Flagstaff area
24.7%, more homes were sold in 2020
4.2%, more homes came to the market in Flagstaff
11.5%, was our median price increase in homes 
1.52, months supply of homes on-hand, this would be considered our Absorption Rate.
65, The total number of homes of all kinds, Single Family Condo, Townhome and Manufactured, on the market as of Monday January 4th.

The following chart will run down these stats for each of the home categories.

What is this telling us?
We did have more homes come to the market this year than last, but sold even more homes this year than last year, it was a true Sellers Market.

With 4.2% more coming to the market, but selling 24.7% more homes, and at only 65 homes on the market today, we have drained any reserve in available homes we may have had.

 If all things stay equal and no new downside events happen;
I said above, we can have a good year in 2021, and still feel that way.

We had more homes come to the market in 2020, even in a Covid year. With things hoping to improve in 2021, vaccines getting out, and a new normal coming at some point, we are expecting 5-10% increase in the number of homes coming to the market.
With the pent up demand we have from buyers, this 5-10% will get snapped up right away. We do not  have the reserve out there like we did in 2020, so more than likely that may be our increase for 2021.

To Home Prices;

Looking at the numbers above and in the chart below, you will see home prices increased for all home types by 11.5% and just for single family by 15.9% increase.
With that said, we need to take a step back a bit!
What was not included above or below was what happened in our Gated Golf Communities: Forest Highlands, Flagstaff Ranch, and Pine Canyon.
those communities accounted for 19.5% of our single family homes sales, they had a 19.1% increase in prices and sold 103% more homes or more than double the year before.

When we take those Gate Community homes out of the pricing equation,
8.6%, increase in prices for all home types, compared to the 11.5% when you include the gated communities.
10.8%, increase in prices for Single Family homes, compared to the 15.9% when you include the gated communities.

Pricing may trend toward these adjusted figures for 2021 for homes outside the gated communities.
In a nutshell, that was 2020, and what we expect in the Real Estate world for 2021.
You know I am here for you, so please reach out. Even if not to talk Real Estate, have a new hobby coming, BikePacking so would love to talk about that.

Best Wishes as we move into 2021, and look forward hearing from you.

Jeff

 About the Author:

What is Happening? In the Flagstaff Housing

A lot is happening in Housing in Flagstaff!

I get asked on a daily basis, what is actually happening? In Real Estate today.

There are no simple answers but there are some facts that can help give us some direction in what is Happening?

With that, I went back 11 years in Real Estate to 2010, then came forward year by year. For the most part figures will be through November each year unless otherwise noted. So back in 2010, We sold 787 homes or -9.6 % fewer than the year before. At that time, we had 908 homes on the market down -2% from the year before Our Median Price on all homes, Single family, Townhome, Condo, and Manufactured, was $225,000 down -10% for the full year The Most Telling, our Absorption Rate, (the number of months (using average home sales volume) to sell every month on the market), was 12.37 months, over a year! TODAY, 1.7 months

The Absorption Rate is one of the best numbers to use to gauge a healthy market. Experts in Real Estate feel 6 months is healthy, more and it is a Buyer’s Market, less and a Seller’s Market.
Let’s look at every year since 2010

2010---12.37 months’ supply on-hand, this is more than a year’s supply
2011---9.96
2012---6.35
2013---5.79
2014---5.37
2015---4.43
2016---3.82
2017---4.08
2018---4.06
2019---4.40
2020---1.7 month’s supply on-hand, just under 2 months, Hard to say if we have ever been at this figure.

It has been 8 years since we have been at a Balanced Market or 6 months’ supply on hand.
Over the past 11 years, the supply of homes has only increased 2 years from the previous year.

More telling,

Thru November of this year, 2020
We have sold 1738 homes or 24.2% MORE homes than 2019
Year to date through December 6th, we have had 15 more homes come to the market then last year.
Our Median price again thru December 6, 2020 is at $410,000 or a 10.8% increase for all home types, Single Family, Townhome, Condo and Manufactured.

One thing we hear, fewer homes are coming to the Market, but the FACTS just do not show this to be true. It is close but still a positive number.

So what has happened,
Here is what we do know.

• We have had a declining availability of homes 8 of the past 10 years.
•  On top of that, interest rates today are at historic low Levels, giving buyers more buying power than they ever had.
• New Construction came to almost a halt from about 2007 through 2015
• Older Homeowners that normally downsized have not been able to find that smaller home for one reason or another, so have stayed put.
•  Covid-19 did slow people down from putting their homes on the market.
• We have a tremendous backlog of Buyers looking for that right home, could be the largest backlog we have seen in years, at least 11.

With all these points, am not sure we can point to any one reason as to how we got to 1.7 months’ supply of homes.

What do we see coming? • New Home Construction is out there but not enough to completely solve our shortfall • They are saying Nationwide, that once the Covid-19 Vaccine comes into play, homeowners that have held off selling, may be getting their homes on the market • 2nd homeowners that have not been using their 2nd homes as much for assorted reasons, may see this as an opportune time to sell during this housing shortfall.

What Now?

Buyers
There is still opportunity but will take patience and persistence. Your Real Estate Agent may want to be working full-time, so they can spot and get you out to homes, within reason, at a moment’s notice.

Sellers
What we do know, today is one of the most opportune times to sell. 
Homes are getting numerous showings and multiple offers. Though price is at the top of the list in deciding which offer is best, there are 20+ other points in the Purchase Contract that also help make that final deciding decision. 
Honestly, this is where you need me the most, A Full Time agent that will help you look at all the key points in a purchase contract to come up with the best offer for you and your family.

As with all my Newsletters, they are questions left unanswered, so please, please never hesitate to reach out with those questions.
I look forward visiting with each of you as we moving into a New Year.

Best Wishes and have a Great Holiday Season

Jeff

About the Author:

The community of Flagstaff has always been animal friendly. This year saw the animal lovers in the area shine as they made sure companion animals were well cared for. In particular, High Country Humane saw an outpouring of love and care. There were foster families who responded without hesitation when asked to care for bottle babies, both canine and feline, and provide that extra level of care for medical cases and senior animals. There were also donors who generously opened their wallets to ensure that needed additional resources were always available. And last but not least, the wonderful volunteers who willingly gave their time and energy and care. And all this care and support was coordinated by the hard-working, compassionate staff at High Country Humane, which includes a full-time in-house veterinary team.

Some of their remarkable achievements include:

• 2,692 animals taken in so far in 2020
• 1,923 of those adopted into new homes and 409 returned to their owners
• A “Live Release Rate” of 97.3%, meaning that of the animals who entered High Country Humane, 97.3% were either adopted, returned to their owners, or transferred to another shelter or rescue.

Another feature offered by High Country Humane is their Pet Food Pantry. One of the most common reasons pet owners give up their companion is financial hardship. The HCH Pet Food Pantry is designed to help struggling families keep beloved pets in their homes. The pantry is supported entirely through community donations.

There is also the Working Cats Program. This program was designed to help feral or stray cats who can’t be adopted into traditional homes, but who still need a protected or sheltered living arrangement. The program places these cats in barns, flower shops, police stations, and other businesses looking for inexpensive, safe, and effective rodent control.

While 2020 has been a year unlike any other, there has been much to be grateful for and acknowledged when it comes to animal care in the Flagstaff community!

Want to know more? Check out High Country Humane's website.

Lending, Why Working with a Local Lender May Help Your Offer

This environment has widened the gap of ‘winners’ and ‘losers’ when it comes to obtaining a home. It was recently asked.  “How can local lenders be seen as a competitive advantage in this market?” and this is what we will attempt to answer in bullet points below!

1. A seasoned local lender will anticipate the Known Issues to our areas before they arise whereas a non-local   lender simple doesn’t know what they haven’t yet experienced.
   1. The local lenders know the appraisal time frames in our area and have preapproved panels of only the best area local appraisers. For example, local lenders will only pick the top performing out of the 20 or so available in Flagstaff.
   2. Local Lenders know property specific concerns that range from utility requirements (septic, water haul, wells etc) to location and access issues (road maintenance agreements, forest service road access etc) and can resolve upfront before these postpone or derail transactions.
2. Local lenders have a team from start to finish that understands Northern Arizona.
   1. Local lenders typically have processors and underwriters that are familiar with the area or work exclusively in this area so they understand how employment aspects, property aspects and overall logistics work for real estate transactions in the market you’re purchasing. Out of state and out of area lenders often struggle to grasp certain issues and can decline financing where area-focused processing and underwriting work easily through the system.
3. Local Lenders are a known commodity.
   1. There are over 20 different factors that a seller may consider when an offer is presented, the Highest and Best offer is not necessarily the only deciding factor. Lending is a significant factor when sellers contemplate when accepting an offer, thus taking their home off the market. Though it would be great if ‘all lenders were created equal’, it is the unfortunate experience that out of area and unknown lending entities could pose a risk to the seller as they are an unknown commodity. With strong track records of performance and a dedication to the local real estate industry’s success, local lenders are a known commodity that then offer a competitive advantage on an offer. The Local lender also understands they are expected to Close on Time, or the next Seller/Buyer will not come their way.
4. Lastly, it’s detailed and personal!
   1. This may sound like ‘fluff’ but most local lenders are going to work to specifically understand YOU and YOUR NEEDS and not treat you like another number or transaction. This not only means that you’re likely to get the proper advice and direction upfront during home shopping (which can be extremely critical!) and a smoother transaction through the processes but it also means that when obstacles arise you have some one that is personally fighting for you as a member of your real estate team.
   2. The Listing Agent most likely knows the Local Loan Officer and having a positive past work experience with the Loan Officer can be critical. These listing agents remember which lenders/loan officers got the past buyers’ loans to fund on time and make the home closing process a smooth experience for them and their past clients.
   3. Funding Loans with no delay on closings is a positive impression the real estate agent carries forward in factoring buyers’ lenders in a competitive real estate market with multiple buyers on the same property. The personal Call the Local Loan Officer makes to the listing agent touting the strong buyer and no worries on the loan funding is a big endorsement to give our buyers an edge against the competition.

Happy autumn. Let’s hope the coming season treats us all well!

Speaking of seasons, you may have noticed that in most cases the real estate market seems to have seasons. Traditionally, it’s slower in some months and busier in others. In fact, that might lead you to try to “time” the market and sell when it’s hot. But, be careful. Like the weather, the real estate market can be unpredictable. Yes, it is a hot market today and it may or should be active next spring – but, then again, it could be slow. There’s no way to know for sure.

In fact, the best criteria for deciding whether or not to sell your property isn’t as much the market as it is your personal wishes. If you want to move within the next couple of months, there are ways to make that happen. So, don’t let market conditions delay or derail your plans. Properties sell in all kinds of markets, and yours can too. When I go on my listing presentations, one question I get asked is how is it your home marketed on-line.

Did you know, 93% of people visit websites when searching for homes.

(National Association of Realtors)

Visiting a website and looking for the most lucrative offers available seems to be the best option for nearly all age groups. The older millennials (29-38) seem to be leading the pack again with a staggering 98% of internet-relying home buyers. Real estate industry statistics confirm predictions that the members of the so-called Silent Generation push in a different direction. While 72% of them turn to website searches, about 86% of old-timers prefer to consult with a real estate agent. Nearly half of all buyers (46%) get informed through yard signs, and slightly more than that go to open house events.

So with that said, with some help from Realty Executives, I dug up many of the websites that your home may show up on, along with Social Media sites.

Because Realty Executives is Nation and World-Wide, and have resources beyond our local Northern Arizona Association  of Realtors, the list of sites can be rather mind boggling.

If you have any thoughts of selling a home over the next 6 months, or even over the next year, even though at least here in Flagstaff we are headed into Winter, it is a good time.
The market has not changed and is continuing the trend of few homes on the market with more buyers on the market, making for a good time to sell.

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