Talking Inventory & Prices
All that anyone in real estate is talking about is low inventory and rapidly rising prices. Let’s dive in to this important subject, again! US home prices nationwide are up an unsustainable annual rate of 14.8%. According to Black Knight (a leading data analytics firm for the mortgage and home equity lending industry), we are currently seeing the highest home price growth rate ever seen in records going back nearly 30 years. The graphic below shows the annual growth rate by state for the period ending in April 2021.
The top 10 metro markets with the strongest price appreciation were:
- Austin, Texas (24.9 percent)
- Phoenix, Arizona (24.4 percent)
- Riverside, California (22.3 percent)
- Seattle, Washington (20.8 percent)
- Sacramento, California (20.8 percent)
- San Diego, California (20.1 percent)
- Salt Lake City, Utah (19.9 percent)
- Providence, Rhode Island (18.1 percent)
- Tampa, Florida (17.3 percent)
- Jacksonville, Florida (17.0 percent)
Among the 50 largest housing markets, the 10 markets with weakest price appreciation were:
- Louis, Missouri (11.6 percent)
- San Antonio, Texas (11.6 percent)
- Orlando, Florida (11.0 percent)
- New Orleans, Louisiana (10.9 percent)
- Minneapolis, Minnesota (10.8 percent)
- Birmingham, Alabama (10.8 percent)
- Houston, Texas (10.3 percent)
- Oklahoma City, Oklahoma (10.0 percent)
- Chicago, Illinois (9.9 percent)
- Pittsburgh, Pennsylvania (8.1 percent)
Western states are setting the pace with every single state above 12%, and several above 20%. Sun Lakes is currently up 15.7% annually. Current levels of home price growth are not sustainable, though, especially if interest rates begin to rise as predicted. A key indicator is the payment-to-income ratio that measures affordability in the housing market. That ratio has averaged 23.6% over the past 25 years. The current rate is 20.5%, and as interest rates creep up, that rising ratio should trigger a tipping point where home appreciation begins to slow. According to Black Knight, if rates on 30-year fixed-rate loans rise to 3.5% by the end of 2022, the national payment-to-income ratio would hit 21.6% by the end of this year, and 25% by 2022. So… yes, low interest rates are fueling the housing demand, but low inventory is the real driver of price increases.
Nationwide, the total number of active listings is down 60% from the 2017-2019 average for April. That equates to almost 750,000 fewer homes on the market than we have in a “normal” year. Greater Phoenix is no different, with under 5,000 active listings - and in case you are wondering, at the time this article was written, there were only 13 active listings in Sun Lakes, down over 70% from normal early summer levels.
There are signs that the market may be starting to slow, at least on a national level. In the past week, single-family inventory increased by 10,000 listings or 3%. This is the biggest increase in new inventory since June of 2019. That is a three-week trend of increasing inventory, and since it takes three weeks to see a trend, we’d say it’s a trend! Nationwide, during normal market cycles, inventory tends to peak around August. You should expect more slow increases in inventory in the coming weeks, and it will likely take years to get to normal levels. The market velocity is still ferocious, though, with 88% of homes selling in under 30 days. Last week, just over 29,500 listings sold in less than 24 hours; this week it was just shy of 27,000! Homes are staying active only hours longer than in previous weeks. Yes folks, we have come to measuring this market in hours!
It is still a great time to list, and, honestly, it can be a frustrating time to be looking to buy, but The Kolb Team is here to help you make the experience as comfortable and enjoyable as possible.
RESPA
First, the directive of the Real Estate Settlement Procedures Act, or RESPA, is to make certain disclosures within or during the real estate settlement process, which allows home buyers to make informed decisions regarding their property transactions.
Second, RESPA prohibits certain unlawful practices by real estate settlement providers, such as kickbacks and referral fees (both of which can potentially increase settlement costs for buyers). RESPA is also called Regulation X.
The Purpose of RESPA
The purpose of RESPA is to govern the real estate settlement process. It commands the parties involved to fully inform borrowers about all closing costs, and also governs lender servicing, escrow account practices, and business relationships between closing service providers and other parties to the transaction.
What does The Real Estate Settlement Procedures Act Cover?
RESPA (or Regulation X) covers mortgage loans on a one-to-four family residential dwelling. Most purchase loans, assumptions, refinances and property improvement loans are included under this category. Finally, this also includes equity lines of credit. RESPA regulates the use of escrow accounts and restricts sellers from mandating title insurance companies.
Final Thoughts About RESPA
These five letters can influence your financial well-being when you are buying a home. Additionally, according to HUD (Housing and Urban Development), the goal of Regulation X is to clarify and outline the settlement process and fees to consumers, and the elimination of illegal activity such as kickbacks and referral fees among settlement service providers. As a side note, HUD's responsibility for enforcing RESPA ended in 2010 by the entity transferring its authority to the CFPB (Consumer Financial Protection Bureau), due to the Dodd-Frank Wall Street Reform and Consumer Protection Act.
For more information, just email us at info@thekolbteam.com.
Searching for That Perfect Home?
When looking at pictures online, it can be tricky to figure out the layout of a home. We can help you with that! On our website, you can access the most popular floor plans in Sun Lakes, AZ. Just click the button below!
Not All Realtors® Are Created Equal!
When it comes to quality of service, The Kolb Team does more for you!
- Our team knows the local active adult communities better than anyone else because all of us live, work, volunteer, and play in Sun Lakes.
- We have a full-time licensed real estate assistant to help with all steps of the transaction to make sure you don’t miss any costly deadlines, avoid delayed closings, and reduce your stress.
- We forge relationships with our clients, and we go the extra mile to help with signing and we even drive our clients to appointments and more.
- Unlike other agents, we return all phone calls and messages promptly.
- We have a vast network of trusted and time-tested vendors for everything you need to prepare your house for sale, including repairs, and we help coordinate it all even if you are out of the area.
- We offer the most competitive commission rates in Sun Lakes.
- Other agents might offer discounts and little service. We offer the most competitive rates and never discount our service.
To us you are more than a transaction. Experience the difference!
Recipe of the Month
Asian Chicken Salad
Here is a fun easy recipe you can make with the grandkids.
Ingredients:
- 1 bunch of green onions
- 1 cup sunflower seeds
- ½ c slivered almonds
- 3 pkgs ramen noodles, chicken flavored
- 3 cups cooked chicken, cubed
- 1 shredded cabbage
Shake the following together to make an authentic dressing for the Asian Chicken Salad:
- 2 T sugar
- ¼ cup red wine vinegar
- ½ cup oil
- 3 pkgs ramen noodle seasoning (chicken flavored)
Vendor of the Month
Palladino’s is a full-service cleaning company for your in-home and outside needs. Plus, they haul away junk, and clean your tile and grout, windows and walls! There is nothing they won’t clean. Call 602-432-4345 or visit Palladino’s Professional Cleaning Services, LLC at their online home
- Buyer looking to downsize. 1,000 - 1500 Sq Ft. Would like a nice patio space.
- Buyers from the Midwest looking for a 2+ bedroom home with a den. Pool is fine.
- Buyer looking for a home with a view of the golf course or water or both. Would prefer N/S exposure. Would like it updated.
- Buyer looking in Sun Lakes for a home with a pool. Would like a den or 3rd bedroom.
The City of Chandler
Just a bit north of our beloved Sun Lakes… lies Chandler. There is so much to know about this Arizona city, and we’d like to share just a bit about our 15-minutes-to-the-northeast neighbor.
Did you know the city of Chandler utilizes 22 wells? The most senior, water-for-drinking well is called the Erie, and it’s been in service since 1948. Since then, it has produced over 8.5 billion gallons of drinking water. Who famous can you name that lives in Chandler? Many famous faces make Chandler their home, including Donovan McNabb (former Minnesota Vikings QB) and rapper-actor Ice-T and his wife Coco Austin. Have any award-nominated movies featured Chandler locations? Yes! Waiting To Exhale and Little Miss Sunshine are the best known and most famous! A long shot… but any famous boxers? Actually, yes! Zora Folley was a former Chandler Council member who fought the one-and-only, Muhammad Ali. What about the tech industry players in Chandler? Well, the city is not called, The High-Tech Oasis of the Silicon Desert, for nothing, ok?!
Clearly, Chandler, our northerly neighbor, has a rich history, and an interesting future. Look at all this information, made available to us online! The Chandler Library is hosting the video of Zora Folley vs Muhammad Ali on March 22, 1967. Did you even know Ali fought a Chandler-native?! If you want to see a vintage boxing match, that is the link for you!
Lindsay, also from the library, has an easy and quick project that you can donate to your local animal shelter or rescue. Whether you’re a cat or dog person, this seriously-cute blanket will find a useful life with whatever furry friends you send it to https://www.youtube.com/watch?v=rNjtnRRnobE. In fact, the Chandler Public Library YouTube page has many projects and links you’ll want to check out! Let’s not forget the Gilbert farmer’s markets – at Greenhouse Gardens and Gilbert Farmers Market (GFM). How about some Western American and American Indian Art by local artists? You’ll want to keep https://www.visitchandler.com/things-to-do/arts-museums/art-galleries/ handy! Are you aware of the 1894 Lowell Expedition to Arizona? Which led to the founding of the Lowell Observatory? Kevin Schindler, an Historian, shares the incredible story, and how it connects to Mars study, here: https://www.youtube.com/watch?v=cdf9KEXUfrk.
Just a short skip east and a bit north, the city of Chandler has a rich history to explore. Some of the events are available online, but with others… like the Ostrich Festival (more information coming soon)… you’ll want to be there in person (when COVID-19 restrictions and concerns ease even more).
See What Our Clients Are Saying!
“They are very professional, knowledgeable, and efficient and they were successful in selling our home.”
Jerry and Jan
- Colorado
We Are Committed to Helping End Polio Now!
We will donate $100 in your name to end polio around the world, when you list your home for sale with us!
You may also donate directly here
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Real Estate Update
Wondering about your Neighbor’s Home Sales Price? Find out here to see what sold last month. The report is broken down by HOA, address, and floor plan (if the agent listed the model in MLS).