With the first quarter of 2022 in the books - and it was a wild one at that - I wanted to share some current market conditions as of April 1st, and also share some thoughts from some of our market and industry experts as we head into the 2nd quarter of the year.
The downward trend in supply that started in late October has reversed during March, and we are now seeing what appears to be a significant rising trend. However, this is not due to more incoming new listings - it is due to fewer active listings going under contract as quickly.
Here is an interesting chart showing average percentage of sales price compared with the final list price in various communities around the Phoenix metro area. Incredibly, only 2 are selling below list price!
After interest rates increased last week by 0.5%, Amber Kovarik, Senior Loan Officer with Guild Mortgage wrote, “This is an environment unlike anything we have ever seen. We have a gas crisis like the 70s, inflation of the 80s, a stock market correction like the late 90s, and housing affordability nose-diving like we had in the early 2000s. All of these independent events, up until now, have been unprecedented in their own right. Now they are all occurring at the same time. Nobody can know for certain what the FED is going to have to do to rates to stop inflation.”
According to the Wall Street Journal, Greater Phoenix is the metro area with the highest inflation rate in the country. From February 2021 to February 2022, Phoenix’s consumer price increase is at 10.9%! The national average is lower, but still an astounding 7.9%.
Inflation is defined as too much money chasing too few goods. At a time when production was low for everything, Maricopa County, the fourth most populated county in the country, grew more than any other U.S. county. The state as a whole gained 98,330 people from July 2020-July 2021. 90% of our growth came from out-of-state relocation.
I have been saying for months that the reason this market is not going to cool off anytime soon is that Maricopa County remains the fastest growing county in the country. A decade of under-building and massive population growth is a recipe for continued rising prices.
From the folks at The Cromford Report, the valley experts in real estate:
Don’t be fooled by the small increase in supply and decrease in demand compared to last year. The Greater Phoenix housing market is far from weak and will continue to see prices appreciate in the foreseeable future. Housing market indicators move slowly, unlike other types of investments such as stocks or currencies. When events such as interest rate hikes or stock market fluctuations occur, there isn’t an immediate measurable response in housing prices. Consumers may “panic sell” stocks, crypto, or even their belongings; however, selling the roof over their head or a performing rental is typically the last resort. For this reason, jolts to the economy (like a sudden pandemic or economic sanctions) need to be in effect for many months without improvement for housing to see prices finally respond.
Greater Phoenix is not even close to peaking in price for residential resale, certainly not with the supply of homes for sale at 76% below normal for March while demand sits at 13% above normal. However, be aware that the estimated payment for a 1,500-2,000 square foot home is now $77 higher than the median rent for a similar rental property leased through the Arizona Regional MLS. The rental market responds to a shift in demand faster than the resale market does because landlords are faster to respond with a lease price reduction if their investment is vacant for too long.
The health of the rental market is often looked at as an indicator of the health of the resale market. If lease rates continue to go up, and rentals are successfully closed at those rates, then that’s a good indicator for resale prices as well. When rental rates reach a ceiling and stay there for months, then it’s possible the resale market may follow, but as stated earlier, resale is slow to respond. It could take many more months before the shift is realized, so for today it’s business as usual.
All indications are that the second quarter of 2022 will be as strong as the first. Whether you are a buyer or a seller, The Kolb Team is here to help!
The Kolb Team
Covenants, Conditions and Restrictions (CC&Rs)
If you live in a house that is part of a homeowner’s association (HOA) you are subject to the rules listed in the Declaration of Covenants, Conditions and Restrictions (CC&Rs).
The CC&Rs describe the requirements and limitations of what you can do with your property. The goal of the CC&Rs is to protect, preserve, and enhance property values in the community.
If you violate the CC&Rs you could face penalties, like fines and various other consequences.
CC&Rs typically include restrictions and requirements on how you:
- Maintain your property. Again, the CC&Rs might require you to mow your lawn regularly, or the CC&Rs might state that you can't allow the exterior paint to peel. However, some HOAs provide lawn care and home maintenance services, like exterior painting. Other HOAs expect homeowners to stay on top of these tasks themselves.
- Decorate your home. The CC&Rs could dictate what color you may paint your house. Some HOAs limit homeowners' color choices to various shades of certain colors.
- Keep pets. Some CC&Rs prohibit specific pets, like livestock (which includes goats and chickens) or certain dog breeds, or limit the number of pets you can own.
- Park your vehicles. CC&Rs sometimes prohibit vehicle parking on the streets and limit overnight guest parking. Some HOAs even stipulate that company-branded vehicles cannot be parked within the community.
- Store your garbage cans or other unsightly items. The CC&Rs might require that trash containers, utility meters, and clotheslines be enclosed or appropriately hidden from view.
And, of course, the HOA might have other requirements as well. The CC&Rs could restrict the height of your fence, require a defensible space for fire protection, or prohibit political signs, among other things. You’ll want to make sure the applicable CC&Rs are all things you’re willing to live with!
“I Could Not Be More Pleased!”
Chandler Rotary Fundraising Event
As most of you know, I am very active in the Rotary Club of Chandler, and I am very passionate about the great things our club does for the community. In fact, for each listing we sell, The Kolb Team gives $100 to the Rotary Foundation, which is doing amazing service projects all over the world.
I would like to invite all of our local friends and clients to the primary annual fundraiser called Chandler Rotary Flight Night on April 28th at 5:30pm at the QuartHaus in downtown Chandler. There will be beer tasting from local brewers, a reverse raffle, raffle prizes, a silent auction, live music, food trucks, and other fun activities at the venue.
We are raising funds for local veterans’ groups, as well as for scholarships to benefit local students who want to go to trade school or community college. There are sponsorship opportunities for this event as well. I hope you can make it and bring some friends along too! Event link: https://www.givsum.com/opportunities/2022-chandler-rotary-flight-night-4f7635e76
Recipe of the Month
Sweet Potato Fries w/ Basil Mayo Sauce
- 5 sweet potatoes, cut into 1” by 5” fries
- 3 Tbsp olive oil
- 2 Tbsp fresh basil leaves, chopped
- 2 tsp kosher salt
- ½ tsp freshly ground black pepper
- ¾ cup mayonnaise
- 1 clove of garlic, minced
- 1 Tbsp lemon juice
- Preheat oven to 400°F or use air fryer (if you prefer)
- Place the sweet potato fries on a foil-lined baking sheet and toss with the olive oil. Bake until golden, about 45 minutes in the oven.
- Combine the basil, salt, and pepper in a small bowl to create seasoning for fries. In another small bowl, combine the mayo, garlic, and lemon juice to create a dipping sauce, and stir to combine.
- When fries come out of the oven or air fryer, sprinkle with the basil salt. Serve with the garlic mayonnaise alongside for dipping.
Here are what people are saying about our Shred A Thon!
Congratulations to our Starbucks Gift Card Winners:
- J. TenBroeck
- M. McCoy
- F. Webster
- R. Keltner
- D. Galiger
- B. Starley
- K. Corbett
- M. Morrell
- D. Schut
- R. Chierici
- J. Sadkin
- Buyer in search of Sienna model with a view.
- Buyer looking for a 2100-2500 sq ft home with a nice backyard, prefers updated.
- Buyers looking for a single level home with 3 bedrooms and a 3-car garage in one of the gated communities.
- Buyers looking in Sun Lakes Phase 1 for something updated with 2 bedrooms and space for a workshop, with a 2-car garage.
Recent Real Estate Sales in Sun Lakes
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).
Sun Lakes Community Theatre
You’ll Want to Catch Sun Lakes Community Theater… If You Can!
Sun Lakes Community Theatre’s spring show is an exciting mix of mystery, thriller, and comedy, and it’s called “Catch Me If You Can”! Director Diana Nelinson is at the helm of this play, first focused on a honeymooning couple with a missing new wife, but you’ll have to see it yourself to know what happens after that.
The San Tan Ballroom in Cottonwood
Wednesday, April 27th – Sunday, May 1st
Showtimes: Wed – Sat: 7pm
Sun matinee: 1pm
The ImproVables Return from Their Pandemic Pause! And They Need YOUR Help!
Sun Lakes Community Theatre’s comedy improv troupe is back! Since a successful improvisational show relies on audience involvement, they’ll need you there to provide suggestions and ideas for them to riff sketches and hysterical scenes! You’re certain to enjoy the antics, all brought to you with no scripts and no rehearsals!
The Saguaro Room in Cottonwood
Friday, April 22nd
Doors Open: 5pm
Show plus buffet dinner tickets available for just $25 from HOA Administrative Office in Cottonwood
Arizona Sliding Door
Sliding door repair is no easy task, but Arizona Sliding Door will get you rolling. They specialize in repair and reconditioning of sliding doors, no matter their shape or size. If your sliding door is suffering problems from tracks to rollers, or handles and locks, Arizona Sliding Door will repair all your sliding door problems!
We are a family-run business specializing it prompt, reliable service, and we guarantee our work for 3 years. Located in Chandler, AZ, Arizona Sliding Door is available for service throughout the Phoenix Valley Metro area. You will be amazed and satisfied when they deliver fast and professional sliding door repair and service!