Bloodhound News: Sky falls
as predicted, none injured...

As has been persistently predicted for more than 18 months, the sky has at last fallen in the Phoenix real estate market. This per the Arizona Republic. The median price for residential housing actually went down by one percentage point in October, the first time this has happened since December of 2003.

Obviously our market is a lot softer than it was six months ago, but this is not quite the calamity so long foretold. Recall, until very recently every other mountebank was seething about a bubble that was doomed to burst at any instant. Instead, we've had a slow progression back to a relatively normal market, with nary a whimper of hardship to be heard.

This is Greg, in the first of his real estate columns published by the Arizona Republic on October 14, 2005:

When newsmakers make pronouncements about the real-estate market, they are conflating everything with everything else: north Scottsdale with south Phoenix, the stately custom homes of Litchfield Park with the ramshackle trailers of Ellsworth Road in east Mesa. The total supply of available homes is up from where it was a few months ago, but not by much. Among the homes that are most avidly sought and most assiduously marketed, demand is still very high - and price pressure is still very strong.

Real estate is non-fungible. That's the fancy way of saying that no one home can be substituted for another. So, to say that homes in greater Phoenix appreciated by 47 percent from July 1, 2004, to June 30, 2005, is interesting, but it is not hugely revealing. It conflates too many unlike homes and neighborhoods to be valuable.

It's much more useful to note that the 1,603-square-foot Terracina floor plan in Ashton Ranch in Surprise appreciated by 67 percent in that same span of time. The 1,313-square-foot Vail floor plan in Rancho Santa Fe in Avondale was up 56 percent. The 1,273-square-foot Sterling model in Fletcher Heights in Peoria gained 56 percent in value.

Surely there is a net depreciation in values happening somewhere, but it's important to understand where. At the fringes the softness is pronounced--the very low and very high ends, along with niche products and less-prized options like mobile homes, co-ops, condos, etc. Homes and neighborhoods that were egregiously overpriced have given some ground. But in the bread-and-butter neighborhoods, well-kept, well-priced homes still sell in a sprightly fashion.

And then there's this, from the Republic news story cited above:

But housing analysts don't expect Valley home prices to continue to fall and are calling for double-digit appreciation gains next year.

No one can promise future appreciation, but our fundamentals are very sound. It still snows in the Great Lakes, houses are still extremely expensive in California, and, Chicken Little's lamentations to the contrary, interest rates are still very low.

This article neatly encapsulates the state of the market right now: Buyer's have some leverage for a change:

Metropolitan Phoenix's home-selling frenzy is beginning to calm and beleaguered buyers suddenly have more power in the fight for leverage in house deals.

We're writing deals with seller-paid closing costs for the first time in 15 months. Builders are offering huge incentives to new home buyers. Open houses abound, and listing agents are are once again routinely calling buyers' agents for feedback on showings.

We're not back to normal yet. There are about 21,500 active listings in the MLS, where a balanced market is about 25,000. And investors are still not welcome at new home subdivisions--as they will be as soon as the builders decide that the float on long-term deposits is worth more than the appreciation value of their inventory.

Chicken Little can rage on, but it's a great time to buy a house. There are plenty of sweet homes to choose from and sellers are ready to negotiate.

Give us a minute, get a free gift...

We're in the midst of putting our Christmas card list together, a daunting task. We send out hundreds of cards, but not nearly as many as we could. Many of the great people we work with, we know only by email, phone or fax. We'd love to send a Christmas card to you, but we may not have your current mailing address. But while our cards are always clever, a Christmas card is hardly incentive enough to get you to fill out an internet form. So we decided to give you a free gift, too:

It won't really look like that. It will be a tasteful white with BloodhoundRealty.com imprinted in black ink. But Greg has had one of these great tools for three years, and he won't let anyone even touch it. It's a staple remover, of course, but it's also a letter opener. The spark of genius in this little device is the built-in pliers for getting staples all the way out of the paper. We normally don't care much for promotional items, but this is too useful to pass up.

So: Get yours today! Fill out this form with your current mailing address, and we'll mail you this great tool in about eight weeks.

Etched in stone...

As a real estate brokerage, we're obliged by law to post a conspicuous sign near our door announcing the fact that you are about to enter a real estate brokerage. This is a matter of consumer protection. Otherwise, you might accidently wander into our offices and walk out homeless, all unawares.

All right, so we gotta have a sign, even if people seeing all the computers and maps might be able to figure out on their own that they're in a real estate brokerage. But: We hate the way everything is done, and we insist on doing things our own way. So: here's our brand new brokerage sign:

Our logo, our typography, cut into a frisket by laser pantography from an Adobe Illustrator file. The frisket was used to sand-blast the image into the stone, then used a second time to guide the hand-painting of the color.

Yes, you know you're entering a real estate brokerage. But you also know you're entering a real estate brokerage that doesn't do anything half-way...

The news is the news...

The tab in the brown toolbar that used to be called "Newsletter" is now named "News/Views". In addition to links to past editions of our newsletter, that page will take you to Greg's Arizona Republic columns and to our new, resurgent real estate weblog. In the future, we'll add a link to a webpage of our favorite houses in the Valley.

Thanksgiving in Vegas...

We normally go away to Las Vegas at Independence Day, which is also our wedding anniversary. We missed our window this year, so we're going to sneak away for a couple of days just after Thanksgiving. It's a great getaway for us. We really like it, plus which it's only an hour by air from Phoenix, should we need to run home for a real estate emergency (it could happen). Greg will stay on for two more days to finish the last class he needs to qualify for the CRS designation. This is just in the nature of a head's up. We'll have our computers and all our active files with us. If you need something, do not hesitate to call.

Here's to a well-roasted bird!

And: Happy Thanksgiving! It's been a great year in real estate, and every homeowner has a lot to be thankful for. Even though the menu is set by tradition, there's another bird we'd be happy to see you roast this holiday: Chicken Little.

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