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How Much Do Home Alarm Systems Affect Resale?

Home alarm systems can be particularly hard to calculate into resale value or return on investment (ROI) because their job is to prevent loss rather than achieve gains. You purchase a home alarm system with the hope that you never need to use it.

The reality is that a burglary is reported to police every 14.5 seconds. But robbery isn’t the only thing that alarms can save you from. Smart alarms can detect smoke and hazards.

More than ever, homeowners want to feel safe in their homes. A built-in alarm system may be just what it takes to get your house off the market.

1. Alarm Systems Aren’t as Expensive as They Used to Be

According to HomeAdvisor’s survey, most homeowners invest between $330-$1,040 when purchasing and installing home alarm systems. However, with the advent of smart, connected technology, home security is more affordable than ever.

Products like the Nest Cam Outdoor monitor your home in 1080p high definition video that you can access from your smartphone 24/7. This monitor also has a two-way audio feature, meaning you can use your voice to scare off intruders or give live instructions to a delivery service. Smart products allow you to monitor your home yourself, which cuts down the cost of hiring a security company to do the monitoring for you.

Smart products send security alerts right to your phone, allowing you to act fast and take control. Monthly security subscriptions on smart products are usually a fraction of the cost of subscribing to a traditional security service.

2. Add Resale Value

Owning a safe and secure home is appealing to every home buyer, from frequent travelers to families. That means pre-installed cameras, smoke detectors, and smart locks can be huge selling points. The more convenient and easy-to-use the security, the better.

One of the most desired security features for homeowners is motion sensor lighting over the driveway. Not only does it scare away late-night intruders, it also helps homeowners navigate in the dark. Buyers want added safety and convenience in their everyday lives, and the right security system can provide both.

3. Home Security Lowers Neighborhood Crime

In 2016, Rutgers University released a study that found that neighborhood crime rates dropped significantly when alarm systems were installed in multiple neighborhood homes.

Burglars are less likely to break into homes that are protected with home security, and that fact carries over when applied to entire neighborhoods. Safe neighborhoods are highly desirable to homeowners and can help your home sell faster and at a higher price.

4. Alarm Systems Can Reduce Your Homeowners Insurance

If you financed your home with a mortgage, you are most likely required to have home insurance. While the price of home insurance varies, most companies offer discounts to homes with security systems.

With a home monitoring system installed, you can save up to 20% on home insurance. Those savings can amount to hundreds of dollars per year or the cost of the security system all together.

5. They Save Money in the Long Run

Burglaries can cost you, not only in the possessions stolen from your home, but also in the damage that many homes incur during a burglary.

Most burglars enter homes through the front or back door or first-floor windows, usually breaking them in the process. The cost of fixing a broken window or kicked-in door can be even more expensive than the valuables taken.

It was found that when burglars enter homes with security systems, they are much more likely to leave quickly, taking fewer items with them.

While security systems aren’t foolproof, they do offer the benefit of safety and security. Whether you’re installing a system for yourself or for future homeowners, the peace of mind it offers is the ultimate ROI.

Position Realty
Office: 480-213-5251

Hey Millennials, Lennar Will Help Pay Your Student Loans

A new loan from national homebuilder Lennar is raising hopes for millennials, and raising eyebrows from some in the real estate industry. The loan seeks to make homebuying a reality for millennials who might otherwise think they have to wait until their student loans are paid off.

The idea is this: Homebuyers use Eagle Home Mortgage’s Student Loan Debt Mortgage Program; Eagle Home Mortgage is a subsidiary of Lennar. Through this program, borrowers “can direct up to 3% of the purchase price to pay their student loans when they buy a new home from Lennar,” said the builder in a news release. That can add up to $13,000 in student loans, depending on the sales price of the home, and payments “can go toward loans from universities, community colleges, trade schools and other ‘certificate-granting programs’, but can’t be used for loans that parents have taken out to pay for their child’s education.

Sounds like a great deal for millennials. But is it a fix-all?

“Financial planning and student loan experts caution that the plan unveiled last week by Lennar just swaps student debt for mortgage debt,” said CNBC. “Jason Delisle, a student loan expert at the think tank American Enterprise Institute, said Lennar’s student loan payments struck him as a price cut marketed toward debt-laden millennialism,” they added. “Why not just give them a discount on the house?” Delisle asked.

There’s also a question about where the money is coming from and what the long-term implications could be. “There’s no free lunch,” Allan Roth of Wealth Logic, a financial planning firm in Colorado Springs, told them. “If a for-profit company wanted to make a charitable contribution, then they would make a charitable contribution. This money has to come from somewhere.”

CNBC floated the idea that the price of the home could be increased to cover the cost, however, Lennar clearly stated in its news release that, “Lennar contributes the 3%, which does not increase the price of the home or add to the mortgage loan balance.”

Of course, for millennials who have been looking for their way in to the market, the response may just be, “Who cares?!” According to the New York Federal Reserve, the average outstanding student loan balance is $26,700. “That’s one of the reasons that millennials are buying homes in lower numbers than young people have in previous decades,” said the South Florida Business Journal.

And when you also consider that the down payments under this program can be as low as 3 percent, and “buyers may also be eligible” for additional programs, like those that can help with closing costs, it sure seems like a millennial win.

“Americans are more burdened than ever by student loans, with $1.3 trillion in outstanding student loans spread out among 42 million borrowers,” said Jimmy Timmons, President of Eagle Home Mortgage. “Particularly with millennial buyers, people who want to buy a home of their own are not feeling as though they can move forward. Our program is designed to relieve some of that burden and remove that barrier to owning a home.”

Buyers have to meet credit and income requirements to qualify for the Student Loan Debt Mortgage Program, and the maximum loan amount is $424,100, which covers dozens and dozens of attached and single-family options across the country from Lennar.

Most of them, not surprisingly, are in the suburbs. But is that an issue for millennials, who conventional wisdom (and many industry experts) have said is off millennials’ radar? Not so fast.

“Americans aged about 18 to 34 have become the largest group of homebuyers, and almost half live in the suburbs,” said Bloomberg. “The shift to suburbia may surprise those who’ve chided millennials for being more interested in pricey avocado toast than in saving for a home. Much of the generation delayed marriage, childbearing and home ownership after graduating with heaping student-loan debt and entering a weak job market. As more millennials overcome this, many want the life of their baby-boomer parents – the kids, the house in the ‘burbs and the beefy SUV.”

In fact, if you look closely at millennial homeownership numbers, you’ll see that, while “there’s been an increase in the number of young adults in urban areas” over the last 10 years, it’s “largely due to a 32% increase in births between 1978 and 1990, according to Dowell Myers, professor of demography at the University of Southern California,” said TIME. “He says that upswing has led people to believe that there’s been a real change in millennials’ preferences, when really there were just a lot more young people born 25 years ago.

A Harvard study by its Joint Center for Housing Studies – “which used data from the census and the Department of Housing and Urban Development as well as its own analysis — found most stereotypes associated with millennial home buyers were not true,” said the Los Angeles Times. And key to those findings were millennials’ geographical preferences. “The evidence suggests…that homeownership decisions by younger households have much more to do with affordability than location and lifestyle preferences,” study authors said.

Position Realty
Office: 480-213-5251

Why Buyers Won’t Buy Your Home

There’s no list of reasons — no top ten or even top three reasons — why buyers won’t buy a specific listed property like your home.

There’s just one reason.

When buyers won’t buy listed real estate, or even put in an offer close to asking price, there’s just one reason why — it’s the list price!

List price must communicate value and opportunity to buyers for whom the listed real estate represents what they want and need. Individual buyers have individual home-buying wants, needs, and goals which range from solid financial investment to discovering their dream home, or both.

When the list price on a specific property communicates value and opportunity to buyers who are ideally suited to recognize high value and great opportunity, these buyers want to act. They are compelled to put in an offer before someone else snaps up their dream home/ideal investment.
When list price does not accurately communicate value and opportunity — usually because it is unrealistically high for the current real estate market, location, ownership benefits, and property condition — buyers not only won’t make an offer, they may not even want to view the property.
The list which is vital for sellers to consider is the list of reasons why listing price can be a barrier to the successful sale of their real estate. Here’s four of many reasons why list price can turn buyers off and leave the unsold real estate sitting on the market:

#1. Listing “Home” Not Real Estate: Sellers may start out intent on selling their home. However, they will find the selling process challenging until they realize exactly what they are actually selling. Not their home, but real estate — bricks and mortar, land, and related rights — that must attract buyers searching for their new home. Removing the seller’s personal veneer from a house or condominium unit to reveal the true value of the real estate is just as important as sellers removing their personal attachment — pride of ownership — from their thinking and decision making. List price should reflect value from buyers’ perspectives — that’s the real estate market value and the value evident after comparing competing listings — and seller’s investment value based on the current market.

#2. Value vs Cost: Seller improvements do not hold equivalent dollar-value for buyers. For example, a seller who recently paid thousands to modernize windows and replace the roof, may expect list price to reflect this out-of-pocket cost. Some buyers may attribute move-in-ready value to these property improvements, but the actual dollars attached to these seller expenditures may fall short of seller costs.

#3. The Market Now: Economics can change quickly. The current real estate market is the one buyers are shopping in. For instance, the higher priced market last year, last month, or even last week means nothing to buyers once economic conditions change. Sellers who hang on to a now-historic selling price that they missed out on and who refuse to adjust to market-dictated price down-grades, can create a listing barrier by sticking with the out-dated higher list price. The listing message may be interpreted as “stubborn seller here,” which does not attract buyers. Letting go of missed opportunity can be a challenge for sellers, but this does not help the property “shout” opportunity to buyers.

#4. Selling: Only Half The Winning Real Estate Strategy Sellers who expect their real estate win to come exclusively from the sale of their real estate, miss the point of real estate as an investment. The full return from real estate ownership — on top of the benefits gained by living in the property or renting it out — comes from selling the property and putting the earned profit to work either to purchase more real estate or to invest the funds in other ways. Sellers who only spend time and effort on selling, may miss out on even greater returns from putting their sales profits to work. Selling or cashing-in real estate is only half the winning strategy! More on this topic in my next column.

Real estate professionals are trained to understand the economic and financial complexities of establishing market value and list price for the real estate held by their clients. Ideally, list price is established by the seller based on information, selling strategy, and market data provided by the listing professional and on seller goals. Select the right professional for the correct expertise to get the list price right.

List price is based on market value which is more accurately represented by a range than an absolute figure. Depending on the marketing strategy that matches seller needs and wants — including seller time constraints and moving criteria — the list price may be set on the optimistic side or with a practical slant.

What value and opportunity will your list price communicate to buyers?

Position Realty
Office: 480-213-5251

Tips For Getting Your Home Sold In The Winter

So you’ve decided to list your home this winter. Perhaps you’ve had a job change, need to relocate out of the area, or have financial or family reasons for moving. No matter what is driving the move, you may be concerned about selling at this time of year. But just because you missed the boat on the spring selling season doesn’t mean you can’t get your home sold quickly, and for a profit. A few tips can help get it moving.

Take photos early… or late

If you can take photos before the trees become barren and the grass goes dormant, do so! The last thing you want is for your home to look blah and depressing in photos. If you can capture a snowy day (with perfectly scraped walkways, of course), that works, too. It never hurts to have your home looking like a winter wonderland.

Go easy on the holiday décor

“Deck the halls, but don’t go overboard,” said HGTV. “Homes often look their best during the holidays, but sellers should be careful not to overdo it on the decor. Adornments that are too large or too many can crowd your home and distract buyers. Also, avoid offending buyers by opting for general fall and winter decorations rather than items with religious themes.”

Always mind your curb appeal

Just because it’s winter doesn’t mean you can let things slide out front. Potential buyers won’t give you a pass on chipping paint, a fence that needs repair, or a front door that’s seen better days just because it’s frigid outside.

Safety matters

Shoveling the walk from the street to your home is necessary to make it reachable, make it inviting, and also make it safe. The last thing you want is a slip and fall that could result in an injury, and a lawsuit. “Continually shovel a path through the snow, especially if snowflakes are still falling,” said the balance. “Footprints on freshly fallen snow will turn to ice if the temperature is low enough, so scrape the walk. Sprinkle a layer of sand over the sidewalk and steps to ensure your buyers’ stable footing. Remember to open a path from the street to the sidewalk so visitors aren’t forced to crawl over snowdrifts.”

Get a good indoor mat

Perhaps you never use a mat for indoors or yours is grubby or tattered from 10 straight years of winter wear. This one super easy move may not be noticed by visitors – but it sure will if it’s missing or not in good shape. Little things like a $10 mat can give buyers the impression that your whole house is well cared for, or just the opposite.

Clear the front door clutter

If you live in a climate where there is likely to be snow or rain, there are a few more steps you’ll probably have to take in order to keep your house looking great inside. How does your coat closet look? If it’s stuffed with jackets, scarves, boots, and gloves, relocating some to make room for potential buyers to put their stuff away while touring your home is a good idea – plus, a tidy coat closet gives the impression that there is plenty of storage space in the home. It goes without saying that winter wear and shoes that tend to stack up in the entry should be banished while your house is on the market.

Make sure everything is functional

Imagine you live in a climate that stays relatively temperate year-round, and then you have a cold spell. You turn on the heater for the first time the night before your first showing, and…nothing. Same for the fireplace in the living room. Your freezing cold house is probably not going to make a great impression on buyers. As soon as you decide you’re going to sell your home, go through it room by room, checking all major appliances and home functions and looking for little things that may escape notice on an everyday basis – cracked light switches, chipped baseboards, light bulbs that need to be replaced – so your home is perfect for showings.

Light it up

Shorter days with earlier sunsets limit the amount of natural light in your home. Turning on all the lights before showings is more important than ever. Think about the exterior when it comes to lights, too. If you only have a porch light, you might want to consider adding some landscaping lighting, which will help accentuate your outdoor space.

Listen to your REALTOR® when it comes to price

Will you be able to command top dollar for your home and get the same price you would have had you listed in spring or summer? That depends on so many things, including your neighborhood, the available inventory, the condition of the home, and, of course, your listing price. A trusted real estate agent will take all mitigating factors into consideration and use comparables in your area to develop a pricing strategy.

When it comes to offers, remember this tidbit from Realtor.com: “Just because your home’s on the market during the slow, chilly months doesn’t mean you have to accept a lowball offer. If you make your home attractive in all the right ways, qualified buyers will come.”

Position Realty
Office: 480-213-5251

Phoenix Real Estate Market Report ~ September 2017

The current real time market profile shows there were approximately 9,646 new listings (down 203 listings from last month) on the market in September 2017 and 7,451 sold transactions (down 812 listings from last month). This is the second consecutive month the number of new listings exceeded the number of sold transactions. Overall, the inventory of homes on the market is still very low where in September 2017 there were 19,769 homes (up 527 listing from last month) on the market which is down -23.8% as compared to the number of home on the marker in September 2014. In September 2015 there were 21,778 homes, in September 2014 there were 25,960 homes and in September 2013 there were 22,048 homes for sale on the market. Due to the declining in average days on market since February 2017 this shows buyer’s demand is strong where inventories may continue to be low and drive up prices.

The average sold price decreased from $299,435 in August to $294,378 in September which is a -1.7% decrease. Historically, since 2014 the average sold price has declined from July to August and doesn’t start to increase until late September and early October. Overall, the average sales price since October 2016 (12 months ago) still has an appreciation rate approximately +3.3% (down from last month) or from $284,888 in October 2016 to $294,378 in September 2017. In 2014 real estate prices appreciated 4.5%, in 2015 5.5% and in 2016 4.2% where according to the National Association of Realtor the average annual appreciation rate is 5.4%. Therefore, Phoenix is still on track to reach is historical appreciation rate as long as price increase from October to December. Since October 2016 (12 months ago), the average days on market has decreased approximately -10.8% (down from last month) and the number of sold transactions has increased approximately +4.9% (down from last month).

The volume of foreclosure purchases since October 2016 (12 months ago) has decreased approximately -33.8% and the volume of short sales decreased of approximately -55.6%. The current percentage of foreclosure sales and short sales sold is only 1% of the market which indicates a healthy market. Unfortunately, there are still some homeowners who bought between 2005 and 2007 that are still up-side-down as shown in the yearly average sold price chart above.

Since October 2016 (12 months ago), the number of homes for sale on the market have decreased approximately -14.0% or 22,986 homes for sale on the market to a gradual decrease of 19,769 homes (Down 3,217 homes). The total number of listings is low as compared to 25,960 listings in September 2014. This decrease in the number of homes for sale indicates we are currently in a seller’s market (low supply and increased demand).

Real estate prices will continue to increase and interest rates are planned to increase in 2017 so if you are thinking about buyer a home this year will be the time to buy before you get priced out of the market. Give us a call to discuss your best buying or selling strategy, TODAY!!

Position Realty
Office: 480-213-5251

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