Time to Buy?

I have noticed some discussions lately about market timing and our housing market. Some have said that it would be smart to wait for the "bottom" before committing to a purchase. Even if you could predict when the bottom will occur (you can't) there is more to that equation.

For anyone contemplating a home purchase, it is also important for them to factor in the cost of financing in that decision and their ability to pay at that rate.

If I can afford the home I want and have a time horizon longer than a year or two, what difference does it make if I buy at the bottom or a year (or two) early?

Just as home prices can go down, mortgage rates can go up. Today's rates are at historic lows. Buying a home now at a fixed rate that is affordable sounds smart to me.

I bought my first home in 1974, in the midst of a recession during the oil embargo. I was too dumb to know that it was a bad time to buy a house (I was only 21) I was not a speculator, just a kid who wanted a place of his own to live. My time horizon was very long. Never heard of the concept of "flipping". I just liked the idea of no landlord. Although sometimes it was a struggle, I was able to make the payments. Needless to say, I did OK with that house.

I am glad that there was no 24/7 media to talk me out of that purchase in 1974. Although the bottom may not be here yet. there are some good deals out there right now. If you are planning on hanging around the Old Pueblo for a while, buying that home you want and can afford might be a smart thing to do.

Shipping Container Homes!

This is a very interesting concept from a recycling as well as an archetectural standpoint...

Save Rillito Race Track

On Saturday I detoured to the track during a relaxed stroll with a friend down the Rillito River Walk. When we arrived the official at the ticket gate told me that over 10,000 people were there (she had a counter-clicker) and there were still more streaming in. The parking lot was full of cars.

We sat in the grandstand which appeared to be solid (it's steel) and in no danger of collapsing. The overall cosmetic condition was poor, the windows had cobwebs, the bench seats (with backs!) needed painting, as did the rest of the place, but despite the County's neglect, everyone was having a great time, whether in the grandstand or close up, on the rail watching the beautiful horses run by at top speed.

The Catalina mountains are perfectly framed in the big glass window array of the grandstand. The large grassy infield sports 4 soccer areas with goals, so the site serves more than one purpose.

I signed a petition to save this historic landmark. The public should get on board too to preserve this 1940's era part of our heritage before it is leveled and sold to the highest bidder. As one petition signer said to me, "This place belongs to the people, not the Board of Supervisors". I agree.

The Phone is Ringing

Recently I wrote about "The January Effect" where I described the historic trend in our Real Estate market place where sales activity increased after the new year started. This has been vividly demonstrated to me this week with a ringing phone from buyers calling on our listings and happily, an offer that was negotiated to a contract on one of them.

It is good to set aside all of the doom and gloom for a while and just do our work. In my business, there are people out there who recognise the opportunities in our market place (lowered prices and historic low interest rates) and are acting on it. Things will be better in the months to come.

Tucson is a great place to live. Lots of people know this. I received an e-mail from a friend in Indiana this morning and he said that it was minus 35F there today! I am taking our sunshine dividend to the bank, knowing that Tucson will continue to grow, probably at a faster pace than some other parts of the country, and our real estate market will recover. And the weather is better here. That's one of the blessings that should be on our counting list.

Check Your Auto License Plate Frame!

A new law will come into effect on Jan 1 2009 which you should be aware of. Here are the details from the AZ DOT Motor Vehicle Division:

License Plate Holder Law - State law* requires that the state name at the top of Arizona license plates must be visible. Any license plate holder or cover that prevents the license plate from being clearly legible, is in violation of this new law.
* A.R.S. 28-2354(B.)

Fines in Pima County could be up to $133 per violation! Other municipalities may have different fines. In a casual survey around my neighborhood, a majority of the vehicles that I inspected have license plate frames that violate this law. It is a simple thing to remove the plate and frame and re-attach the license without the frame or use a new frame that does not obscure the information on the license plate.

In another "fine" matter, Before the U of A vs ASU football game a few weeks ago, I spied City of Tucson workers busily citing parking law violators in the Sam Hughes neighborhood. Did you know that you may not park within 5 feet of a driveway entrance or 10 feet from an alley entrance? If you didn't know this, you could be surprised with a $180 parking ticket. Beware!

The January Effect

Chart: Total Sales Units vs Month 2004-2008

When one looks at the Tucson MLS statistics, an interesting pattern is quite evident. In the past 4 years, closed sales numbers hit bottom in January, then begin to climb again in February and March, peaking within the next few months.

The peak occurred in June in 2004, 2005 and 2006, with sales numbers March, April and May not far behind. The peak in 2007 occurred in May, but the numbers for February March and April were also not far behind. The numbers for 2008, while down considerably from previous years, had a significant percentage jump in February and March, peaking in June with 1034 closed sales, slightly behind May which had 1,025 closed sales.

Since there is a lead time between when a buyer looks at and decides to make an offer on a home and the closing, (lets say 45 days for argument's sake) you might conclude that it would be wise to have your home on the market in January to catch those buyers and the others that follow in February, March and April. I would agree with that conclusion.

Interest rates are now at historic lows, there is a "First Time Buyer" Federal tax credit available through April 2009 (as much as $7500 for married buyers who file jointly and $3750 for those married or not who file individually) Inventory has been reduced considerably since last year. History points to an improved market in the early part of this year, compared with the previous months, although the actual numbers may still be below last years, YTD. Regardless, a window of opportunity is opening for those who want to sell their home now, and January is the time to begin.

Census Releases Growth Figures. AZ in 2nd Place!

This just in from the US Census , Arizona comes in second, behind Nevada in population growth (percentage wise) since 2000. adding almost 1.4 million souls in that time frame.

Arizona's actual growth in population (not percentages) since July 1 2007 was 147,000, fifth behind Texas, California, North Carolina, and Georgia. Here is a link.