021625- Home Solutions Podcast

Episode Transcript

Speaker 1 (00:01):
Hi, good morning, and welcome to the Home Solutions Show.
This is your host Andy Keel with the Win three
team powered by Epic Realty, and I'm joined today with
Jerry Sunt with Cross Country Mortgage and our very special
return guest, Bob Zachmeyer. Had a lot of feedback that
we'd like to get some of Bob's updates and market reports,

(00:24):
so we have him back on the show to give
us an update and talk about some other fun things
that are happening in the real estate world. So how
are you guys doing this morning?

Speaker 2 (00:36):
Doing great, Andy things. It's good to be back. Camille
and I both got kind of sick over the weekend,
so we are staying at home but don't want to
infect anybody else. But we're doing fine and got our
one hundred and two fevers down to ninety eight point
six again, so we're good.

Speaker 3 (00:54):
You know, Bob, you got to stat that late night
partying my friend. Yeah.

Speaker 2 (00:58):
So there's a couple of things I wanted to share today. One,
I have the year end statistics and just basically comparing
all of twenty twenty four with previous years. And then
also the January real estate numbers came out this week,
so we can talk about, you know, how things fared
in January. But longtime listeners of the show will remember

(01:20):
that Jerry and I have been saying for many, many
years that the real estate market kicks off the spring
market kicks off on Super Bowl Sunday, So you know
that usually means early March. The closings jump in March,
and then April May. June is actually the highest month
of the year for closings. But just remember that June

(01:41):
closings equal May offers, and you know, so basically the
three best months to be selling your home are March, April,
May to get closings in April, May, and June. With
that in mind, let's go into these numbers the interest rates.

(02:01):
Every time in the past several years that interest rates
went higher than seven, the real estate markets slammed on
the brakes and it just became an affordability problem with many,
many people. And between the interest rates you know, doubling
in the last four years and the home price is
jumping up one hundred or one hundred and fifty thousand
during COVID, it just puts it where the average person

(02:25):
can't afford to buy a home anymore. So a lot
of people out there have a very low interest loan
less than three percent or at three or two, and
they don't want to let go of that loan. So
it's causing them to stay in their homes much longer
than they normally would. And at the same time, there's

(02:45):
a shortage of homes out there, which is growing. I mean,
the number of homes on the market has tripled in
the last two years. So we're going to get into
all this kind of stuff as we go here, but
the bottom line is the interest rates if they lower them. Jerry,
what do you think, what's your current projection projection for

(03:06):
this year? What interest rates might end this year at.

Speaker 3 (03:09):
So they we started the year with you know the
big houses like or the big you know databases that
the Association of Relators, Mortgage Bankers Association, you know, Chase
Wells Fargo, and the end of the year range is
that mortgage rates would end up in the high fives

(03:30):
to those sixes by the end of twenty twenty five,
and again in October of last year twenty twenty four,
rate it was effected rates would get to mid fives
by the summer of twenty twenty five, and then that's
been pushed back that and rates have been that have

(03:50):
been readjusted to basically right around six percent. Will we
get there? This past week is a great example. This
was a turbulent week. Rates went were at started the
week at six point eight seventy five, went up to
seven and a quarter with the inflation data, and then
came right back down to six point eight seven five.
Scott doesn't The Treasury Secretary has has been very pounding

(04:15):
his desk that his goal is to get the yield
on the ten year treasury down, which will really help
the housing market. Now I don't know how he can
do that, but that is what he has been saying.
It's like, look, we're not interested in what the Fed does.
You know, they don't have to lower rates. My goal
is to get What I want to see is I
want to see that yield on the tenure drop and
if it does, and if somehow he's able to achieve that,

(04:38):
that will give that will bring mortgage rate down and
give a big boost to the housing market.

Speaker 2 (04:44):
Hopefully that'll happen for those that are interested. In twenty
twenty two, we came into the year selling homes in
the United States at a rate of six point four
million homes per year, and for the last two years
that number has been closer to four million homes. So
that's a shortage of two point four million homes twelve

(05:04):
months in a year. That's basically two hundred thousand fewer
houses a year being sold. So you know, that's quite
a change a lot of people. You go on in
an appointment and you meet with them, and they still
don't remember the Oh, we're going to have bidding wars
and we can just ask whatever price we want. And
I will tell you that pretty much that ship has sailed.

(05:24):
Unless you own a home that's extremely unique and has
an asset or an amenity that people are dying to have.
I don't see that happening very often anymore. Andy, have
you seen any biding wars.

Speaker 1 (05:40):
I have not seen a bidding war in some time.

Speaker 2 (05:43):
No, I didn't think so. So the affordability has been
you know, in the news for the last several years actually,
and you know, with the rates going high and the
price is going high at the same time, across the board,
we're actually starting to see the median home price drop
and you know that does that mean that your home

(06:04):
value is dropping? Not necessarily. That's a neighborhood by neighborhood
analysis that needs to be done. But what it does
show is what people are buying. The lowest priced homes
are the ones that are selling, not necessarily the ones
with the three car garage or whatever it's but it's
all about affordability. So we ended the year twenty twenty

(06:26):
four with fourteen thousand and twelve real estate closings in Tucson.
Compare that to the previous year of thirteen thousand, nine
to fifty four, So better close.

Speaker 3 (06:38):
You're so close to twenty twenty three, because they were
very similar years, yep.

Speaker 2 (06:42):
But the previous year twenty twenty two sixteen thousand, eight
hundred and the year before that seventeen thousand and five
fifty And if you look at twenty twenty, twenty, nineteen,
twenty eighteen, fifteen thousand, sixteen thousand, I mean we haven't
been at fourteen thousand and twelve closing since twenty thirteen,

(07:03):
so basically eleven years. We haven't had this many or
this few of closings in a year in Tucson. When
we look at the month of December nine hundred and
sixty two, closings. Compare that to last year nine to eleven,
so again slightly ahead of last year the previous year
nine eighty two. But back in the heyday during COVID,

(07:24):
in twenty twenty we sold sixteen hundred and twenty nine
homes and in twenty twenty one fifteen hundred eight homes.
So think about that, nine sixty two compared to sixteen
hundred almost half well and.

Speaker 3 (07:38):
Bob, you know when you look at these numbers and
we say so, we're looking at the same. So the
number of homes we sold in twenty twenty three and
twenty twenty four were similar to what we sold in
twenty thirteen, twenty fourteen, you know, rough numbers, or twenty
twelve twenty thirteen, and that's been mortgage rates really started
their decline.

Speaker 1 (07:57):
You know.

Speaker 3 (07:57):
That was when we started seeing rates going in from
the fours and into the threes, and that steadily went down,
you know, through twenty twenty one, and then changed and
did it about base in twenty twenty two. So that's
when things really started to pick up. You know, when
we look at twenty twenty three, in twenty twenty four,

(08:18):
the number of units sold for the year in p
MC County is very similar to twenty twelve and twenty thirteen. Well,
when we go back to twenty fourteen, that's when mortgage
rates really started their decline. You know, they were they
you know, well, the decline started in twenty ten, twenty eleven,
but then they really started to come down in fourteen
and fifteen, and that's when you saw the uptick and

(08:38):
volume of homes all the way through twenty twenty one.

Speaker 2 (08:42):
And then we have the straight line. I mean we're
not really like two thousand and eight we had six
hundred and eighty two homes sold, and in two thousand
and nine we had seven hundred and seventy five. But
then by twenty eleven we were at nine oh seven
and ever since then we've sold more homes during the
month of December until now. So it's definitely a ten

(09:04):
year setback in where the market was. Part of that
is because of availability, but the majority of it is affordability.

Speaker 1 (09:13):
Yeah, and then last week we were looking at some
lighter market statistics and we noticed an interesting new trend
that in the month of January we had I believe
the number was somewhere a little over seventeen hundred new listings,
which was a new record, and usually the highest number

(09:34):
of new listings come on the market in May pretty
historically every year, and we actually broke the record in January,
so I thought that was quite interesting.

Speaker 2 (09:42):
Yeah, actually I want to talk about that because when
you look at how many new ones came out and
how many went off the market, I mean, seventeen hundred
new listings came out and eight hundred and sixty two
I think was the number of sales. So you know,
we're gaining inventory, which is actually people trying to sell
their home aren't going to like that because there's more

(10:03):
competition for them. But for the long term real estate
market in Tucson, this is really a good thing because
it's actually normalizing the market again.

Speaker 1 (10:14):
Yeah, and we were looking at just shy of five
months of inventory with that number, which I think is
pretty widely wide consensus, that's a neutral market.

Speaker 2 (10:28):
I've got that report up here as well, eight hundred
and seventy six total sales and number of new listenings
two hundred and seventeen new But when you look at
the seventeen hundred with single family.

Speaker 1 (10:46):
Homes, right, that was the single families.

Speaker 2 (10:48):
Yeah, and you know, total listenings counting condos, town homes
and manufactured twenty two seventeen. And you know, the biggest
thing that throws us out a perspective is, in previous years,
the data included up to Marana and overpass Vail and
down the Green Valley, and now we're going all the

(11:10):
way to Douglas, all the way north to Globe, and
all the way south to Nogalles. So to say that, oh, well, look,
we haven't had this feel home sales since you know,
two thousand and three. Actually two thousand and three we
sold one and twenty two homes in that smaller area,
and now we've expanded the area from five hundred square

(11:31):
miles to three thousand, three hundred.

Speaker 1 (11:33):
Square a little bit of a difference then we.

Speaker 2 (11:36):
Did back in two thousand and three. So it's definitely
a change market. So the bottom line is we'll talk
about this after the break, but you know, it is
a slow market. The houses that have the best amenities
at the best price are the ones being sold. We're
going to talk about timing. We've got a couple of

(11:58):
people waiting in the wings to get their house on
the market for that early spring market. And we'll talk
about all of that when we come back to Tucson
Home Solutions on K and ST.

Speaker 1 (12:08):
Thanks and we will be right back after this break. Hi,
and welcome back to the Home Solutions Show. This is
your host Andy Keel with Win three team powered by
Epic Realty, and I'm joined again with Bob Zachmeyer and
Jerry Suntz. The previous segment, we were talking about some
market data and we're going to go a lot deeper
into that in this segment as well. So Bob, if

(12:29):
you'd like to continue with some market updates, sure, not
a problem.

Speaker 2 (12:35):
So we ended the last segment, you know, stating basically,
there were more homes sold in two thousand and three
than we're sold in twenty and twenty four, which in
itself is a pretty big thing to gather them twenty
one years later. What's the population change? Right, But the
biggest change is the area that used to incorporate those

(12:56):
sales went from five hundred square miles to three thousand,
three hundred square miles. So we basically took time six
the size of the MLS that's now being reported, and
we still couldn't beat the sales in two thousand and three.

Speaker 3 (13:09):
So that I think Bob is very telling because that
does show you, wow, we've increased the size of the territory,
but our number of sales have dropped. That does that's
a staggering statistic of Wow, the market is slower than
what it used to be. And that's how big of
an effect mortgage rates has on on affordability and the

(13:31):
number of transactions closing.

Speaker 2 (13:34):
And also, you know the amount of a number of
homes out there that are less than two hundred thousand.
I mean, right now the number if we go to
the MLS report, there are two hundred and seventy eight
active listings under one hundred and ninety nine nine hundred dollars.
So now that said sixty two of those sold last month,

(13:55):
which you know is less than there's a four point
four to eight supply months supply of home four point
four eight. But it's deceiving because wow, even the cheap
houses aren't selling. The thing is is now that you've
drug in you know, Mammoth and Saint David and all
these small outlying areas, there are a lot of lower
inexpensive homes out there that are for sale, but they're

(14:18):
not really relative to somebody who works in Tucson and
doesn't want to drive two miles or two hours every
day to get to work. So you know, it's sort
of deceiving. And I wish they would have incorporated some
of the older statistics and given us the ability to
take this data and then it down to the areas
that they used to cover instead of just starting off
with a whole new sample size. And I understand the

(14:39):
MLS grew and basically if anybody is interested, I mean,
all this market data is available to the public on
the MLS site and you can look at the numbers
and the charts yourself, but it's just the Tucson Reilters
dot Org is where the site is. But the you know,
the map of the area that we cover out west

(15:00):
past Douglas around out east, I mean almost closer to
Silver City than we are to Tucson, put it that way,
And that's just a huge, huge area. But back to
the end of the year statistics we were talking about
before the break here. You know, the thing that is
predictable about Tucson is win home sale and every year

(15:21):
June or July. Sometimes every once in a while you
might get made, but almost every year, the highest month
of the year for sales is June, and every year
so far we haven't beat it yet. The lowest month
of the year for sales is January. And that's why
we recommend to people all the time that you know,
during Thanksgiving and Christmas, nobody's looking. They just decorated their

(15:43):
home for Christmas. They're out there, you know, buying Christmas presents,
getting ready for company, baking goodies, and doing all this
stuff except go look for another house. So it really
makes no sense to have your home listed during this
dead time, and it's actually best to just take it
off the market and relist it when the people come back.
So we are just now approaching that time of Hey,

(16:04):
the people are coming back. And the percentage of homes
over time that sell in January during the year is
runs normally, right around six percent of the sales for
the year happen in the month of January. Well, if
we look at that and say, well six percent times
twelve months would only be seventy two percent. That means
the majority of them are selling in the summer, and

(16:26):
we oftentimes get over eleven percent. Between ten and eleven
percent of all the home sales in the year happen
in the month of June, so again those offers are
made in May, so we are coming up on the
perfect time. I would actually even wait another week or
two and let that spring market kind of come to fruition,
so you're not just tracking days on market for no reason,

(16:48):
and let the market come back and the people come back,
and you know, it'd be great. And there's a lot
of optimism out there right now because of the election,
because of all the DOGE findings, and people, you know,
think they're going to get a tax refund check because
of all the waste that has been found so far.
I don't know if that'll happen. It would be great
if they had a big check to everybody. And I

(17:09):
haven't looked at the If you haven't done so, go
to the Usdebt clock dot org. There is now a
new category on there. It's right on the upper left,
and it's Doze Savings And as of yesterday it was
over ninety billion dollars that they have already saved and
the programs that they cut ninety billion dollars. And just

(17:31):
think about that. You know, there's three hundred and forty
million people in the United States so I mean, that's
crazy the amount of money that would just be, you know,
paid out to a bunch of people. But so hopefully
the economy could go down. There could be if we
didn't have all this waste, we wouldn't need as high taxes.
That would put money in people's pockets and really really

(17:51):
help the affordability of a home because you have more
money from your check.

Speaker 3 (17:56):
Absolutely, you know, it's a bob a quid question. What
is if someone wanted to list a home and they're like,
what's the right what's the right time or right month
to put it on the market. Would you recommend March
or April as being the right time to list your home.

Speaker 2 (18:14):
On the market. I would say mid March, like right
in the middle, like the fifteenth of March would be
the optimum. And that way, the market's already heating up
and there's more buyers coming out of the woodwork. You've
given the early inventory time to drop somewhat, and so
the number of homes available is going lower, the number
of buyers in the market is growing higher. And then
you catch that first half of March, all of April,

(18:36):
all of May, and heading into June. That would be
in a perfect world. That's what I would recommend is
somewhere around March fifteenth or Saint Patrick's Day on the seventeenth,
got it. So the number of homes sold in Tucson
during the month of December was we already talked about this,
but when you look at it as a graph, and

(18:56):
how many years were as low as this, and keeping
in mind that this is year end that we're looking at,
and January is always lower, And when's the last time
we had eight hundred and sixty two homes for sale
or eight hundred and seventy six I keep saying sixty two,
eight hundred and seventy six listed properties. So if we
look down here, we haven't seen that since twenty fifteen,

(19:19):
twenty fourteen. So it's definitely low, low sales right now.
And even the nicest homes just aren't selling. I mean
people can afford them.

Speaker 3 (19:30):
Yeah.

Speaker 1 (19:30):
I've got a couple of statistics up on my screen
that I think play into this that I thought was
kind of interesting. I was actually really surprised. This is
coming from from National Association of Realtor's data that last
year they said the typical age of a home seller
was sixty three years old, the highest ever recorded. One
of the other items I thought was pretty interesting is

(19:52):
that the media number of years a seller owned their
home was ten years, the same as last year. That
number was higher than reported from two thousand to two
thousand and eight, when the tenure of the home was
only six years. So I think that goes into our
data that people are just staying longer. And that makes
sense because if they have a nice low two three
four percent interest rate, they can't afford to many cases,

(20:15):
buy their own home back at today's interest rates. Right, yep. Yeah.

Speaker 2 (20:20):
Most of the people that over half of the people
in this country could not buy their own home at
today's prices in today's rate, so they bought it at
a lower price. They have a lower rate, and they
can't afford to sell, and that's holding down inventory, which
is creating a shortage. But people need you know, we've
gotten used to having a roof over our head, and
so people that have to buy are still going to buy.

(20:42):
This market I think would have melted a while ago
if it wasn't for the people that can't afford to leave,
I mean, and that's causing a shortage, and it's causing
prices to still go higher. The good news is they're
not falling like two thousand and eight. There no melt,
it's just a very slow and steady But I would

(21:03):
encourage you to go to Zillo and look at your home.
Not that Zillo knows your home's value, because they don't
know anything about your home, but they know the area
of sales and if you go look at the zestimate history.
So go to Zilo, type in your address, click on
the home value, scroll down to zestimate history, and look
at the last ten years of your home. I'll bet

(21:23):
you that most people listening to the show would find
out that their home has been going sideways for three
years and slightly downward, and they aren't seeing an increase
in the value of that house at all. And that's
one of the biggest reasons that investors own rental property
is for appreciation. And right now, not only is it
not appreciating, it could be depreciating. So this is a

(21:46):
conversation that needs to be had. You know this is
Andy and I both specialize in investors, and you know
this is where you want to look at your rental portfolio.
This is a really good time to sell. Carry the
loan and basically get paid every month for without all
the headaches and hassles of being a landlord, and then
free upsmore inventory before it grows by itself. So days

(22:09):
on market is currently at fifty two as of the
end of the year. Put that into perspective, and back
in twenty twenty two, the days on market got down
to thirteen days on market, so we're actually four times
exactly four times. At the end of the year, the
inventory had risen to or the average during this time

(22:33):
all the decembers combined for twenty years is four hundred
and fifty four. We are currently at the end of
the year at four thousand, eighty three homes on the market.
We had gotten down. They've updated these numbers. Now we
were under one thousand in Tucson, but when you add
all these outlying areas, they show the low and eleven hundred,
so we have nearly quadrupled the number of homes listed

(22:56):
for say, so, if you are a buyer, interest rates
are not friend. I mean it's not as low as
it was, so you missed that boat, but you got
four times more homes to choose from, and you can
negotiate for the first time in twelve years to buy
a home because we had this straight up market where
there was no inventory and you just had to pay
whatever the people wanted and more than likely get in

(23:17):
a bidding warrant. And that is definitely different than what
it once was.

Speaker 1 (23:22):
Yeah, we're definitely in a different market. It's it's certainly
shifting more towards a buyer's market. And what we're seeing
today too with offers coming in is a lot of
requests for help with buyers closing cost points and they're
coming in at a discount, typically in some cases a
very significant discount.

Speaker 3 (23:43):
And Andy, though you're still seeing opportunities. I mean when
you look at this and you know from from a
buying undermarket and being able to fix it up and
flip it, there's still are opportunities. I mean there are
always is opportunities, but it still seems like it's plentiful.

Speaker 1 (24:00):
Yeah, agreed, and we are with that coming up on
a break, so we'll be right back with the Home
Solutions Show on KNST HI And welcome back to the
Home Solutions Show. This is your host, Andy Keel with
the Win three team powered by Epic Realty. And if
you would like to reach me. My number is five
two zero five three nine nine five nine one. I'm

(24:23):
joined again by Jerry Sunt and Bob zach Meyer. Jerry,
would you like to share your number in information with
the audience of course.

Speaker 3 (24:30):
Five two oh three seven zero ninety five seven six.

Speaker 1 (24:34):
And you as well. Bob.

Speaker 2 (24:36):
Sure, my number five to zero four zero four three
seven four to four. That's my personal cell phone. And
we have been traveling quite a bit, my wife Camille
and I and we're back now for a while. We
did a bucket list trip in November and December when
the market was the slowest time of the year, and
we left right before Thanksgiving and actually spent almost two

(25:00):
months in South Florida, and we did a drive a day,
stay a week kind of a thing where you once
you get to Florida, it's a long drive, but then
we just stayed on the beach. Going around South Florida
is something I've always wanted to do, and we got
that taking care of. So now we're back for a
while and we're just having a great time.

Speaker 1 (25:20):
Right.

Speaker 2 (25:20):
So we were talking about the inventory, and you know
the thing that when you put this, we have four
thy eighty three, So that's not a big thing, but
when you think about it, there are two nine and
eighty more homes than there were in twenty twenty one,
So percentage wise, I mean, that's like almost a four
x multiplier. The supply and demand curve is getting further away.

(25:43):
There's less demand, less people buying, more supply available. So
that's the highest that that difference has been since twenty seventeen.
And you know, it's just I think we're not done yet,
but I do believe the market is stabilizing. I think
the COVID price bump that happened and drove everybody's home
one hundred or one hundred and fifty thousand dollars higher

(26:06):
is in some neighborhood's going to take a little longer.
But I really think it's been sliding downward. And meanwhile,
wages are increasing and time is marching on a lot
of properties were starting to see they're getting pretty close
to their real value what they should be. If you
look at that z estimate history and draw a straight
line across the median, and you'll find that prices are normalizing.

(26:31):
So this is a needed You know, what goes up
must come down. You can't have an instant overnight. You know,
one hundred thousand dollars. Why did those prices go up
so much because the interest rates went down. People, they
haven't sold a car in forty years based on the
interest rate. They sell it on the payment and everybody's
looking at the payment. So when rates went lower, you
could afford a more expensive home, and prices just went up.

(26:54):
And there was all this demand, and there was a
bunch of people that never would have been able to
buy a home. They were lucky enough to get in
and they have the courage to jump in during COVID
and buy. I mean they changed their life. I mean
that house went up one hundred thousand dollars in two years,
and they probably put down three or five percent down
on a two hundred thousand dollars home and made one

(27:15):
hundred thousand dollars. That's a pretty darn good return on investment.

Speaker 3 (27:18):
And Bob, you know when you say that, but when
you say the courage to buy during that time, that's
the same thing we said during the eight to nine timeline.
And look what happened there. You know, you had a
huge way of return on your investment.

Speaker 2 (27:31):
And Andy and I I mean we purchased how many
houses during during COVID Andy.

Speaker 1 (27:37):
I'm not sure you and I, but I did over
fifty in that COVID shore.

Speaker 2 (27:41):
I think had twenty. You know it, just you got
to have courage to act. Right now, it's a good
time to buy. You can negotiate. I don't know that
the interest rate is going to fix the housing market.
I think the underlying thing is people are just out
of money. I think the biggest thing that could happen
to this housing market is actually getting reduced taxes. If

(28:03):
your taxes went down, that is the biggest savings that
you'll ever make in your life, if you can find
a way to lower your taxes.

Speaker 1 (28:10):
Yeah. Well, I wanted to point out one more thing
on this data that you have here, Bob, we definitely
have an increase in the inventory, but since you have
this amazing chart that goes back twenty twenty years historically speaking,
just putting this into perspective, we've got that active inventory

(28:31):
that's a little bit over four thousand, but if we
look back to two thousand and six, two thousand and seven,
it actually spiked over ten thousand. At the high point
there right around early two thousand and.

Speaker 2 (28:43):
Eight, and actually go back to two thousand and four,
because the big you know, the real estate meltdown really
started growing in five six, and it peaked in seven
and then eight the bottom fell out. If you go
back to two thousand and four, our inventory back then
was four thousand than eight hundred homes, So we are
now actually approaching normal inventory level.

Speaker 1 (29:05):
Yeah, And that was really the point I wanted to make,
is we're right at a five month supply of inventory,
which is considered a neutral market. So you know, there's
some trends happening out there that show us slow down
and heading towards a buyer's market. But I also wanted
to reiterate that one month certainly doesn't make a trend
with a lot of new listings in January, and it's

(29:25):
certainly not like some kind of gloom and doom panic
type thing either. Historically speaking, we're not even close to
where we were in that whole era between six and
roughly twenty twelve. We finally, what about twenty thirteen, broke
below four thousand home listings for a brief spell, and
then we were back up to as high as six
thousand for a number of years, and then it wasn't

(29:48):
again until around January of seventeen, where we broke below
that four thousand number again and then we trended lower
it well into COVID.

Speaker 2 (29:56):
Yeah, we haven't been above four thousand since January of
twenty seventeen until now.

Speaker 1 (30:01):
Yeah, so it is a new trend. It's coming back.
But when we have that twenty year history, it changes
the perspective a bit.

Speaker 2 (30:08):
And then you know, when you look at the absorption
this I wish the radio could project this chart because
the market crash came after the MLS percentage of homes
being sold and reached nearly fifty percent of the market
being sold in a given month, and when a normal
market is like a twenty five percent of the market
being sold four month supply of homes, we were reaching

(30:31):
where half the MLS was being sold in a month.
And then the market corrected itself well. During COVID, we
actually reached absorption of one hundred and fifty five percent
two years in a row. Where and how do you
have more than one hundred percent of the market being absorbed.
More homes were being sold than we're being listed by

(30:51):
one and a half times, and it just crazy. So
this is the first time that we're actually you know,
back to what would be the normal in the summertime,
we normally get to around twenty six twenty seven percent
of the market being sold. In December of this year,
even as slow and lethargic as it was, twenty three
percent of the market's still sold. So we're still high.

(31:14):
But the range normally in the winter time used to
be less than ten percent of the houses were being
sold in the winter, ten to fifteen percent, and in
the summertime, you know, twenty to thirty percent of the
homes are being sold. So you know this, we haven't
seen this normalcy for almost ten years, and it's I

(31:35):
think everything is getting back to alignment. That's probably the
best news in all of this. So but again, when
you look at prices, three hundred and sixty three thousand
was the median home price at the end of the year.
If you look back, the home prices in twenty twenty
two were about the same. So here we are in
twenty twenty five. Three years have gone by. Your home

(31:56):
really hasn't appreciated much in value because of the price
being higher, the interest rates being higher, and we're making
up for that jump that happened during COVID, And again
this is a neighborhood by neighborhood adjustment that you know,
you can't just say, how's the market, It's like, well,
it depends. Are you a buyer, are you a seller?
You know, are you in a high demand with low

(32:16):
supply neighborhood or are you in a high supply low
demand neighborhood. And all kinds of variables go into there.
But really, right now, the most important thing is being affordable.
And if you look over time, all the way back
twenty years and apply a four percent appreciation rate, our
numbers are getting very very close to being where they

(32:36):
need to be. And I think another year and we'll
if you have just applied a four percent rate, it
will have eaten up all the COVID mess and all
of the crazy appreciation that happened due to those low
interest rates. So then pending sales, pending sales are running
at almost record lows. If we look at how many
are expected to close this coming month on the MLS

(33:00):
January numbers eight and twenty six homes are are pending
right now when we and that's total listed properties and
twenty one hundred homes came on the market, so we're
definitely gaining inventory now. I think there were a lot
of homes that were taking off the market during December

(33:23):
and early January and are going to be hitting the
market again, and we have several of those as well.
And you know, they just there was nobody out looking.
It was cold, the days were short, the interest rates
were high. It just wasn't a good time to be selling.
So we have several that are coming back on the
market to catch that spring market that you know surge

(33:45):
that we see every spring active by price, and we're
almost through with the numbers here, six hundred and sixty
four homes between two hundred and three hundred thousand available.
You look at how many of those sold, two hundred
and twenty, so you know that's about one third of
those homes between two and three hundred that's sold. When
you look at three to four hundred, twelve hundred and

(34:06):
eleven homes for sale, two hundred and seventy nine sold,
So what a difference. I mean, you're looking at two
twenty out of six sixty four versus two seventy nine
out of twelve hundred and eleven, so twice as many
for sale between three and four hundred almost the same
number of sales between the two. That's affordability. So the

(34:30):
absorption still very strong across the board. Most in the
twenties four to five hundred thousand is only nineteen percent
being sold. But like I said, even the cheap houses
in less than two hundred thousand, twenty seven percent. The
highest demand is between two and three hundred thirty three
percent sold during the second slowest month of the year,

(34:51):
that's December, and the million dollar homes have really suffered
and they were running in the twenty one percent range
right up until six months. What's agoing now seven point
nine percent over one point four million and nine point
one percent over one point two million. Anyway, that is

(35:11):
the end of the year market report. And Andy, do
you have anything to add to that?

Speaker 1 (35:19):
A couple thoughts on that, but we are coming up
on a break, so I just wanted to make one
quick announcement before the break that we have a client
event coming up on the twenty second of February Saturday
at the Hermitage No Kill Cat Shelter. That is a
family fun day. We're going to have a lot of
fun things there. It's going to benefit the Hermitage Cat Shelter,

(35:42):
which is not for profit and also had some specials
on adoptions for cats and kittens. So I hope you
can come by and visit us. That's from two to
four pm on February twenty second on Saturday. And with that,
we're coming up on a break and we will be
right back. Welcome back to the show. This is Andy
Heel with Win three team powered by Epic Realty, and

(36:06):
I can be reached at five to two zero five
three nine nine five nine one. I'm joined again by
Bob Zachmeyer and Jerry sent In the last segment, we're
continuing to talk about market data. We're just about finished
up with that and talk a little bit about an
exciting new program that Jerry wanted to make mention of,

(36:27):
and a little bit about this week and what's happening
with the interest rates. So, Bob, do you want to
continue with the market data? Sure? So.

Speaker 2 (36:37):
Also, Andy, you want to give out your phone number again,
and if anybody's listening and looking or know somebody looking
for a home, write this number down.

Speaker 1 (36:44):
Go ahead, Andy, It's five two zero five three nine
nine five nine to one.

Speaker 2 (36:49):
We have several properties coming up for sale. We have
a four bedroom home on the east side of Tucson,
and the owners may consider financing that. It's extremely clean
and a newer built house, built in two thousand and seven,
so you can check in with Andy about that, and
then if you're looking for a starter home midtown, a

(37:11):
totally renovated, beautiful home with brand new air conditioner. This
is not a flip. This is actually a property owned
by the daughter of one of my college classmates. And
I met them at an appointment several years ago, and
they carried their home, and they carried the financing on
it when it's sold. And then their daughter got married,

(37:33):
no longer needs her home because her new husband had
a larger home, so they're moving into his. She's selling
this cute little house, totally renovated, brand new air conditioning,
grand encounters, I mean everything, two bedroom, one bathroom home
with a bonus room off the kitchen and a laundry
room and anyway, two hundred and fifty three thousand dollars

(37:55):
and this one they're willing to carry the financing on
at a unbelievably nice interest rate five point nine to
nine percent fixed rate thirty with a fifteen percent down payment.
So again, if you have someone looking and they have
a sizeable down payment, which would be somewhere in the
neighborhood of thirty eight thousand dollars, this is a seller

(38:17):
who would personally carry that loan for thirty years, no balloon,
and principal and interest payment would be twelve hundred and
ninety dollars a month. So and then also if anybody
is interested, we have a nicely updated town home in
Green Valley. It's just had a five thousand dollars price reduction.
And again it's this kind of a slow market, so

(38:38):
it's a good time to be out there looking. But
Green Valley's about the heat up as the winter visitors
start making their decisions in February and March before they
go home. So andy, again your phone number of people
are interested in seeing those properties.

Speaker 1 (38:51):
And it's five two zero, five three nine nine five
nine one. And on that note, I have one quick
quick property to add to that as well. We have
a really nice salm with what I think is a
fantastic price at eighteen ten North Heather Bray Avenue and
eight five seven one five zip code for three hundred

(39:11):
and fifty thousand. It had been a rental for a while,
so it's I mean, it's clean, it's livable, it shows nice,
but it's does need just a little bit of cosmetic
updates and such. So, but we priced it appropriately for that.
So if anyone would like more information on that, feel
free to reach out to me as well. So with that,

(39:32):
let's get back to our market date. Abob all.

Speaker 2 (39:35):
Right, now we're in the January report. You missed the
first couple of segments. Eight hundred and seventy six total
sales in Tucson. The median sale price three hundred and
sixty five thousand. The average dollars per foot of a
home sold in Tucson is two hundred and thirty two
dollars a square foot. But the shocker the number of

(39:56):
new listings that came in the market during the month
of Janjanuary two thousand, two hundred and seventeen new homes
on the market. If you're a seller, that is your competition.
When we look at how many sold versus how many
came on, I mean we had a substantial gain. There
are now four three hundred and fifty five active listings

(40:19):
on the MLS at the end of January, and right
now there are six hundred and ninety two that are
pending to close next month. Obviously more will go under
contract and go pending, so we believe that February closings
should be higher than January, but nowhere near the sixteen
and seventeen hundred that we had sold in the two

(40:40):
years during COVID. And when you break that down by
single family homes, there's three thousand, five hundred and sixty
seven single family homes, two hundred and eighty three town homes,
two hundred twenty six condos, two hundred and seventeen manufactured,
and sixty two mobile homes which are older than July

(41:00):
fifteenth of nineteen seventy six. Total of four thousand train
earned fifty five homes for sale, and really that's pretty
much sums it up. There's a lot more homes for
sale than there are being sold, and we're running right
around twenty to twenty five percent absorption right across most
price points. And Jerry has a great program, So let's

(41:22):
given over to Jerry's son. He's your go to real
estate lender. Jerry's been on my lender, and I'm actually
getting a loan right now from Jerry and how many years,
Jerry thirteen, fourteen years?

Speaker 3 (41:36):
Well that you and I've been together, Yes, fourteen years,
but I've been learning for twenty one years.

Speaker 2 (41:41):
Wow, and always in like the top twenty year, top
fifty in the whole United States, and especially with the
current market for loans, it's a difficult market to navigate.
Jerry is the guy to go to, and I can't
recommend him high enough. So I'm running out of words
to share how happy I am with you, Jary.

Speaker 3 (42:03):
Well, thank you, Bob. No, there's a program that it
came out about a month and a half ago, and
I didn't dive deep into it only because I wanted
to make sure the bugs were worked out, and sure
enough they are. It is called Hoper like Hope with
an R added to it, and it is for first
time home buyers. And if someone wants to put solar

(42:25):
on a home, listen to this program. Number One, you
get thirteen thousand dollars in down payment assistance. Number two,
you can finance solar on the house up to twenty
percent of the sales price of the home, and that
solar is financed into the mortgage. So, for example, if

(42:46):
you had a three hundred thousand dollars home, you could
get thirteen thousand dollars in down payment assistance, so it
pays for your down payment and most of your closing
costs for that matter. And then and let's say you
put solar on the house for thirty thousand dollars, so
the house would only have to praise for three hundred,
but you would then add the solar to it, so

(43:09):
you're you're financing. You'd be paying on a monthly basis
on a three hundred and thirty thousand dollars loan. But
now you have a brand new solar and you actually
if the roof needs work, you can get the roof
replaced as well. I mean, what an amazing opportunity to
have solar where you're going into a house and then
not having energy bills.

Speaker 1 (43:30):
Wow.

Speaker 2 (43:31):
So, Jerry, what is the like for one thousand dollars
borrowed right now? At seven percent? What's the average payment?
Like six dollars seven dollars?

Speaker 3 (43:40):
That's six six six six fifty Yes.

Speaker 2 (43:43):
Okay, So if you think about this, how much is
an electric bill?

Speaker 3 (43:47):
I would say the average is about three hundred the
way things have gone out.

Speaker 2 (43:51):
Yeah, so when you think about it, if you can
get rid of your electric bill with owned a solar
and this is not least solar, this is owned, you
actually added value to your home. The payment goes up
and I just I'm a huge proponent of solar energy.
I put it on my house in twenty sixteen, and
this is my break even year. I mean I got

(44:12):
paid back and what I've saved in electric bills, I
am now ahead of the game. I have our bill
never exceeds twenty one dollars in someond since it's all fees.
Haven't had a bill in since twenty sixteen. And this
is an amazing thing for people that are looking to buy.
I mean, if you can get rid of your electric field,
that gives you the ability to buy a much more
expensive home.

Speaker 3 (44:32):
Well, and the other piece of to that is that
you also have the tax credit. Remember you know Arizona
gives a tax credit for adding solar. I think it's
ten thousand dollars. You can average that over five years. Yeah, year,
you get a two thousand dollars tax credit as well.
It is an amazing program. It's called hoper and it
is for first time home buyers. One of the stipulations

(44:54):
the house that you're looking to buy cannot currently have solar,
so it has to be a new and of solar.
But call me and we can discuss in more details.
But I think this will be you know, we've been
talking about Lighthouse, which is also coming back in March.
By the way, Lighthouse another amazing downpayment assistance program. It
is where you get four percent in downpayment assistance and

(45:17):
the interest rate is about you know, half a percent
plow market. And we'll find out the exact dates on
what the interest rate will be for this next round
of Lighthouse and the date it will be released on
the nineteenth of February, so we'll be knowing that next week.
But that's also coming out. But when I compare the
Hopper program or Hoper program as compared to you know, Lighthouse,

(45:41):
I got to tell you that Hoper program just kind
of blows it out of the water.

Speaker 1 (45:45):
Wow. So there you go.

Speaker 3 (45:48):
So that's the exciting news with perspect to So if
your first time home buyer and your thing of buying,
there is help that is available and you really should
look at taking advantage of these opportunities. As far as
interest rates go, it's I kind of feel like it's
the weather and Arizona in the summer, or Florida. It's
you know, it's they're right around seven percent. They did

(46:09):
jump up this week north of seven percent with the
inflation data that came a hotter than expected, but then
they came right back down, and so a conventional thirty
year fix is right below seven percent, So it's about
six point eight seventy five six point nine. Will rates drop,
They will sometime this year, they are expected to, but
they're probably not going much below six percent, not unless

(46:32):
something really dramatically changes with the economy.

Speaker 2 (46:35):
And Jerry, what if somebody got alone right now and
then they did drop, you would refinance them at a
lower rate.

Speaker 3 (46:40):
Right Absolutely, We actually pay their closing costs when they
refinance as long as the loan nuts over two hundred
and fifty thousand.

Speaker 1 (46:48):
That's awesome.

Speaker 3 (46:50):
Well, it's I think it's an exciting time. I think
twenty twenty five will probably be a very close mirror
image to twenty twenty four. But that does mean the
spring buying season is heating up and we're seeing it
on the applications or leads. The number of leads over
the last few weeks has been increasing, which tells you
people are preparing to go out and buy March April May.

(47:13):
So I think that the market is going to spring
to life here, no pun intended very.

Speaker 1 (47:18):
Quickly, Assett. I would agree with that too, Jerry. We're
seeing some more call activity and activity picking up as well,
so it seems like things are use your quotes starting
to spring to life. So with that, we are coming
up on the end of the show again. This is
Andy Keel with the Home Solutions Show on canis T

(47:38):
and we'll talk to you next week.