June 2011 Market Update The U.S. housing market continues its gradual and uneven progress, despite the expiration of the home buyer tax credit. The remarkable rebound in housing activities from the initial drop following the end of the home buyer tax credit this past July adds to the belief that the risk of a double-dip downturn in housing may be disappearing. As the housing market continues to work through the excess supply overhang, a result from the glut of foreclosed properties which is keeping home prices below their long-term trend growth, economists anticipate mortgage rates at or above 6% by the end of 2012 and expect buying activity to continue its upward momentum. Supporting this view is the rising concern about inflationary pressures sparked by political unrest in the Middle East. While surging gas and food prices could prove transitory and pose no major threats, these price increases may weigh down consumer spending, which accounts for two thirds of the economy. While, the Federal Reserve is committed to making necessary policy changes to address such risks. Meanwhile, core price gains, excluding food and fuel, were modest in April, offering some relief to consumers. As the economy improves, stimulus efforts by the government and the Fed is expected to gradually wind down, which typically spurs rising interest rates to keep inflation in check. Meanwhile, buyers continue to benefit from historically favorable buying conditions and sellers are encouraged by increased market stability. Home Sales in millions The number of homes home sales in April were down 12.9% compared to the same time last year when the impact of the tax credit was at its peak. Sales were relatively stable compared to the previous month: less than a 1% decline. NAR Chief Economist Lawrence Yun states that “given great affordability conditions and job creation, home sales should be stronger” and cites unnecessarily tight credit for limiting sales. Gradual but uneven improvement is expected to continue. In fact, home sales have increased six of the past nine months. Home Price in thousands Home prices rebounded 2.4% in April with median home prices rising to $163,700. This is 5% below the year-ago level and continues to keep the median price close to 2002 levels. Three out of eight homes sold during April, or 37% of sales, were distressed properties, which typically sell at a 10%–20% discount. This is down 3% from March. Investors represented 20% of sales, and all-cash buyers were 31% of sales in April, down from a record high of 35% in March. Prices and mortgage rates remain favorable for buyers for the spring selling season. Inventory- Month's Supply in months The supply of homes measured in months on the market, if sales continue at their current pace, inched up during April compared to March. Inventory levels remained 26% below the peak of 12.5 months in July and only 11% above April of 2010 when the tax credit was in full swing. Source: National Association of Realtors Interest Rates Rates have reached a new record low after steadily declining throughout May, primarily due to uncertainty in the global and domestic economies. Rates are still expected to follow an upward trend as the year progresses. As overall economic activity gets back on track, rates will likely rise to keep inflation in check. This window of opportunity for buyers to lock in these historically low interest rates may not remain open much longer. This Month's Video Topics For Home Owners, Buyers & Sellers Following in the footsteps of its counterpart Fannie Mae, Freddie Mac is offering a summer sales promotion for buyers who purchase a home from its inventory of foreclosures or HomeSteps properties. Since banks typically sell foreclosures “as-is” without incentives, warranties, or repairs, this incentive could help buyers view a HomePath property more like a traditional sale, and less like a distressed property, during their search process. For offers received by July 31 that close by September 30, Freddie Mac is offering: 3.5% in closing costs to buyers $1,200 bonus to buyer agents This is on top of the incentives already being offered: A two year HomeProtect Home Warranty Up to 30% savings on new appliances Note that this program comes with a few eligibility requirements, which includes the home must be a single-family, owner-occupied, financed dwelling used solely for residential purposes.

The Power of Leverage

Blockbuster was founded in 1985. They owed their early success to some very simple innovative ideas. They were one of the first movie stores to introduce a computer system that would scan the rentals, making it much easier to track their inventory. They stayed open late, they displayed the movies on the shelves (instead of behind the counter), and they refused to carry adult films.

As Blockbuster grew to become the “Wal-Mart” of movie stores, they began to lose their way. It wasn’t the bloated mergers that sparked the downfall of Blockbuster, rather it was their inability to use technology to continue to innovate.

Blockbuster wasn’t in the business of having brick and mortar movie stores, they were in the business of getting movies to consumers…they forgot that.

Netflix was founded in 1999, they began as a “DVD by Mail” company. As technology advanced, Netflix quickly adapted and began streaming videos to consumers online. They will continue to prosper as long as they continue to innovate.

Gut Check time – Are you innovating?

How are using technology to connect with consumers (be specific)?

Are you just “on” Facebook or do you have a strategy?

How are you measuring your success?

How are you integrating “social” into the rest of your marketing?

In the next 6 months, what do you hope to accomplish with “social”?

I’d love to hear what you are doing with your marketing strategy and how has it impacted your business – please share below!

Scott Crouch-KW Edge

Crouch's Padres Team 2011

Crouch's Padres 2011 from Scott Crouch on Vimeo.

Its time for Baseball

Tomorrow its the Dodgers at 8am

Scott Crouch

2010_11, ANGELS, Fall 2010

2010_11, ANGELS, Fall 2010

Angels Team 2010 Pony League

Broker Min with Sam Farris

Scott Crouch on Keller Williams Profit Sharing and what it can do for you.......

Gary Vaynerchuk and Keller Williams EV

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Why I wrote the book crush it

He is coming to AZ and you don't want to miss his talk.... remember click discount code "crouchman" for your discount and a book. See ya soon and CRUSH IT!!!!!!

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This is a must read for anyone in the Real estate business...




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Estimated Supply of Homes in Arizona

While the overall estimated months of supply may be 3.4 months for all ARMLS properties listed in Greater Phoenix, the breakdown of the estimated months of supply for residential properties under $50,000 is 1.2 months compared t0 134 months or 11.2 years for properties over $3,000,000. The estimated month of supply jumps from 4.3 months in the $300,000 to 349,999 sold price range to 7.4 months in the $350,000 to 399,999 and generally increases as the price range increases.
Crouchman

Who is Buying Residential Properties in Arizona Today?

Great values and affordability are driving the market. In June, I estimate that 45-50% of purchases were made by investors and second home buyers. Investors will rent their investments, and second home buyers now have a winter home. And I estimate around 30-35% of the purchases are by first time homebuyers. They are buying because of affordability and because of the first time homebuyers tax credit of up to $8,000 or ten percent of the purchase price.

Crouchman