All posts in "Residential"

Experts Say Multifamily Is Key To Arizona’s Economic Growth

 

Via azbigmedia.com

With the 2018 legislative session right around the corner, the Arizona Multihousing Association (AMA) is finalizing its policy priorities for the year. Similar to years past, the industry will be focusing on protecting private property rights, preserving key economic development tools and supporting policies to reduce regulatory barriers for owners, operators and developers of apartment communities in Arizona.

As Arizona continues its efforts to attract large employers into the state, it is critical to preserve key economic development tools used to attract new investment. While Arizona looks to compete with its neighbors, retaining or creating new tools to attract investment and job creators will be a priority for the apartment industry.

As the demand for apartment homes continues to outpace the supply of new units, it is critical, now more than ever, to ensure that policies, whether enacted at the state or local level, do not not impede the positive economic growth taking place across the state.

 

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Bill Gates’ Smart City In Arizona Is Not Smart, Not A City, And Has Little to Do With Bill Gates

 

Via slate.com

Here are some things you should know about the smart city Bill Gates is building in Phoenix.

It’s not a city, nor is it “smart,” nor does the Microsoft founder appear to be involved in any meaningful way. And when outlets like CNBC say it’s in Phoenix, well … the plot of land in question is some 40 miles west of Phoenix, on the western edge of the metropolis’s westernmost suburb.

Still, it appears to be true that Cascade Investment LLC, the firm that manages an uncertain number of billions of Gates’ money, used a subsidiary LLC called Mt. Lemmon Holdings to invest $80 million in a greenfield development project here—if the term can be applied to the very-not-green Arizona desert.

 

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Tiny Homes Bringing Big Business For Developers

 

Via azdailysun.com

In the months since Coconino County approved rules for tiny homes, Amanda Acheson, the county’s sustainable building program manager, has been contacted by “at least a couple people a day” who are interested in building or living in a tiny home.

“A lot of the people I talk to are teachers, I have worked with nurses, retirees, students and anyone who wants to live more simply,” Acheson said. “These can be transitional homes, either for young people trying to transition into the housing market or people who are retiring and want to downsize.”

The growing interest in tiny homes, which are generally defined as a dwelling unit smaller than 400 square feet, has also created new business opportunities for those interested in building them.

 

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Bill Gates Just Bought Buys $80 Million Piece Of Land In Arizona

 

Via tech.co

In recent months, tech companies like Facebook and Google have purchased huge chunks of land in Menlo Park and Toronto, respectively. The goal of these purchases has been fairly straightforward: they want to build smart cities for employees and citizens alike. Well, it might be time to throw another tech giant’s name in the mix, as Bill Gates has announced his $80 million purchase of land in Arizona, as reported by Business Real Estate Weekly Arizona.

The area, dubbed Belmont, is nearly 20,000 acres nestled in the far West Valley of Arizona zoned for up to 80,000 residential homes and nearly 4,000 acres of office, industrial, and commercial property. And while Microsoft hasn’t come out and publicized any plans for a smart city, the proof is in the pudding.

“Belmont would create a forward-thinking community with a communication and infrastructure spine that embraces cutting-edge technology, designed around high speed networks, data centers, new manufacturing technologies and distribution models, autonomous vehicles and autonomous logistics hubs,” read a statement from the property owners.

 

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AZ Community Goes 80% Off-Grid

 

Via utilitydive.com

The Jasper community will not be wholly-independent of the Arizona Public Service grid, but developers told PV Magazine that it will supply up to 80% of its own energy and will use otherwise-wasted baseload generation from the Palo Verde nuclear plant when demand is low, from 2 a.m. to 5 a.m. each morning.

Sonnen Director of Business Development Olaf Lohr told the magazine that the development would be an overall benefit to APS’ grid, helping to address load curves. In addition to taking power from the nuclear plant, Jasper will soak up excess solar production during midday hours when demand is low.

Dave Everson, CEO and founder of Mandalay Homes, said in a statement that a “true renewable energy future is not possible for our society, or for any society, without the deployment of distributed energy storage resources that properly manage clean energy production, storage, grid usage and home energy demand.”

 

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Arizona Doesn’t Have Enough Construction Workers; Contractors Increase Wages

Via azcentral.com

Construction workers in Arizona should ask for a raise, if they haven’t already.

The state and metro Phoenix don’t have enough carpenters, electricians, framers, painters and plumbers, according to a new study from the Associated General Contractors of America.

About 75 percent of the Arizona contractors polled say they are having a “hard time” filling hourly construction jobs.

That’s slightly higher than the 70 percent of U.S. contractors acknowledging the same problem, said Stephen Sandherr, chief executive officer for the contractor trade group.

The median hourly wage for construction workers in metro Phoenix is $19.50, according to the U.S. Bureau of Labor Statistics. Contractor supervisors typically earn the most —$29 an hour. Workers helping electricians and plumbers can earn the least — $13.

Arizona’s construction industry lost more than 200,000 jobs during the housing crash. Many of those workers went to other states to find jobs and haven’t returned.

The Valley’s homebuilding market is still recovering from the crash, when new-home construction fell from more than 60,000 houses in 2006 to fewer than 10,000 in 2009.

This year, at least 19,000 new houses are expected to go up in the Phoenix area.

About 74 percent of the Arizona contractors polled said they expect to hire more construction workers this year. And 68 percent say they have already increased pay for those jobs, but did not provide amounts.

The Valley’s construction labor shortage has led to contractors offering cash bonuses to draw workers away from competitors, say homebuilders.

Now, there are about 111,000 construction workers employed in Arizona, up 4 percent from last year, according to the federal government.

Sean Ray, workforce development manager for Phoenix-based Sundt Construction, said his company is working with community colleges to create more internships and apprenticeships to draw more workers.

About 1,600 U.S. contractors were surveyed for the research. The Associated General Contractors didn’t break out how many of those firms were from Arizona.

 

 

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Arizona Hasn’t Fully Recovered From Recession

As the U.S. economy enters its ninth year of expansion this month, many Americans feel the recovery has been incomplete — and the numbers back them up.

Five states — Arizona, Connecticut, Mississippi, Nevada and Wyoming — still haven’t regained their levels of gross domestic product from before the financial crisis, more than five years after the country as a whole hit that milestone. Eight states are below prerecession levels of employment. And 15 have home prices that have yet to rebound fully.

While each of the states has individual obstacles, they illustrate how growth has lagged outside of the nation’s largest cities in New York, California and Florida. And though President Donald Trump won some of the states last November after highlighting sectors and regions that have lagged for years — including, for example, coal mining in West Virginia and manufacturing jobs in the Midwest — the pain hasn’t been limited to Republican territory.

“The hallmark of the recovery is that it is being driven by the nation’s largest metro areas,” said Mark Zandi, chief economist at Moody’s Analytics in West Chester, Pennsylvania. “Metro areas have attracted millennials and boomer empty-nesters and are globally oriented, benefiting from global capital inflows. Rural economies that are dependent on commodity-based activities have suffered.”

Wyoming — which has the second-smallest economy and depends on mining for one-fourth of GDP — is a prime example, having suffered the biggest percentage decline in payrolls from the start of the recession in December 2007. The state, which went for Trump, is likely to be among the final two to return to peak employment, in 2022, according to forecasts by IHS Markit economists.

The state’s tourism business, including the Jackson Hole resort and park area, was also slow to recover in the wake of consumers’ household wealth dropping, said Anne Alexander, a University of Wyoming economist. While tourism has since bounced back, the state’s huge energy sector has slumped since 2014.

“There’s been a significant slowdown in the past couple of years,” she said. “Natural gas prices fell first, then oil, and then coal production took a dive.”

The recent energy downturn has taken a toll on a number of states. Moody’s Analytics considers Alaska and West Virginia — both big producing states — now the only two in recession. Even so, energy states have been leaders in increasing production and employment since 2007, including North Dakota, South Dakota and Texas, which benefited from earlier booms in prices as well as new lower-cost production techniques.

Nevada has also had a tough road back, having failed to reach prerecession levels of GDP and home prices. It was among a handful of states, also including Florida, Georgia, California and Arizona, where the 2006 housing bust was particularly severe. Las Vegas hotels, restaurants and casinos suffered when consumers bolstered savings in the wake of the 2007-2009 downturn.

In northwestern Nevada, business at 600-employee Q&D Construction Inc. is growing again but hasn’t returned to 2006 levels when it employed 1,100 people. The company builds roads, hospitals, schools and airport facilities as well as housing.

“Things are coming back,” but Nevada “has not gotten back to where it once was,” said Lance Semenko, Sparks-based Q&D’s chief operating officer.

The 4.7 percent unemployment rate in Nevada, though below the 5.1 percent level when the recession began, remains above the housing-boom figure of 3.9 percent last seen in early 2006. Nevada, which voted for Clinton, had the highest percentage of homes with mortgages in excess of the value of homes, or negative equity, at 12.4 percent, followed by Florida, Illinois, New Jersey and Connecticut, according to real estate researcher CoreLogic Inc.

“Our recession was longer and deeper so naturally it will take us longer to recover,” said Stephen M. Miller, director for the Center for Business and Economic Research at the University of Nevada at Las Vegas.

The regional disparities aren’t holding back Federal Reserve policy makers from raising their benchmark interest rate and eyeing a reduction in their $4.5 trillion balance sheet. Central bankers, though mindful of the uneven circumstances, look at the country as a whole when making decisions and generally consider the 4.3 percent U.S. unemployment rate to be below the level consistent with full employment.

“The national recovery is absolutely complete,” said Stanford University economist Robert Hall, who heads the National Bureau of Economic Research committee that dates recessions.

Other issues plaguing the laggard states include slow growth in federal spending in New Mexico and below-average education levels in Mississippi and Alabama, economists said.

Connecticut is another story. In the New England state, which went for Clinton, General Electric Co. last year announced it was moving its headquarters to Boston, followed by Aetna Inc. deciding in June to relocate to New York City. Connecticut’s bonds were downgraded in May after the state faced a widening deficit. Florida Governor Rick Scott even visited the state in June to try to persuade companies to move south.

“Taxes and spending that can’t be sustained” are hurting the economy, said Don Klepper-Smith, chief economist at consulting firm DataCore Partners LLC in Durham, Connecticut. “Lack of fiscal discipline is creating an air of uncertainty. There is a loss of confidence in the business community.”

“We are underperforming in a rather dramatic fashion,” he said.

 

bloomberg.com

Via bloomberg.com

 

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Scottsdale-based Clayton Nash Real Estate Expands Into Texas

Via azbigmedia.com

Arizona-based real estate brokerage Clayton Nash Real Estate expands to Texas with a new office in Houston. Clayton Nash Real Estate is a new technology-focused real estate firm offering agents an unprecedented marketing program that includes time saving programs for agents, cutting edge lead generation and sales technology with ongoing sales training and support that puts both real estate agents, homebuyers and sellers ahead of the curve. Houston marks the first out-of-state office for Clayton Nash, which plans to hire up 1200 agents this year.

“We founded Clayton Nash Real Estate because we believe it’s time for the brokerage to evolve,” said Peter Lupus, Founder and CEO of Clayton Nash Real Estate. “In today’s fast-paced world of real estate, the traditional approach to buying and selling homes is outdated, and there is a new formula for success in selling real estate where agents can work smarter and not harder, sell homes faster and for more money, and ultimately increase their bottom line by minimizing traditional overhead and maximizing technology with the next-generation tools and resources we provide,” he said.

Agent profitability and company culture are important component of Clayton Nash Real Estate. The company’s compensation structure and “together we can” work ethic is designed to help agents sell more homes and generate more income for themselves and their clients.

Every Clayton Nash agent receives a cadre of assets and services to effortlessly market themselves and their listings 24/7. From a personally branded web page to a mobile optimized agent IDX website with mobile apps to an easy-to-use CRM including an intelligent activity stream,lead-nurturing software and real-time lead alerts. Clayton Nash’s comprehensive system is designed to maximize productivity and profitability by demanding awareness, generating leads, and simplifying day-to-day management of listings and marketing at the touch of a button.

At most traditional brokerage firms, the majority of these assets are paid for by the agent and expensive to maintain. At Clayton Nash, all of these resources and more are included on an ongoing basis. From soup to nuts, everything agents need to take their business to the next level comes standard at Clayton Nash.

“Our philosophy is simple – by giving our agents all the tools and training they need to succeed – they will. We realized it was overwhelming and expensive for real estate agents to modernize their business with the latest software and technology in order to compete for listings and sales by themselves; it’s a Mission Possible with Clayton Nash Real Estate,” Lupus explains.

Another challenge facing agents today is thatthose who have been engaged with technology through the tech revolution have already paid to modernize their website, add technology and eliminate marketing tools that have become obsolete at least once already.

“Agents are quickly realizing that it’s impossible to keep up with constantly evolving technology unless you align with a brokerage like ours that provides all of the high tech tools and technology they need to stay at the top of their game,” Lupus said.

Prominent Austin real estate attorney andbroker Robert Ramirez will serve as broker of record. Mr. Ramirez has served as a real estate attorney and agent in the state of Texas for over a decade and is currently a member of The State Bar of Texas, the Texas Real Estate Commission, the San Antonio Board of Realtors, the Houston Association of Realtors, the Texas Association of Realtors and the National Association of Realtors.

For more information about Clayton Nash Real Estate and to learn more about becoming a Clayton Nash agent visit www.claytonnashcareers.com or call (888) 795-6274. For more information about Clayton Nash Real Estate and to view featured property listings visit www.claytonnash.com.

 

 

 

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With Flagstaff Homeowners Staying Put, Demand Outstripping Supply

Via azdailysun.com

After three months of searching, Flagstaff resident James Yih found a home he liked and could afford. Yih discussed the home, which was on the market only one day, with his realtor, and decided to make an offer on the house, offering $14,000 above the seller’s asking price.

Later, he learned the seller had received 10 offers on the home, which ended up selling for $267,000, $17,000 more than the original asking price.

So it was back to the drawing board for Yih, who ended up buying a home in University Heights in March, nearly eight months after beginning to seriously look for a house.

“I thought three bedrooms, two bathrooms, a yard and a garage was pretty basic,” Yih said. “But the price you pay to get those things is pretty steep.”

Yih’s situation is hardly unique, with many houses priced below the median price of $376,500 selling within a few days, often receiving multiple offers in a short time span, said Lisa Paffrath, the president of the Northern Arizona Association of Realtors and the realtor who worked with Yih.

“If a house is in good condition and it’s under $350,000, the house goes fast,” Paffrath said. “Even if the house needs some repairs, it will go quickly.”

Paffrath, who recently sold a home she and her husband had been renting out, said she did not even have to put the home on the market before a client in her real estate office made her an offer.

A lack of inventory at a price that is affordable for the Flagstaff workforce, paired with prices that are comparable to what they were before the Great Recession has created a difficult situation for homebuyers in the area, many of whom cannot afford to buy a house.

“In my opinion, when you look at incomes, I can’t see housing prices continue to go up,” Paffrath said. “It’s getting close to a point where the town won’t be able to support it anymore. When you don’t have the jobs to support the prices, we are looking at the people who keep the town going having to leave Flagstaff.”

However, Paffrath said most new development in and around the city is at least a year away, meaning inventory will still be low until new homes come on the market.

According to the U.S. Census, the median family income in Flagstaff in 2015, the latest year available, was $66,000.

Devonna McLaughlin, the executive director for Housing Solutions of Northern Arizona, said a home is considered to be affordable if a person or family does not spend more than one-third of monthly income on housing and utility costs, meaning a family making the median amount in the city would have about $1,800 to spend on housing monthly. With a median price of a home reaching pre-recession levels, McLaughlin said buying a home in Flagstaff can be out of reach for many families.

Karen Flores, the sales manager and loan originator at Academy Mortgage Corporation, said a family in Flagstaff with about $1,800 to spend monthly on housing costs can generally afford a $270,000 purchase price, well below the area median price for a single-family home.

“More and more of our clients are struggling with costs in Flagstaff,” McLaughlin said.

Both McLaughlin and Paffrath said, despite high home prices, interest rates remain low, which is a benefit for those looking to buy.

However, even though prices are about where they were before the housing crash, Paffrath and McLaughlin said they have not seen the risky and predatory practices by buyers and lenders that occurred before the recession.

“People are being more responsible when it comes to a monthly payment,” Paffrath said. “Now people are asking about what their monthly payment will be, how the neighborhood is, how the schools are, and before the recession they never asked that. People are doing their homework more.”

People looking to invest in property are also being more conservative with their buying now, Paffrath said.

“I think investors learned their lesson, because they made a lot of mistakes,” she said.

Those in the housing business are also not seeing the predatory lending that was happening before the crash, Paffrath said.

“Before, people were putting no money down,” she said. “You don’t see that anymore.”

McLaughlin agreed, and said before the recession, people were getting adjustable-rate mortgages that caused the amount of money they owed to grow over time, as well as other types of “predatory or creative lending.”

“Lending hasn’t loosened up like it did then,” she said.

Flagstaff could also be a unique case, McLaughlin said, mentioning that prices have gone up around the nation, but other markets might not have reached the level of unaffordability that Flagstaff has reached.

Flores said she often sees people unable to qualify for a loan, but said there are a variety of factors, including debt and credit score that can disqualify a person or family.

However, Flores said if people are willing to be flexible, including considering manufactured homes or buying outside of the city, there is housing available.

Most buyers in Flagstaff rely on a dual-income household in order to be able to afford to buy, John Rich, the branch manager of Wallick and Volk said. However, he said he knew of people with a single income able to qualify for a loan because they did not have debt and had a good credit score.

Both Flores and Rich said they have not seen the same troublesome lending and borrowing practices that happened before the recession.

“Before the recession, they were giving out loans like candy,” Rich said, adding that buyers with bad credit or bankruptcy were able to qualify. Now, buyers must be more qualified in terms of credit history and outstanding debt, he said.

Many of the risky lending products have become illegal, Flores said, and lenders are requiring more documentation and proof that the buyers will be able to make payments before allowing someone to take out a mortgage.

Both Flores and Rich said the general rule of lending is that a person’s new housing payment, plus any payments on existing debt, should not be more than 45 percent of the person’s gross monthly income. After that point, the person generally will not be approved for the mortgage, Flores said.

To combat high prices in the city, Yih and other buyers have looked at creative ways to save money.

Tess Brill, a homeowner who closed on a house in Bellemont in March, said she had originally set her sights on living in the city, but found a newer house for a better price for her and her family outside the city limits.

“We looked in Flagstaff first, but everything that was in our price range was a fixer upper and we didn’t want that,” she said.

Brill, who had been looking for a house since October, had been renting in Flagstaff before deciding on the home, but said rent increased to a point where she would save money by purchasing a home instead.

“We wanted to keep our monthly payment around what we were paying in rent,” Brill said. “We knew that’s what we could afford.”

Brill said she was looking for a home with at least two bedrooms, two bathrooms and a yard, which she ended up finding. However, she said, if she were to do it again, she said she would have looked outside the city earlier.

“When we first started looking, interest rates were really low,” she said. “They are still low, but had we realized that and looked outside the city sooner, we might have been able to buy a bigger house.”

For Yih, splitting some of the cost with a roommate will help him save some money.

“I set myself up so I could afford this place by myself,” he said. “But I plan on having roommates. It will make the financial situation a little easier.”

The house has two extra bedrooms, and Yih plans to rent out at least one of them.

Housing Solutions of Northern Arizona, McLaughlin’s organization, is a nonprofit organization that can act as an impartial adviser to those looking to buy a home, as well as assist first-time homebuyers with programs available.

For buyers within the city limits who qualify, the Housing Assistance Program can help with up to $15,000 of a down payment, which is funded through the city of Flagstaff and the Community Development Block Grant. The assistance is a loan, but it requires no payments and no interest. The money is paid back when the home is no longer owner occupied or when the owner decides to sell it, McLaughlin said. About seven to 10 households a year are assisted by the program, she said.

For buyers in the region but outside the city who qualify, the Workforce Initiative Subsidy for Homeownership is a 3-to-1 matching program, which matches a contribution of up to $5,000, meaning the buyer can receive up to $15,000 through the program. McLaughlin said the program is also a loan, but assistance is forgiven after five years.

The reporter can be reached at cvanek@azdailysun.com or 556-2249.

 

 

 

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Only 2.5% of Tucson Homes Have recovered Pre-recession Values

Via bloomberg.com

You can’t blame a homeowner in Fresno, California, for viewing the thriving metropolis to its northwest with both envy and dismay. While San Francisco home values have surged since the recession, Fresno’s housing market is stuck in a rut. Less than 3 percent of homes in the city and its environs have returned to their pre-recession peak, according to a new study from Trulia. Median home values are a teeth-clenching $78,000 below their pre-recession peak.

The difference between the two California markets helps explain a key dynamic of U.S. housing a decade after the foreclosure crisis. Popular measures of the landscape, like S&P CoreLogic Case-Shiller Index and the FHFA House Price Index, show the market has recovered to levels last seen before the housing market went bust. But according to Trulia, this isn’t the whole, significantly bleaker picture.

Nationally, just 1 in 3 homes are worth more now than they were at their peak. While tech hubs in the Bay Area and Denver and job centers like Dallas or Nashville have seen home values explode past earlier highs, there are more losers than winners when you look across the country, Trulia’s analysis shows. And it’s really bad news if you live in Las Vegas, Tucson—or Fresno.

Many of the losers aren’t just losing—they’re getting trounced. There were 28 metros where fewer than 10 percent of homes have recovered their value since the bubble burst. Las Vegas has seen less than 1 percent of its homes returning to or surpassing what they were worth before the recession. The median sales price there is down a full $91,000 from its peak.

“It’s a reflection of just how well a metro area has recovered, broadly speaking,” said Ralph McLaughlin, chief economist at Trulia, adding that his findings largely correlate with other measures of metro-level growth, such as gains in income and total population.

As a result, it’s tempting to view these results through the prism of the 2016 election. Many of the metropolitan areas where home values lag the most are Rust Belt towns with little prospect for an immediate comeback, or Sunbelt cities whose peak home values were a product of the bubble that preceded the collapse.

McLaughlin says a zip code-level analysis offers a more nuanced view of the haves and have-nots. In much of the middle of the country, cities have stagnated while less populated regions lead the recovery. While it’s true coastal markets have experienced the lion’s share of appreciation, the majority of homes in pricey markets like New York, Los Angeles, Silver Spring, Maryland, and Fairfield County, Connecticut, are still worth less than a decade ago.

To be sure, Trulia’s research is based on its own estimates of home values, while the big indices are based on actual sales. Other research suggests a hot economy gives rural workers more choice, causing an outflow of potential employees to better jobs, often in the cities or on the coasts, potentially speeding a decline in home value elsewhere.

McLaughlin offers two more takeaways from his research. The high percentage of homes that have yet to recover their peak values shows that any talk of a housing bubble is premature. Also, the slow recovery may play a key role in a theme bedeviling local housing markets: There were fewer homes for sale in March than at any point since 2012, according to McLaughlin. The lack of full recovery may be causing some homeowners to delay listing their homes.

“If people are aware of what their house was worth 10 or 12 years ago, and the house is worth less now, they may be holding back,” he said. “They may be waiting, like you might with a stock, for it to get to a certain price—and then they will unload.”

 

 

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