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Wednesday, August 24, 2016

How Inventory Levels Affect Home Buyers and Sellers

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Whether you’re a buyer or a seller, inventory levels are important information that you need to know. It is also important to have a real estate agent who can tell you what inventory levels are and how they can hurt or help you, depending on your situation.

If you’re a seller, your agent should be able to tell you the inventory levels in your area as they pertain to you. For example, we could look at the Crawford Report and see that there are 134 days of inventory in the Cave Creek area. What does that mean to you? Not much. There are many different types of properties, and you only need to know how inventory levels pertain to your specific home. This information is critical in determining how you’re going to price it.

Inventory levels determine both buyer and seller strategies.

For example, if there are only one to two months of inventory, I would price your house about 10% higher than its current market value. If there are five to six months of inventory, I would price the house 10% lower in order to be competitive and get it sold. Otherwise, you could be on the market for months and lose value daily. If you’re somewhere in the middle (three to four months), we’d price it spot-on.

Let’s flip the coin and examine the buyer’s side. If you’re looking for a property at $250,000 or less, that’s a very hot market right now. You’d be seeing low inventory levels, which brings with it the possibility of encountering multiple offer situations on a single property. Again, you need an agent who knows that this is coming and can set you apart from the rest so that your offer gets accepted. I would personally estimate that seven or eight out of every 10 agents don’t even know how to calculate inventory levels.

Hopefully this information helps you. If you have any more questions about inventory levels or real estate in general, don’t hesitate to reach out to me by phone or email.

Thursday, August 4, 2016

10 Ways to Save for a Down Payment

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Buying a Greater Phoenix Home? Search all homes for sale

If you rent a house, you're paying someone else's mortgage, and if you rent an apartment, you're probably just filling an investor's pockets with cash. Buying a home is a great way to spend money on your housing that actually builds equity. It's not only a home that you own, it's an investment, a great way to build future wealth, and a point of pride.

Of course, you may want a home, but simply can't afford to buy right now. You're definitely not alone. A recent survey by a personal banking firm reported that one in five Americans don't even have a savings account, and a significant portion of those that do don't even have a balance on that account.

One of the hardest parts of affording a home is coming up with the down payment. In the Greater Phoenix area coming up with a minimum of 3.5% up to 20% for a down payment may seem daunting, but it's not impossible. I've found these steps to be helpful for clients in the past who thought they'd never be able to come up with a down payment.
1. Set a target goal. Talk to a mortgage professional to find out how much home you can afford. That way, you'll know roughly how much you need to save for a down payment. Research shows that people who have specific dollar amounts in mind for a savings goal have a better success rate.
2. Assess your spending habits. Don't just make a rough audit of your monthly rent, utilities, insurance, and grocery costs. Really look into your monthly bank and credit statements from the last three months to see where your money is going. That will help you really find out where you can start to cut back.
3. Shrink your TV package. The average cable bill hit a record $99.10 last year. That's nearly 40% higher than the average from 2010! You can always - ALWAYS - call your local provide and try to negotiate a lower rate. If they have competition, use that as leverage. Also consider consolidating to only streaming services like Netflix, Hulu, and Sling TV.
4. Drop the gym membership. This could be tough if you frequent the gym - but many of us don't. Think about what you can do outdoors, and research some of the endless home workouts available online.
5. Unload your stuff. This can be done locally or online, of course. Even niche items can be sold with online services like Craigslist and eBay. You may not be sitting on a fortune of stuff that people will pay for, but in combination with other savings, it will make a difference.
6. Downsize your apartment. In Phoenix, moving from a one-bedroom to a studio could save lots of money without sacrificing too much space. This can also help you purge some unnecessary belongings, which can also bring in some more cash. A smaller space can also create savings in heating and cooling bills. Every dollar counts!
7. Get a side gig. You're probably thinking your 9 to 5 job is enough work, but think about opportunity cost. That hour you just spent watching the Kardashians or the same episode of Sports Center after work is $10 you could have made pouring coffee at the local coffee bar, driving for Uber, or doing freelance work for services like TaskRabbit or AgentAnything. A couple of night shifts or even a single weekend shift at a part-time job could contribute thousands toward your future down payment.
8. Open a high-yield savings account. If you're saving more or earning more with a new part-time gig, don't keep that money in your checking account where it's not accruing any interest. High-yield savings account offer daily access to money and accrue interest daily as well.
9. Get a cash rewards credit card. Ditch the no-frills credit card for one with cash-back rewards. It's an easy way to earn extra cash - if you consistently pay your bill on time each month. Credit cards typically have higher interest rates.
10. Save your tax refund. This is a nice yearly chunk of change depending on your work. If you can commit to socking away your tax refund, it'll be easier not to spend it when the check shows up.

If you have more questions about how to save for a down payment, don't hesitate to ask me! I can help you find out how much home you can afford and what you need to do to reach your goal.

How We Impressed Jackie and Linda With Our First Time Buyer Process

Tell me about your experience working with Riddle Realty.

"Riddle Realty is absolutely the most awesome realty team around. They are great with first time buyers. They walk you through the process from start to finish. It's a wonderful experience. They are all awesome."
-Jackie Westbrook
"Kodi is a spit-fire. You definitely want her on your side. Give them a call and they'll do a great job for you!"
-Linda Peterson

To contact Riddle Realty, call (480) 207-2645 or email