Scottsdale housing market data illustrates bucking of trends, confirmation of others

A view of picturesque housing found in the central region of Valley of the Sun. Scottsdale real estate trends confirm some thoughts of the popular consciousness while it is bucking some preconceived notions. (Independent Newsmedia/Josh Martinez)

The tale of Scottsdale real estate could be one of its typical priminance over the surrounding metropolitan area, but more accurately housing experts contend, the truth is closer to one of segmentation rather than across-the-board affluence.

Over the last five years data shows a stable Scottsdale housing market with average sale point, price per square foot and the overall amount of money spent annually seeing steady increase.

While trends continue to shape the perspective of the American housing market embedded in those data points two empirical trends in Scottsdale are bucking the current mantra:

  • Over the last five years the number of listings has remained nearly constant with minimal fluctuations; and
  • The square footage of home sold over the last five years in Scottsdale has remained relatively constant.

“I think the building community has started to provide ‘The Jetsons’ in terms of housing — the high-rise, spacey condo, as I call it,” said Gary Shapiro, a staple of Scottsdale real estate, a Realtor and co-founder of Scottsdale Leadership.

“What I am seeing is that people are not necessarily gravitating toward that. They don’t like the parking. They don’t like the fact there aren’t neighborhood grocery stores and things like that. Unless you’re very wealthy, closet and storage space is very limited. You certainly can’t store a case of toilet paper from Costco.”

To his surprise, Mr. Shapiro points out, his hunch has can be quantified. A breakdown of average square footage sold in Scottsdale over the last five years illustrates his point:

  • In 2013 the average square footage of a single-family home sold in Scottsdale: 2,776
  • In 2014 the average square footage of a single-family home sold in Scottsdale: 2,793
  • In 2015 the average square footage of a single-family home sold in Scottsdale: 2,760
  • In 2016 the average square footage of a single-family home sold in Scottsdale: 2,773
  • In 2017 the average square footage of a single-family home sold in Scottsdale: 2,822
  • In 2018 the average square footage of a single-family home sold in Scottsdale: 2,881

“The average square footage, from the standpoint that if we had gone to an economic forecast any time in the early 2000s, you would have heard, ‘consumers will be purchasing smaller homes,’” Mr. Shapiro pointed out.

“The idea was that people would have changed their specifications — but the average sale hasn’t changed and that defies forecasters, economists or whatever else they are called. For the most part, it is the is the same size house being sold.”

Gary Shapiro

Mr. Shapiro has been selling homes for more than 40 years, is a premier broker at Coldwell Banker and has earned the coveted Realtor emeritus status from the National Association of Realtors.

A universal truth of Scottsdale housing, Mr. Shapiro, says is inventory is tight.

“For the most part, you should consider the market is reasonably priced and anything you get is a gift,” he said of the name of the game when buying a home between Scottsdale city limits. “From the macro view, if I or any of my colleagues can find you something that you like and you run the comps and the comps prove it is a realistic price. Don’t lose it.”

The evolution of Realtors

No name is synonymous more with Arizona real estate than Greg Hague of Hague Partners who has been selling real estate since his teen years and has formulated a new approach to bring the process for selling homes into the 21st Century.

“I grew up in the business,” he said while discussing his firm’s 72-hour program for selling a home — luxury or otherwise. “My dad was a Realtor in Cincinnati, building one of the top firms in the city. He talked real estate every night at dinner. I learned a lot and developed a love for the business.”

Greg Hague

“What made Realtors so valuable in the pre-Internet days was they were gatekeepers of information. Buyers didn’t have access to homes for sale inventory without contacting a Realtor. The only way they could find out a listing price was a local newspaper ad. Now buyers can go online and learn about anything they want. We are no longer the gatekeepers of information.”

For Mr. Hague, a lot must change for the real estate profession to endure into the 21st Century. “When my dad sold a home, he put up a sign, ran some ads, and hoped it sold during the six month listing period — and that is primarily what the industry does today. We need to change, and we need to start now,” he said noting that the same home selling strategies used at the turn of the 20th Century are still staples today.

“The 72-hour selling program developed by my firm (Hague Partners) is a new approach to selling homes, predicated on massive upfront marketing for the purpose of identifying virtually every potential buyer for a home before it’s allowed to be shown. The goal is to flood a home with prospects in a 72 hour period due to massive advertising for 2-3 weeks. Buyers seeing each other in the home creates a competitive environment, generating higher offers for our home sellers. Our program has worked extremely well. We had 102 closings in the first quarter of 2019, with many of our homes selling at or above full price!”

An underlying truth? Realtors work for sellers, not the other way around, so everything Mr. Hague does prior to releasing a listing publicly is to create a buzz around a seller’s home to drive up the price.

From heavily marketed open house scenarios to behind-the-scene glimpses of premier properties, Mr. Hague says the more hype around a property, the better for the home sellers.

Single-family housing changing ownership hands has been a staple of the Arizona economy historically and continues to be a barometer of macroeconomics to this day. (Independent Newsmedia/Josh Martinez)

“Every Realtor should be engaging in more creative, more intense, upfront marketing of homes to generate a flood of buyers quickly, to sell homes faster, at higher prices,” he said.

“Time on the market is acid to the price of a home. That’s why it’s important for Realtors to spend more on marketing their homes right after they are listed. We are paid by sellers!” Mr. Hague points out. “I believe Realtors ought to be focusing on more effective ways to generate higher prices for those sellers.”

Effective marketing or not, single-family, brick-and-mortar values continue to see dependable gains. Data provided by the Arizona Regional Multiple Listings Service shows:

• In 2013 the average price per square foot sold was $196.58 while the average sold price was $578,661.
• In 2014 the average price per square foot sold was $210.03 while the average sold price was $630,752.
• In 2015 the average price per square foot sold was $214.33 while the average sold price was $$630,354.
• In 2016 the average price per square foot sold was $222.15 while the average sold price was $650,380.
• In 2017 the average price per square foot sold was $231.33 while the average sold price was $683,080
• In 2018 the average price per square foot sold was $245 while the average sold price was $736,897.

At the end of the day, Mr. Hague says his hybrid approach — a combination of high-dollar digital and physical advertising — is designed to identify as many qualified buyers as possible prior to the listing being released to the public.

“We have sold several homes at or above price using this system,” he said of the 72-hour approach. “From about $300,000 up to the $900,000 price point is very, very hot. If the home is marketed right, the sellers do very, very well. I realize everything I am saying is very seller oriented. I am not against buyers. I just believe Realtors should focus on how to best serve the people who pay our commission … the home seller”

Boomtown: Scottsdale saw an explosion of multifamily building permits from about 2013 to 2018, but those filings have slowed down meanwhile leasing efforts being to ramp up in Scottsdale and valleywide. (File photo)

The beginning of a multifamily slowdown?

Over the last decade, apartment complexes, townhome development and cottage extensions have been transformed from multifamily dwellings to luxury escapes.

But multifamily dwellings — in all its forms: apartment, town and patio homes — have seen steady increases in their Scottsdale values.
Data from the Arizona Regional Multiple Listings Service shows:

  • In 2013 the average sold price for a multifamily dwelling was $263,098 and had an average sales price per square foot of $169.03.
  • In 2014 the average sold price for a multifamily dwelling was $262,724 and had an average sales price per square foot of $173.63.
  • In 2015 the average sold price for a multifamily dwelling was $265,896 and had an average sales price per square foot of $179.46.
  • In 2016 the average sold price for a multifamily dwelling was $276,909 and had an average sales price per square foot of $189.33
  • In 2017 the average sold price for a multifamily dwelling was $302,003 and had an average sales price per square foot of $205.67.
  • In 2018 the average sold price for a multifamily dwelling was $326,436 and had an average sales price per square foot of $221.90.

“We’re hearing that the rental market is cooling on a national basis, but not seeing evidence of that here locally,” said Scottsdale Area Association of Realtors CEO Rebecca Grossman.

“You really have to look at each geographic area. Some are high in Millennial tech forces that typically look for renting versus buying and rents continue to rise in our walkable communities — while other areas with a saturation of rental units are staying even.”

Rebecca Grossmann

Data gleaned from the ARMLS confirms Ms. Grossman sentiment.

In 2013 there were 2,625 multifamily listings sold carrying a market value of $690,626,870 meanwhile last year that number increased to 3,245 listings sold while carrying a market value of $1,059,284,877, ARMLS data shows.

Coupled with revitalized neighborhoods and an explosion of growing multifamily developments throughout Scottsdale the local housing inventory is tight in “The West’s Most Western Town.”

“There were pockets of more affordable, older homes in south Scottsdale, but they’re harder to find now because of revitalization,” said Sandy Adler of Arizona Best Real Estate, a Scottsdale Realtor.

Independent Newsmedia Arizona Managing Editor Terrance Thornton can be contacted at tthornton@newszap.com

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