Jay's Phoenix Area Real Estate (and more...)

If you are not familiar with Trulia, it’s a big giant site that provides real estate listings. They scrape or pull listings from multiple places and display listings for all to view, search and ponder.

They started in California, and have slowly branched out to a few other major markets. Now they are active in Arizona.

I got a call a couple of days ago from Kelly Roark, Vice President, Industry Development for Trulia. She provided this email below to let me know what was happening at Trulia. Kelly was a very nice, professional lady. I don’t think she or anyone at Trulia is trying to replace agents. She even says that we (agents) can provide the most accurate info on a property. And now I share Kelly’s email with all the avid readers of this blog:

Dear Jay,

Nice speaking with you this afternoon! As promised, here’s an update for your blog:

Since we opened our online door in September 2005, we’ve been working hard to build a great search tool for home buyers, real estate agents, brokers and home sellers. Our goal is to simplify the search process over multiple property Web sites from the time consumers turn on their computers, and then quickly point them to the richest source of property information on the listing brokers’ Web sites–the people who’ve often sat at a home seller’s coffee table and can provide the most accurate information on a property. Check out the latest at www.Trulia.com, including new features that you and your readers might be interested in:

• New state launches in big real estate markets. Trulia is now live in Arizona, in addition to CA, NY, NJ, TX, FL, PA, NV, IL and OH. Plus, we’ll be adding several more markets in July and will be nationwide before year end.

• Cool new product updates and features: Check out our new user search views (screen shots available at your request) to meet just about any preference in home viewing, as well as our school and census data:

• Gallery view – the latest in real estate search technology: if you’re a visual person and can’t be bothered by words, click on this feature and search by thumbnail photo rather than address

• Search results map with property details – Skip the double-click process with this new view option: as you click on property search results, the accompanying city map is replaced with property details on the right so you can quickly scan information

• Full map view – Trulia mapping to the max: view full-screen map details with this exciting, visually enticing new mapping feature

• School overviews and census information – Consumers can get a quick snapshot on Trulia.com of publicly available information that’s important within a home buyer’s search process – things like student/teacher ratio in specific markets, student performance, crime statistics, median family income, travel time to work, and more. Here are a few examples:

                    1. http://www.trulia.com/city/AZ/Phoenix/
                    2. http://www.trulia.com/city/AZ/Scottsdale/
                    3. http://www.trulia.com/city/AZ/Tucson/

• Leading Real Estate brokers sign-up: We continue to generate strong support and feedback from leading real estate listing brokers across the US and are driving traffic to many thousands of real estate sites. Recently we announced over 15 major brokers (see press release at the bottom) that have their listings indexed by Trulia, with dozens more joining every day. And in Arizona, broker leaders such as Realty Executives Phoenix, Realty Executives Southern Arizona, Long Realty, Russ Lyon, Century 21 Metro Alliance and Prudential Arizona Properties are on board as well as your site!

Feel free to contact me if you have questions, and please spread the word to all your friends, colleagues and readers!

Thanks,

Kelly
…………………………………………………….
Kelly Roark
Vice President, Industry Development
TRULIA Real Estate Search

Jay's Opine: Really not all that surprising. Do you think the value of your home increases as the structure ages and deteriorates?  Generally speaking, older homes are in more need of repair, have higher maintenance costs, and aren’t as energy efficient as newer homes. Yet home values tend to increase over time…. Hmmm. Is it the actual structure that increases in value, or is it the LAND the structure is sitting on that increases in value?  It’s all (well mostly) about the land…

Land values in and around the Phoenix area have exploded in the last couple of years. We recently listed and sold several 5 acre parcels inan area northwest of Phoenix called Whispering Ranch. As recently as two years ago, these parcels were selling for $8,000. Today's prices? $60,000 - $100,000. Don't you wish you'd bought a dozen two years ago? For more info, see our main website and our blog.

Land Prices Increasingly Drive Housing Markets, Fed Study Says
By Campion Walsh
From The Wall Street Journal Online (June 22. Article Link)

What is earnest money and why do I need it? The “book definition” of earnest money is: “A deposit paid by a buyer to a seller to demonstrate intention to complete the purchase.”

That pretty much sums it up. In Arizona real estate, earnest money is some amount of money, deposited in escrow, which helps show the seller that a buyer is serious. Normally the earnest money is applied to the buyer’s down payment at close of escrow.

Without earnest money, and the possibility of losing it, there is nothing to stop a buyer from submitting offers on multiple properties. Without earnest money, there is nothing to stop a buyer from just walking away from a contract days or weeks after it’s been accepted and the seller has taken their home off the market. Sellers want and need to know that a buyer is serious about the offer on their property.

How much earnest money do I need? The simple answer is, “the more the better”. The complicated answer (and one that’s virtually impossible to know in advance) is, “whatever it takes to make the seller know you are serious”. **Generally** speaking, 1% of the offer price is considered a reasonable amount. But like anything in real estate, there are no hard and fast rules. I’ve seen offers written with as little as $1 earnest money and as much as 100% of the sales price.

An example may be helpful here. Let’s say a seller gets two offers. They are identical in price, down payment amount, close of escrow date, etc. But offer #1 has a higher earnest money deposit than offer #2. Regardless of the true motivation of the buyers, the seller will most likely accept the offer with the higher earnest money amount. A significantly higher earnest money amount may even make a seller consider one offer over another even is there is difference is terms such as price, close of escrow, etc. Higher earnest money amounts signify to sellers that a buyer is serious and more likely to close the transaction.

Can I lose my earnest money? The short answer is yes. The complete answer is maybe. Again, generally speaking, your earnest money is “safe” unless you default on the contract. Should the seller default, your earnest money will be returned. In Arizona, the typical “inspection period” (or “due diligence” period) is 10 days. If the property you make an offer on doesn’t “pass” inspection, or if the seller declines to do requested repairs, the buyer can cancel the contract and get their earnest money back. There are also contingencies in the standard residential resale contract that a home must appraise for the asking price and the buyer must be able to secure financing. If neither of these contingencies are met, then generally earnest money is returned to the buyer.

Most earnest money is lost when the buyer backs out after the inspection period. In this case, the seller will almost always retain the buyer’s earnest money.

There’s nothing to be afraid of with earnest money. If you are serious about purchasing a home, you need to indicate to the seller you are serious. They’ll be taking what is probably their single largest asset off the market if they accept your offer. They need to know you are serious about completing the sale. That’s why a seller wants to see that you can get a loan, that you aren’t “fishing” with multiple offers, and that you aren’t going to back out at the last minute. A reasonable earnest money deposit helps reassure the seller you are serious about buying their home.