Jen Fifield bought her first home in Phoenix a few days ago.
After saving for five years, competing in a seller's market and learning the complicated mortgage process, she and her husband are no longer renters.
Metro Phoenix’s rapidly rising home prices during the past few years didn’t make it easy for them.
I've written about the area's growing affordable housing problem, including this past week's articles, but Jen has been a frequent reminder of how worrisome it is for many. She's my podmate in the newsroom, a watchdog reporter covering Surprise and Glendale.
I've heard her angst. Is now the time to buy? Will home prices climb or fall?
And there was the experience of going to Zillow and sliding the price bar down to what she could afford.
“I watched all the little red dots vanish in the areas where we wanted to live,” she said.
She and I had several conversations during the past few months about buying a home. Some days I could tell the process was getting her down. One week she skipped her morning workouts just to get an extra hour of sleep because of her second job – house hunting.
Here is some of what I told her, and what she learned.
Home prices in metro Phoenix have climbed 45 percent since the couple started saving for a home.
Rising prices are pushed by demand, which she and her husband encountered. Bumping into other couples while checking out bedrooms at open houses. Perusing an Opendoor property only to have others drive up to do the same.
“We would watch as homes were put on the market mid-week and then go under contract by the weekend,” she said.
The Millennial couple was not only competing with other first-time buyers but investors wanting to buy rentals and flippers going after homes they could fix up and make money on reselling.
The shortage of homes priced below $350,000 for sale in the Valley worked to push up prices quickly as buyers had to outbid each other in 2015 through early 2018.
They quickly extended their search radius a little farther out.
“In hindsight, it seems that this realization is a common rite of passage for many first-time Valley homebuyers," Jen said.
Jen, who makes a living trying to simplify complicated topics, experienced the difficulty of figuring out home loans, finding the right property and getting the best deal.
They found Phoenix homes they liked with enough space and a backyard for their dog. But they were too pricey or the homes sold before they could put in an offer. That's despite being ready with a down payment and pre-approved mortgage.
She went with Realtor Bryce Lugo, whom she knew from high school. He and his wife, Stefanie, with My Home Group Real Estate, helped navigate the process, aka taking calls while at the gym, before Valentine's Day dinner and early in the mornings.
When the seller accepted the offer, the inspector’s report about what needed to be fixed in the house was another shock, Jen said.
Inspection reports are one more negotiation point in a home sales. Who is going to pay to fix the roof or repair the cracks in a wall? In a sellers' market like we are in now, buyers typically don't get everything they want. And fixes add to buyers' costs.
My advice to Jen on taking the plunge into home ownership was, why wait?
She and her husband's purchase came as big Valley home price increases started to wane.
The Valley’s median home has dipped from a record $275,000 in June to about $273,000 now, according to The Information Market, a division of the Arizona Regional Multiple Listing Service.
Though it’s still a sellers’ market in metro Phoenix, the buyer is gaining an edge.
As Tina Tamboer, a senior housing analyst with the Cromford Report, put it: A buyer might now be competing with three other offers compared with 15 last year.
And the number of homes for sale in the Phoenix area during January jumped 78 percent from December, according to ARMLS. That means more homes for buyers to choose from and maybe fewer bidding wars.
Jen experienced how fast it can all move.
It took less than 30 days for the couple to close on their home after the seller accepted their offer.
“Before we knew it, we were at a title company office with pens in hand, ready to sign a stack of papers that we had probably read at some point, or maybe we hadn’t, but it didn’t matter because we were going to sign them," she said.
“I couldn’t help but hesitate as I slid the cashier’s check for a crazy amount of money across the table.”
But then she realized she would no longer would be paying rent — not a bad thing as the average rent in the Phoenix area climbed 8 percent in the past year. And that’s after five years of similar rent hikes.
Her mortgage payment actually will be less than her rent.
So congrats to my co-worker and friend on making the biggest purchase of her life.
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