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Why Buying a Vacation Rental is a Good Investment in Scottsdale, AZ

by Karen Picarello

Buying real estate can be a lucrative business, but it is risky. The market fluctuates, tenants may not pay dependably, and cash flow can be a struggle. First time real estate investors may want to go big with their investment, but many of us would struggle to make multiple mortgage payments. This risk is lessened when buying a vacation rental in Scottsdale, AZ.

Why Buy a Vacation Rental?

  • The best reason to buy a vacation rental instead of a long-term rental property is because you can use it! It can also be your second home you visit when you need to get away from the toils of life.
  • It’s a side hustle! Yes, you can have a second home and have other people pay for it. You aren’t going to use it all the time, so why not have it make its own money on the side?
  • The property will likely appreciate. Over time, most properties do become more valuable. Add any improvements, and it will appreciate that much more. This way, if you have to sell it, you’ll end up with a profit.
  • Options. There are many options for managing vacation rentals. If you don’t want to do it yourself, you can hire a vacations rental management service. This allows you to do practically nothing and watch your mortgage, insurance, and repairs pay for themselves through rental income.

Why Buy a Vacation Rental in Scottsdale?

It is important to buy a vacation rental in an area that is rated highly for the tourism industry. Scottsdale is definitely rated as a good place for vacation rentals. The hiking opportunities, proximity to Phoenix, Old Town, clubs, spas, and swimming pools (not to mention the weather!) make this one hot spot for tourism.

According to Mashvisor, Scottsdale had 4.5 million tourists there for overnight visits bringing 2.4 billion dollars for the city in 2017. Rental rates averaged $2,788 but were much higher at $3,308 in South Scottsdale.

Vacation rentals are good investments in Scottsdale because of the tourism, but they are also good investments because they make a good amount of money for the investor without a lot of work or risk. Tourism isn’t leaving the Scottsdale market, and many people enjoy the comfort of staying in a home rather than a hotel, so they can truly have the luxury of a home during vacation without the upkeep. Hire a vacation rental management service, and when it comes time for your vacation, you won’t even know they were there.

5 Reasons to Get a Real Estate Agent in Scottsdale, AZ

by Karen Picarello

The Phoenix area is booming, and housing for all of the incoming out-of-staters has been an excellent shift in the housing market for home sellers. However, it also makes it difficult for those entering the Phoenix-Scottsdale area to find the home they are looking for.

Many opt for rentals upon arrival in order to bide their time while looking for a more permanent location. This has caused a rental crunch that has driven up the prices of rentals, but the Phoenix area still maintains low rental rates in comparison to most other states.

Even then, it can be frustrating to wait it out in a rental knowing that your long-term residence is out their waiting to become available. That is why you need a real estate agent, especially if you are looking for a home in Scottsdale.

5 Reasons to Get a Real Estate Agent in Scottsdale, AZ

1. Local Knowledge

Scottsdale is known for its luxury neighborhoods, but you want to make sure you are getting into the right one. If you are looking for a family-friendly neighborhood, you won’t want to be in a neighborhood that caters to single night life and vice versa. Your local real estate agent can help you look for the neighborhood that fits your exact needs, so you won’t have headaches about your living region when you’ve already purchased the home.

2. Improved Communication

There are a lot of big corporations getting into the real estate game. Internet buyers and sellers aim to streamline the home transaction process, but they remove the intimacy that comes with a home purchase. These corporations are trying to make home buying about as convenient as getting an ice cream cone, and that leaves a lot to desire. One of the major things that is lacking in these sort of transactions is communication because there is no accountability. If you don’t like your home purchase, and you think your seller should have disclosed more, a large corporation won’t care. Local real estate agents have to communicate well and transparently because they have reputations to uphold.

3. Quality Homes

Speaking of large corporations who are getting in the real estate business, they are also getting in the home flipping business at the same time. This means the home you buy may have been flipped simply for profit, which could result in a lesser quality home. Home flippers may sell through real estate agents too, but a local agent is more likely to know the reputation of the flipper and only work with people who make sure their improvements are done well.

4. Improved Commute

Scottsdale is a short commute to Phoenix, but if you are making it daily, it can seem very long. Your local agent will know what neighborhoods have easy access to Route 202 and any other transportation tips for the area. You aren’t going to find that from real estate companies who aren’t familiar with the area.

5. Access to Amenities

If you are looking to live in Scottsdale, you’ve probably checked out some of the city’s amenities. Your real estate agent can make sure you are near your favorite golf course or country club, or you can look to live near shopping centers. The local real estate will know the nitty gritty of every area in Scottsdale, so you will enjoy your new life.

If You Like Sports, Scottsdale Delivers Via Its Neighbors

by Karen Picarello

If you’ve already been looking at Scottsdale as a potential future home, then you already know it is an affluent area of town known for its lower crime rates and nicer neighborhoods. However, you may not have thought of the sporting benefit. At less than 20 miles away from Phoenix, Scottsdale get you very close to the action of multiple sporting events.

Sports Teams You Can Watch Near Scottsdale (Phoenix Area)

1. Phoenix Cardinals

Not only is the State Farm Stadium (formerly University of Phoenix Stadium) the home to the Phoenix Cardinals, but it is also the location of the annual NFL Fiesta Bowl. Located in Glendale 20 minutes northwest of Phoenix, this modern stadium has a retractable roof and was the home of the 2015 Super Bowl. The Cardinals have not won a Super Bowl yet, but they typically make it to the play-offs and are a force to be reckoned with.

2. Arizona State University’s Sun Devils

The only thing wilder about sports than professional fans is college fans, and the ASU Sun Devils has 9 men’s and 11 women’s PAC-12 Varsity teams.

3. Arizona Diamondbacks

The Arizona Diamondbacks are Arizona’s Major League Baseball team. Chase Field is located in downtown Phoenix and has everything MLB has to offer. Buy you some peanuts and cracker jacks because you won’t care if you never go back to watching any other sport.

4. Phoenix Suns

If pro basketball is more our style, you’ll have to make it to Talking Stick Resort Arena for a Suns game. They’ve had a little bit of a lackluster history, but almost any NBA game is worth seeing if you are a fan.

5. Arizona Coyotes

Glendale is also home to Arizona’s hockey team, the Arizona Coyotes. Gila River Arena is home to these ice warriors. If you want to see some good body checks and some amazing stick work, the Arizona Coyotes will deliver a game that is full of the intensity that only hockey can deliver.  

6. Phoenix Mercury

If you like the Suns, then you’re sure to love the Phoenix Mercury, Arizona’s WNBA team. Talking Stick Resort Arena is also home to this team, and they’ve won 3 WNBA Championships.

You may be thinking that if you want to be close to the sporting action of Arizona, you should move to Phoenix or Glendale. This may be true for some, but Scottsdale delivers that high-end lifestyle without taking away access to Arizona’s premium sporting events.

Big Investors: Friend or Foe to the Housing Industry?

by Karen Picarello

            A June 19th article in the Wall Street Journal depicts an interesting change in the Arizona housing market that may disrupt the entire housing industry. For better or worse, this change is giving the upper hand to large investors with access to high computing power. But it may benefit the individual home buyer and home seller too. It’s still in its early stages, but big companies like Opendoor and Zillow Group, Inc. are buying Phoenix real estate and flipping homes for a quick resale. These sales may be with individuals, but they are often sold to big landlords who control a large amount of rentals in the area.

            How do they do it? Using complex computer algorithms that notify the big investors immediately when a house comes on the market that looks like a good investment. Using these algorithms, the company knows how much to offer based on how much they can profit by its resale and how long it is expected to be on the market. It’s reliable to a certain extent, but it isn’t without risk. The large investment companies focus on high volumes of sales because they aren’t making huge gains on each transaction. However, they are able to create a very large volume, so it is lucrative. According to the Wall Street article, these house flipper companies have bought thousands of homes in the area, and more than 22,000 rentals are now owned by big investors.

            It seems a little too corporate, but there are advantages to this non-hostile takeover of the housing market by corporate America. A person selling their residence may get a higher offer from these investment companies if the computer dictates that it is worth the higher price tag in order to warrant the sale. Also, these algorithms are bringing technology to the real estate process. In some cases, using an app can get you electronic access to viewing homes instead of relying on the schedules of homeowners and real estate agents.

            It is too early to tell how big investment companies are going to impact the housing industry, and if home prices fall, it would put a quick end to this money-making trend. However, right now these companies are modernizing the housing market, and there are some real benefits for both parties involved in a home purchase. However, the large investment companies owning so many rentals and controlling so much of the housing market is a bit ominous. It renders many people who have to get mortgages to buy a home powerless in the face of these large companies with cash buying power.

Why is Phoenix Real Estate So Hot?

by Karen Picarello

The Phoenix real estate market is booming, and it’s affordable for the moment. How is this market bouncing back from the horror stories of suburbs that haven’t fully bounced back from the recession? It’s all about the job market.

The Recession Hurt

The economy of Phoenix before and during the recession was not as diverse as it is today. When service jobs and construction stalled, Phoenix was forced to adapt. It had too many empty houses. As a result of this adaptation, the entire economy recovered.

Tech and Bioscience

This adaptation and diversification happened the most in the technology and bioscience sectors. Bioscience in particular has been an economy and education milestone for Phoenix, and foundations like the Flinn Foundation continue to cause this field to grow by providing scholarships and opportunities. Technology giants like Plexus, Lifelock, and GoDaddy keep the tech sector going. This is not to mention all the other sectors that thrive due to this, such as the medical technology sector. All of these sectors are recession-proof, so it is safe to say that Phoenix is the place to be if you want to have some economic security.

Jobs + Population Boom

The tech and bioscience diversification that started in Phoenix has brought many young people to the Phoenix area, and they have high-paying jobs. The people moving to Phoenix are not all from the area. Since 2010, over half of a million people have moving to the area. Over 300,000 of those were from different parts of the country, and over 100,000 of them were from foreign countries. These people need places to live, which has helped the construction business as older regions of the city get updated.

The Housing Market

Right now, the housing market is affordable, and median home prices are below $300,000. This means that single people can afford to buy homes. But the market won’t stay like this for long. As more people move to the area, demand will increase for homes, and it will exceed supply. This will drive up prices, and before you know it, it will be a seller’s dream market.

What does this mean for real estate?

It’s great news for real estate. Right now, people should be buying homes, and real estate agencies will thrive in a time of multiple home purchases. Soon, it will be thriving in a different way, and home sellers will enjoy the increase in their property values. It’s all about timing, and a thriving economy is good for everybody.

Why You Want a Real Estate Agent

by Karen Picarello

A recent collection of lawsuits has people wondering whether or not real estate agents are necessary anymore. In fact, they are being compared to video rental stores, an industry that is almost extinct in today’s world of internet accessibility.

Real estate information is readily available on multiple websites including MLS.com, Zillow, and Redfin. This has potential buyers and sellers feeling forced into contractual obligations with the realtor industry that force people to pay money to a third party in order to purchase a home. With standard rates reaching as high as 6 percent, it is understandable that people want change.

In the past, only real estate agents had access to all of the home listings on the market. Today, it requires a real estate license to get your home on the MLS, but you can pay out of pocket for this service instead of tacking the real estate fees onto the purchase price of the home. This is much less expensive, but you don’t get all the benefits of having a real estate agent.

This leads one to the question: what good is a real estate agent? This question has many hard-working agents exasperated at the thought that so many people undervalue their services. In reality, the home buying process is held to a higher standard because of the real estate agency industry, and agents simplify the process with their connections and know-how.

If you are selling a home, your real estate agent will interact with multiple buyers and direct them to your home when it seems a good fit. This is something that only live interaction with a person can accomplish. No amount of pictures online can replace this action for sellers or buyers. They streamline the process by showing homes that fit the wants and needs of a potential buyer.

If you are buying a home, it is much easier to deal with the bank, the seller, and the title company throughout the home purchase if you have an agent. Need a home inspection? Your realtor can provide you with a list. Want to view multiple homes in one day? Your realtor can get access. Realtors work for no charge until you buy a home, and they will tirelessly show you homes until you find the right fit.

Most importantly, real estate agencies abide by a code of ethics that includes social responsibility. Imagine a world not regulated by agencies such as the National Association of Realtors. Good luck avoiding misrepresentation of homes and corruption scandals.

Realtors are underappreciated, but you don’t have to buy a home through a realtor. There are many for-sale-by-owner options. But just like all other sales options, it is good to have professionals in the field that can streamline the process and create ethical boundaries.

Choosing the Right Agent

by Karen Picarello

When you are preparing to sell your home, one of the most important decisions you can make is the selection of the agent who will be helping you to close a deal on one of the largest transactions you will ever be a part of. They say that experience is the best teacher, but you don’t want to be saying “well I will do better next time” after selling a property. Most people will only do this a few times in their life, and it could be decades before you sell again. In the meantime, you will be living with the consequences. Particularly with how money compounds over time when invested, making an extra few thousand or tens of thousands of dollars earlier in life can make a massive difference later on.

Your real estate agent has three primary jobs. The first is to save you money. This means that they will be working to get the best possible offers for your property. You want to find an agent who will be able to assist in the transformation of the property to make it more marketable, and who will then know exactly how and where to advertise your specific property. An experienced real estate agent will be able to give you advice about where to spend your money to get the best possible value out of the sale. If you can invest a few thousand dollars before the sale with an expected return of ten thousand or more in the asking price, it will be absolutely worth it. Conversely, you don’t want to spend excessive amounts on expensive repairs or stylistic changes that will not change the property value very much.

The second job your agent has is to save you time. We understand that you are busy, you have plans, and would like to move on. Selling a property quickly yet for a fair price will require effective advertising and marketing. Choose an agent who has an active online presence, and who clearly understands how to market different properties effectively.

Finally, your agent is there to save you effort and hassle. There is a lot of paperwork to do when selling a property, and having someone who can walk you through the process will drastically change your perception of the experience. Knowing what will need to be signed and when not an intuitive part of the sale. A good agent will help you feel comfortable and keep you up to date on all of your paperwork.

Why RE/MAX?

by Karen Picarello

Trust Our Reputation, Count On Our Character!

The numbers prove it: RE/MAX agents continue to have leading productivity. 

RE/MAX associates once again outperformed agents with other real estate brands in the 2018 REAL Trends 500 survey. For the eighth consecutive year, RE/MAX agents in the survey on average outsold competing agents – averaging more than twice as many closed sales than agents at other participating brokerages.

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Avoiding Common Homeowner Pitfalls

by Karen Picarello

So, you found your dream home. The loan went through, you were approved, the move went smoothly (unlikely), and now you are settled in. Now what? The hard part is over, right? You have your dream home, now you just enjoy it for a few decades before maybe retiring and moving away. Dead wrong.

Your home will likely be the largest asset you ever own. Unless you are in a very small and wealthy subset of the population, this house will be one of the largest financial obligations you ever have. And while land and the housing market typically gains value over time, a smart homeowner understands that this increase in value will not come if the house is allowed to slowly fall apart. Unless some other factor makes the land suddenly incredibly valuable, your best bet when investing in your home is to take very good care of it.

Some of what will be needed in upkeeping a house will require a substantial financial commitment. The roof, the electrical system, and the HVAC systems will need to be maintained, and replaced periodically. Some of these will last longer than others, but all share a common trait. If you fail to keep them safe and functioning well, the rest of the property can quickly lose value. A leaky roof will cost more than just replacing it if it is ignored for a period of time. Water damage, mold, and other problems can quickly snowball, turning an already reasonably expensive process into a huge financial disaster. If you live in an area where it gets cold in the winter, failing to keep the house heated can lead to frozen pipes, potentially causing flooding and other damage when they thaw. A poorly maintained electrical system is a huge fire risk, and this is not only a financial, but a safety concern.

A smart homeowner will budget for all of these repairs, and put money away in years where repairs are not needed. Spending this excess on a new television might seem tempting, but the year you realize you need to replace the roof, the refrigerator, and redo the plumbing you will be happy that you had it saved away. Eventually, when you go to sell the house, having a record which shows your frequent maintenance will go a long way to convince potential buyers that this home will not end up costing them more than they expect, both in money and in headache. 

Timing Your Sale

by Karen Picarello


One challenging obstacle to people who own a house but are considering moving is the timing of their purchase. When looking to change homes, it is critical that your timing be correct. The two main factors in a sale are ensuring that you are not without a house for too long, and that you are able to get the funds from your old house in a timely manner. If you are unable to sell your old house, or end up struggling to buy a new one, you could end up in a sticky situation.

 

While it would be unpleasant to end up out of a home for a period of time, this is a better situation than having a home you are attempting to buy but being unable to sell your old one. Thankfully, there can be provisions in any contract which stipulate the contingency that your other plans go through. For this reason, it is recommended that you begin the process of finding a new home once you have listed the home that you own. Then, you can include clauses which stipulate that you must find a new home in x number of days in order for the sale to be completed.


This also gives you additional negotiating power when looking to purchase your new home. If you have the cash from the sale of your old home ready, you can use that fluidity to strengthen your offer. The reverse of this situation means that you will be desperate to close the sale on your old house, weakening your ability to negotiate for the highest price. So it is almost always best to list your old house before taking steps to purchase a new one. Once you are confident in the selling of your owned property, you can move forward easily and comfortably onto the purchase of a new property.

 

Additionally, it is important to have an idea of what the local housing market looks like. Understanding whether buyers or sellers have an advantage will help you to negotiate your contracts and plan your listings properly. In this situation, it is best to get professional advice from an experienced realtor. A strong understanding of the local housing market and current market conditions will put you in a much better position when negotiating. Therefore, before taking any steps, it is important to find an experienced realtor who will be able to guide you through the process.

 

Displaying blog entries 1-10 of 11

Contact Information

Photo of Team Picarello Real Estate
Team Picarello
RE/MAX Fine Properties North Scottsdale
21000 N. Pima Road, Suite 100
Scottsdale AZ 85255
Office: (480)860-8733
888-548-8713
Fax: (480)860-8755