Well, there’s no doubt about it, we’re in a Buyer’s Market and for the short term it will continue, but it’s not all that bad.
First of all, the facts: home sales of all types in the Phoenix Metro area are at their lowest level since August of 2009 – almost 5 years ago, indicating a huge drop in demand.
Second, there are more homes on the market now than there have been since June of 2011 – almost 3 years ago. We currently have 30,506 homes listed for sale, which is up from only 20,061 one year ago – a 52% increase in just one year.
We currently have a 4.6 month supply of total inventory, which is not that bad historically, and probably close to what we had in the early 2000’s. When compared to last couple of years however, it does not look to snappy, since it the highest level since May of 2011. But consider this, when comparing the amount of inventory to February of 2008, you’d find that we had 20.4 months of supply. Essentially, when looking at the short term, it looks a little grim, but when you stand back and look at the history of Real Estate and what a normal market should look like… We can say we’re doing alight!
Third, homes that are in currently in escrow have dropped 30% when compared to this time last year. It went from 11,502 to just 8,022. Most of us agree that this is due mostly to the investors have left Arizona for other parts of the country. In a way, that’s okay as they were the bottom feeders anyway.
And lastly, there is a huge disparity between the average price per square foot ($177 PSF) of homes on the market now to the prices that others are actually selling at ($135). Clearly many of the homes listed will need to drop in price if they want to be competitive in this buyer’s market.
There is however positive news in our market! The amount of homes currently in foreclosure is at its lowest level in 7 years, that’s right March of 2007 to be more precise.
Also, mortgage rates continue to hold their own, which most predict will not last very long, especially if the macro economy continues to improve.
So buyers, it’s time to get off the fence. There’s a good supply and low mortgage rates! Give us a call. 602-689-3100.