EARLY SIGNS OF MARKET CHANGES?
The real estate market has been like our valley’s summers – unrelentingly hot. The inventory of homes for sale is ridiculously low for a metro area of our size. The average number of available homes has been hanging in the 4100-4500 range. Silly numbers considering the Phoenix metro consists of around 4.5 million people. But finally we are seeing early signs of a market that is slowly shifting. When we say slowly, we mean slowly. What are the signs? At long last supply counts have stopped declining and in the 500K-800K price range active homes for sale have increased 40% since February. Before you celebrate (if you are a buyer) or panic (if you are a seller) we should note that we are still 69% lower than this time last year. Here is some insight offered by Tina Tamboer of the Cromford Report:
“Seasonally speaking, Greater Phoenix supply should be dropping at this time of year, not going flat or rising. When measures go against the season, it can be the beginning of a shift.”
“The reason this shift will not be noticed is because supply is still much lower than demand, so any slight increase in competition is inconsequential to a seller’s ability to secure a buyer, even one willing to pay over asking price. One of the early indicators that a market is shifting, however, is the number of list price reductions. For example, supply between $600K-$800K has risen 45% since late February; in the same time frame, the number of weekly price reductions increased 223% and hit the highest count taken in nearly 6 months. That’s notable. However in other price points where supply has flattened out, price reductions have remained low and stable.”
In short, not all price points are acting in unison. What you need to know to buy and sell are numbers and facts, not opinions or rumor. Tina further comments “The advantage in any market, not just housing, is being one of the first to know when things are shifting. Especially today, it’s a good idea to consult a Realtor® who can analyze your price point and area so you can make an informed decision regarding the sale of your home.” Sage advice. We are here to help and inform you. Please reach out to us with your specific concerns.
As always, we will continue to track the market. Have questions about your neighborhood? Contact us.
-Wendy And Russell Shaw