There’s been a lot of talk in the media recently a housing crisis brewing. Here’s our May 2016 Maricopa County real estate update which will hopefully provide a more clear picture of what’s going on. Essentially, the perceived “crisis” boils down to a few things–one, demand in excess of available inventory and two, first-time home buyers sitting on the fence. Let’s look at the inventory issue as it relates to the market across Maricopa County. Our inventory levels remain below what would be considered a “balanced” inventory at approximately 21, 700 units–this is just slightly lower than last month. What’s important to note, especially for buyers searching right now, is that in some price ranges there is bountiful inventory. The hardest hit price range is the sub-$300K market. Across the board, there is a lack of high quality inventory priced under $300K–indeed, renovated, well-located homes under $300K are literally flying off the shelf. So, there really cannot be an issue with first-time home buyers if demand in this segment is strong–keep in mind though that if credit standards were more loose, we’d see even more first-timers enter the market. To illustrate how demand in the first-time buyer price range has changed recently, see the graph below which shows the Average Days on Market for homes priced from $200K to $300K–there’s been a decline across the board in the past three months, but a very sharp decline in the $200K to $300K price range.
This chart highlights some important data points about our current market:
Market activity should remain fairly strong for the next month and then we may see a slow down through the end of August in the $350K to $1M segment. First-time home buyers can expect competition through the summer when negotiating renovated, nicely located homes. Even with new TRID guidelines in place, our preferred lenders are closing home loans in 30 days or less. If you are considering a home purchase and need lender referrals, please contact us for options. Whether you want to buy or sell, one of our outstanding Luxe agents can help. Contact us day or night for the finest real estate representation in the industry. We hope that you have a safe and enjoyable summer.
