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Saturday, January 20, 2018

Valley Real Estate Report

House real estateAs we enter the last quarter of 2014, it is a good time to take a look at the Valley real estate market for 2014 in comparison to the last three years, and the important statistics that help us understand the market and predict the future. We will look at closed sales, the average sales price, the active sales analysis and the pending sales analysis. We’ll look at this from both the sellers and buyers standpoints. These statistics are important to consider in both buying and selling.

In July, the Phoenix metro area experienced a 6.24 percent decrease in the number of closed sales compared to June. There were 6,101 residential home sales in July compared to 6,507 in June. Last year in July there were 6,904 homes sold. This is substantially slower than last year. The number of transactions normally decreases historically during the last quarter of the year. The seasonal slowing and the drop in activity from last year, make it more important for sellers to price their homes to sell, and stage their homes to out shine the competition. The best looking and best-priced homes still sell in any market.

For buyers, it is still a great time to buy. Prices are low, relative to prices over the last decade and interest rates remain at an historic low. The inventory is good, providing many homes for buyers to choose from, and the condition of the homes are good because we are not seeing distressed short sales and foreclosures like the we had in the past years.

By Carlie Back

The average sales price of listed homes has decreased from $263,846 in June to $257,719 in July. This represents a decrease of 2.38 percent. Sellers, who are serious about selling, need to pay close attention to this, and price their homes aggressively to get them to sell. They also need to stage the home properly to show in better condition than the competition. When prices are falling, it is not the time to try to get more that market value for your home. Pricing needs to start at–or better yet–just below market value to get the home sold.

Buyers know that it is a competitive market for the homes that are in great condition and priced right. These homes sell fast with multiple offers quite often. When a buyer sees a home that has been on the market for a while in a declining market, they tend to under bid and hope the seller is now ready to lower their price.

When we talk about inventory, we are referring to the number of homes on the market that are available for sale. In the last five months, we have seen the inventory drop from one month to the next. There are fewer homes entering the market and this may indicate the market is shifting. A lower supply could lead to increasing prices, if the demand remains the same, or increases. There are predictions that we could see demand increase in early 2015, due to the large group of former homeowners that lost homes to foreclosure or short sale becoming eligible to qualify for a home loan again. Sellers should pay attention to inventory as it has a huge impact on prices and the time it takes for a home to sell.

This decrease in inventory means buyers have 535 less homes to choose from than last month. Buyers should pay attention to this because the fewer homes that are available on the market equates to more competition amongst the buyers out there looking. This increased competition drives prices up and makes it more important to act quickly when choosing a home or risk losing out to another buyer.

A pending sale is a home that has an accepted contract; however it has not closed escrow yet, or officially transferred to the new owner. For the fourth month in a row we have seen a drop in the number of pending sales in our market. The number of pending homes in June was 4,773, and dropped to 4,461 in July, a decrease of 6.99 percent. This is partially a seasonal drop, but is a good statistic to follow for sellers wanting to sell their home in a market where fewer homes are going under contract. This is the best stat to use to get the current condition of the market. It is the “pulse” of the market we are currently in. Buyers have an advantage in a market when less homes are going under contract. This may indicate less buyers are making the move and it may be easier to find motivated sellers that are not receiving offers.

While these statistics are seasonal and vary from market to market, and neighborhood to neighborhood, they are important to watch when you are thinking of buying or selling a home. Check with your real estate professional to help you determine what the stats are for your area and what strategy is best for your circumstance.

Contact the Carlie Back Team at (602) 305-9033.

 

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