Latest numbers for Friday 5/25/2012 (All Maricopa County, AZ)
- Active: 10,014 (-40.3% from 2/21/12)
- Active (Single-Family): 7,794 (-40.3% from 2/21/12)
- AWC/Pending (Single-Family Under Contract): 15,711 (-8.2% from 2/21/12)
- Active (Condo/Patio Home/Townhome/Loft): 1,693 (-32.5% from 2/21/12)
The Bottom Line: There are 102% more Single Family homes under contract than actively listed in Maricopa County! There is more demand than supply if you look at this on a broad (macro) county level. On a micro level the ratio of supply and demand varies with factors like Location & Price. Note the decrease in pending home sales- this is a large indicator of what is happening in our market place and is affected by things like seasonality (hey- it's getting hot here!).
This also signals that perhaps the buying spree many investors had been on may be coming to an end. ***INVESTORS: Beware, your returns are likely going to start shrinking. Be very careful as you calculate your ROI when adding to your income property portfolios. As inventory whittles away and prices rise, the HUGE profits they were banking on may not be there, making rental income properties in their investment portfolio less attractive. Alarm bells should be going off now because this is the point that the smart investors/speculators stepped out buying during the housing boom. It was those late to jump on the band wagon who got burned- bad.
***BUYERS: pay attention here- this may signal a green light for those of you fed up of getting beat out by investors' cash offers. Because the rate at which homes are being gobbled up could go down, if investors segue out of the buying pool, that means you could have less competition. Now, there are only 492 single-family homes in all of Maricopa County under $100,000. This looks a little better if you're willing to add all other kinds of homes to the mix- 1,344. As this number shrinks away, it will put a lot of entry buyers out of the buying pool.
On the flip side, the median home price is rising. ***SELLERS: pay attention here- if you bought in 2004 or earlier OR bought in 2009 or later you are in a good position. You bought before the market peaked and after it spiraled downward. There is a very good chance that you have equity in your homes, enough to sell without having to sell short (do a short sale). Perhaps if you've been waiting to sell to move out of state, down-size or move up, now might be the time.
Going back to BUYERS, because interest rates are even lower than they were before (still baffling to me...) you have even more buying power. A buyer I started working with earlier this year was looking at a 4.25-4.5% interest rate with 5% down, which would have capped her out at $110,000. Now because rates have dropped into the 3.75-3.875% range, her new limit is about $125,000.
Want to get even more granular? Consider these stats:
- There are only 60 homes listed in Scottsdale under $100,000
- There are 250 single-family homes listed in Scottsdale under $250,000, but only 49 have 3BR or more
- There are 281 single-family homes listed in the town of Paradise Valley, but the least expensive single-family in TPV (Proper) will cost you- $625,000
- There are 223 single-family homes listed in Phoenix under $100,000
The really big picture: We've gobbled up most of the inventory that distressed our market at a housing market peak of 58,195 in November 2011 and we're not too far off from the low point of inventory at the peak of the boom of 8,611 in March 2005. Keep your chin up- the light at the end of the looooong tunnel is shining brightly.
Please contact me directly for more details as they relate to your needs and your area. TGIF!!