Phoenix Real Estate Market Update 2012
Another month of Phoenix real estate home sales is behind us. How did we get along? The temperatures are beginning to rise in the valley of the sun. Are home prices? Let’s take a look.
As of today (June 3, 2012) there are 12,632 active listings. This excludes AWC status (Active With Contingency). This includes all types of home types, i.e. single family and condo to name two.
This number is relatively steady from last month. We are still seeing an approx. 2.5 months worth of inventory. Typically, under 4 months worth is considered a sellers market and over 6 months inventory is considered a buyers market. So, if you follow this wisdom, you would see it is a sellers market. We are seeing prices that support this. Sellers that are not in a distressed situation are tending to have higher list prices. Some we question whether their list price would be supported by a lenders appraiser.
Why is this significant? A buyer that will be obtaining a loan runs the risk of spending money performing inspections only to find out later the home does not appraise. They then have to make a choice. One, cancel the deal and loose the inspection costs, two, see if the seller is willing to reduce their price (which they are not obligated to do at all), three see if they can come up with the difference in funds and if the lender would allow it. Not a great place to put you the buyer in regardless of the solution.
However, it appears that many sellers not in distressed are willing to hold out for a cash buyer. This would remove the lender as an influencer in the deal. Cash is king as they say and it is one way the market makes larger jumps in pricing. A cash buyer can still have an appraisal done if the chose by the way.
When a home list price is closer to the sales of the last six months, we are seeing multiple offers. Buyers are being more savvy about how they are spending their money. Fewer buyers are unwilling to make larger jumps in their offer price. As a seller, you are faced with looking over offers that are close in price, but may have other aspects that help draw one to the top over the others. Cash is one example. Closing time is another. Obviously, net proceeds is very important too.
We are headed into our hot summer season where the market typically slows down. Since we are facing a 2.5 months worth of inventory it will be interesting to see if we actually do slow down. Condition of a home is key in a buyers selection, so take the number above and realize that a smaller number float to the top as in excellent condition and priced well. Those are the fast movers.
If you are a seller, be reasonable. Price your home well. Keep your home in good condition. Clear the clutter and you will have success more quickly. As a buyer, be savvy, be prepared with your loan approval (if you are getting a loan), act quickly.
How many homes sold last month alone? 98,122. Wow. We are on record pace there.
Are we in a turn around market? You decide. I invite you to come out with us and view some inventory. It may be an eye opener for you to realize things are moving more quickly than the typical news is reporting. If more sellers were realistic with there listing number I know we would have even greater sales numbers.
Stay tuned to see if June keeps pace. If it does keep pace through the hot season… that IS really saying something.
Till then.
Scottsdale, Phoenix real estate sales and purchases email: scott@scottsdalescott.com
Scott & Sandy Farmer, REALTORS®, GRI
Remember, when it comes to real estate: “It’s A Farmer’s Market”
Realty One Group, LLC, Scottsdale, Arizona>
ScottsdaleScott: Scott Farmer, Scottsdale Real Estate Home Sales
Scott Farmer ©2012 All rights reserved.
