Today we’ll be comparing the numbers from our January 2019 market to those of January 2018.

10,905 homes came on the market in January 2019, while 10,594 were listed in January 2018—an increase of 2.9%. We had 20,616 active listings this January, while there were 19,147 last year—a 7.7% increase.

5,466 homes sold this January compared to 6,208 last year—a 12% drop. The months’ supply of inventory increased from 3.08 last year to 3.77 this year.

The market is shifting toward a normal market. We’re leaving the times where you can put a sign in your yard and get five offers in a day. More homes will come on the market and listings will take longer to be sold. In fact, the Cromford Market Index peaked at 165 in August and is now at 131—a 20% decline over six months.

There are more buyers coming into the market because mortgage rates have dropped. If they continue to trend up, however, these buyers will likely back out again.

If you have any questions or need more information, feel free to reach out to me. I look forward to hearing from you soon.

The latest numbers are in for December 2018 and we’re excited to talk about the year-over-year changes we observed in our market at the end of last year.

Last December, we had 6,147 homes come on the market. That’s down 1.9% from the number we saw in December 2017. During the same time period, our active inventory rose 2.6%. We had 19,735 homes on the market in December 2017, but we had 20,249 homes on the market as of December 2018.

The number of homes sold in our market also dropped significantly. We had 6,503 sold homes in December 2018, down 9.7% from the 7,197 we saw in 2017. As for the months’ supply of inventory, that figure went up by 13.5% from 2.74 to 3.11 months.

It remains to be seen how January will play out, but we’re starting to note that buyer demand is in a steady decline from about 165 to 132 on the Cromford Market Index.

What does all of this mean? Buyer demand is cooling as interest rates have gone up. At the same time, buyer affordability has gone down because prices have gone up. The hot market we had in the early part of 2018 has gone away and we’ve transitioned back to a normal, flat market.

When it comes to supply and demand, we’re still technically more favorable for sellers, but we are trending towards a balance. One thing I just saw is that mortgage rates have come down to the lowest they’ve been in eight months and we’re currently sitting at around a 4.5% average. I expect to see more buyers come into the market because of this, as rates will go up again in 2019.

If you or anyone you know is looking to buy or sell a home in 2019, don’t hesitate to give me a call or send me an email today. I look forward to hearing from you soon.

Our market saw no real significant change in new listings: 8,521 new listings emerged in November 2018—in contrast, 8,554 came on the market last year.

There was a 2.8% increase in the active homes for sale from this year to last with 21,145 active home listed this year, and 20,564 listed in 2017.

Notably, our market underwent a 7.8% drop in homes sold from this year to last—6,644 were sold this year, while last year’s sales reached 7,202.

November’s inventory finished at 2.86 months last year and rose to 3.18 months this year, resulting in an 11.1% year-over-year increase.

So why the sharp increase in a few of these areas and the cooling off of sales?

These numbers appear to be symptoms of affordability becoming an issue for consumers, the ever-increasing interest and mortgage rates we’re seeing, and the fact that buyers aren’t qualifying for the homes they want to purchase or simply not qualifying altogether.  

This results in buyers feeling uneasy, which causes them to pass on purchasing.

The truth of the matter is if you bought a home between 2011 and 2017, you likely locked in a better rate than most buyers could get today—as it stands now, they’re sitting at 4.675%.

Though a number of reasons still make moving a necessity for some, we’re seeing fewer buyers electing to move at this time.

But this shouldn't totally discourage you: Homes that are priced right still have plenty of potential to sell.

For buyers, don’t wait to make a move until after the new year—you’ll want to capture the rate for that home you really want, now. If you don’t act, you may get “priced out.”

If you have any additional questions about the state of the market or any other real estate-related questions, please call or text me today at 602-738-9943. I’d be happy to assist you!

The real estate market is shifting, and it’s affecting agents as well as buyers and sellers.

As you’ve probably noticed, the market is slowing down. Right now, there are a lot of agents in the business, and the average agent sells about four or five homes a year. As interest rates continue to climb and the market continues to slow down, though, you'll notice more agents doing less business. Eventually, these agents will either leave the industry altogether or decide to join a team to help their business grow and increase their production.

At the Penrose Team, I’m always looking for talent—talent I can motivate and inspire to take the Penrose system, help as many people as possible buy and sell real estate, and give the best customer service possible.

So if you know of anyone here in Arizona looking to join a real estate team, give me a call or tell them to give me a call. I’d love the chance to meet and talk with them.

In the meantime, if you have any real estate questions yourself or you’re thinking of buying or selling a home, feel free to reach out to me as well. I look forward to hearing from you.

We’ll be discussing the recent changes we’ve been noticing in today’s market update for October.

We had 9,791 new listings this October, compared to 9,974 in October 2017—a 1.9% decrease. There were 19,889 homes on the market this October, a 3.1% decrease from 20,523 homes the same time last year.

Home sales are slightly down. We saw 7,340 sales in October 2018—a 1.2% decrease from 7,424 the year prior. We’re seeing 2.71 months’ worth of inventory this October, while we saw 2.76 months’ worth last year.

We’re seeing the highest mortgage rates since 2011, and the Fed is looking at hiking the rate again before the end of the year. We’re also noticing between 2,200 and 2,400 price reductions each week. This suggests we’re in a transitioning market where we have low inventory but also weakening demand. Higher rates mean buyers are having to pay more money for the same house. If you’re looking to move, it’s better to do it sooner rather than later so you can get a lower interest rate locked in.

If you or someone you know is looking to buy or sell, feel free to call me at 602-738-9943. I can also answer any questions you may have or provide you with further information. I look forward to hearing from you.

A lot of people tell me they don’t want to buy or sell during the holidays. They’ve got dinners to plan, and many have family coming to town to stay over. So that’s completely understandable.

But if you want to sell your home for top dollar, the fourth quarter is a great time to do so.

Why? A lot of sellers wait until after the holidays to put their homes on the market. By that time, there will be a lot more homes for sale than there are now, which means more competition. With more competition, sellers typically reduce prices to compete for the next buyer. The market in January tends to be softer, so why not sell now when there are fewer homes for sale?

Think about this: Any buyer who’s going to purchase a home during the holidays will have a sense of urgency. There aren’t a lot of homes on the market, so you’ll have the best opportunity to get a great price.

A buyer might also think that it’s better to wait until the new year to purchase a home since there will be more options. And that’s true; but we also know that interest rates have been rising consistently. They increased within the last few weeks, they’re also projecting another rate hike this year, and reports suggest that they might up another three times in 2019. Do you really want to risk a higher rate? A higher monthly payment?

I think it would be wiser to buy a home now and get your rate locked in as they are at the moment. You can always refinance if the rates go down in the future, but why finance at a higher rate then when you can secure a good one now?

If you have any questions or concerns, feel free to reach out to us. We’d love to talk strategy with you.

What’s the latest news from our Greater Phoenix area market? Here are the year-over-year numbers from September:

-The number of new listings decreased 5.2% from 9,646 to 9,145.

-The number of active listings decreased 5.5% from 19,832 to 18,754.

-The number of sold listings decreased 5.9% from 7,509 to 7,067.

-Our supply of inventory increased from 2.64 months to 2.65 months (though it’s increased 47% in the last four months)

In other market news, the Federal Reserve raised interest rates again this past week, and they’re expected to raise them one more time in 2018, up to three times in 2019, and once more in 2020. As interest rates rise, home affordability becomes a problem—a 1% increase in rates decreases homebuyers’ purchasing power by 10%.

If you have neighbors who’ve put their homes on the market, you might notice some of them reducing their price to get their property sold. This isn’t happening in all markets, but it’s starting to become a larger trend. In fact, we’re averaging 2,200 price reductions per week here in the Valley.

What does this mean for buyers and sellers?

If you’re thinking of buying, now would be a great time to do it. If you’re thinking about selling, now is also a great time to make your move so that you can lock in a great rate on your new home before they rise even higher. If you buy a home and rates drop, you can always refinance.

As always, if you have any other questions about our market or you’re thinking of buying or selling a home, don’t hesitate to reach out to me at (602) 738-9943. I’d love to help you.

It’s hard to believe, but fall has arrived.

With that in mind, many potential sellers are wondering whether their window of opportunity has passed for the year. Is it too late to list?

Actually, no. The fall is still a great time to put your home on the market.

Once Labor Day has passed, many sellers who previously had their properties listed during the summer will come back to the market for another try. So while those looking to sell now have another chance to do so, those thinking of buying should also seize this moment.

Inventory levels are about to increase due to this fall selling surge, but rates are also set to rise—at least two more times this year.

In other words, don’t delay. If you’re thinking of buying or selling in 2018, now is the time to make your move.

If you have any other questions or would like more information, feel free to give us a call or send us an email. We look forward to hearing from you soon.

Are we entering a buyer's market?

After several years of continuous price gains, the market seems to be reaching its price cap. In June, 14% of all listings saw price cuts. This is up from the low of 11.7% we saw at the end of 2016.

In the same month, housing demand fell 9.6%, which is the largest decline in over two years. And mortgage applications have decreased as well.

This is partially due to the decreased affordability we’ve seen lately, which has been the result of rising mortgage rates and home prices.

If this is the start of a buyer's market, it is unlikely to be a momentary blip. This is because home builder sentiment has fallen recently to its lowest point in nearly a year. Home builders are losing confidence due to affordability concerns.

What does this mean for you?

If you're looking to buy, it's great news because it means you will have more choices at affordable prices. On the other hand, if you're looking to sell, this may mean that it's time to act. Listing your home now would give you the best odds of achieving a top price before the change in the market occurs.

Remember that real estate markets are very local, so if you want specific information about a neighborhood, feel free to call us. We're always here to help.