Two Months Left to Our Peak Selling Season

Sellers:
We have two months left to our peak selling season before activity begins
to noticeably slow. If you have been on the fence about selling, now is
the time. Remember, “pretty homes” sell faster and for more
money…have your home in tip-top shape to secure the best offer(s)
from potential buyers.

Buyers:
Interest rates have remained stable (low) over the past 30 days. As
expected, active inventory dropped slightly this month making it more
competitive for buyers. Remember, you will often get a good price or
good terms (concessions/contingencies), but rarely both. Be prepared to
write your offer accordingly.

Posted on May 6, 2019 at 3:43 pm
Eric Karlene | Category: Uncategorized | Tagged , , , , , ,

Mortgage Payments Drop $50 per Month on a Median Priced Home

Mortgage Payments Drop $50 per Month on a Median Priced Home
Listings Under Contract Up 19% in 5 Weeks!

For Buyers:
Buyers got a break last month as 30-year mortgage rates dropped significantly from an average of 4.41% to 4.08%, which is the lowest they have been since January 2018.  On a $267,000 home (the median sales price in Greater Phoenix) the drop equated to nearly $50 per month in savings on principal and interest, which was enough to get many buyers off the couch and looking for homes.  This rate drop combined with an increased conventional loan limit up to $484K and a 32% increase in weekly seller price reductions meant that price ranges between $200K all the way up to $800K saw a combined 19% increase in contracts written over the last 5 weeks.  Contract activity is expected to increase at this time of year anyway due to seasonality, but last year over the same 5 weeks it only increased 8.6%.  For buyers who are still waiting for prices to begin declining, their wait just got longer.

For Sellers:
The drop in mortgage rates could not have come at a better time for sellers.  Up until 6 weeks ago the negotiating advantage sellers have been enjoying for years in Greater Phoenix had weakened to the point where the market was on track to enter balance within a matter of months and price appreciation would have begun to slow even more.  However by April 4th the average 30-year mortgage rate (as reported by Freddie Mac) had dropped to a 15-month low.  This spurred buyer activity and resulted in Listings Under Contract, which were 10.2% below 2018 last month, to sharply increase and surpass 2018’s April count by 0.8%.  Currently sales volume is down 9.6% from last April, however when these contracts close escrow over the next 4-6 weeks May and June should fare much better.  Don’t get too excited though, the seller market is still much weaker than last year.  Affordability and demand were helped by this interest rate drop but could quickly be negated as prices continue to rise.  Sellers still need to be mindful of their asking price to get under contract before buyer activity seasonally begins to decline between May and the end of the year.

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2019 Cromford Associates LLC and Tamboer Consulting LLC

Posted on April 12, 2019 at 5:06 pm
Eric Karlene | Category: Info, Market Updates - Cromford Reports | Tagged , , , ,

When is the Phoenix Housing Market Going to Slow Down?

 

  • Even though median prices are within 98% of the peak, the fact that interest rates are so much lower today means that homes are still affordable.
  • The median family income has risen $11,000 since 2005, indication there is room for families to bear the increase in price.
  • Despite appreciation rates higher than the rate of inflation over the past 7 years, families making the median income could afford 65% of what sold in Greater Phoenix last quarter.
  • Overall Greater Phoenix home prices have finally reached where they are supposed to be historically and it’s expected to continue rising through the end of 2018.

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2018 Cromford Associates LLC and Tamboer Consulting LLC

 

Posted on June 8, 2018 at 4:07 am
Eric Karlene | Category: Uncategorized | Tagged , , , , , , , , , , ,

May 2018 Market Report – Good time to List Luxury Properties

Supply between $175K-$200K dropped 18% in 3 Weeks
Summer is a good time to List Luxury Properties over $500K

For Buyers:
Supply under $200K has continued to drop rapidly, but the $175K-$200K range has accelerated its decline over the past month far more dramatically than any other price range. After being consistently 30-35% below last year, the active supply level dropped a whopping 18% in a 3-week period putting the current count for this group 44% below last year. Single family homes only make up 41% of active listings under $200K, but they account for 69% of actives between $175K-$200K. As more buyers are looking to condos and townhouses for affordable housing, supply for attached homes under $200K has dropped 33% over the last year. However, condo supply between $200K-$300K has actually risen 10% while single family homes in the same price point have dropped 15%.

For Sellers:
We are officially at the peak of the market seasonally for listings in escrow. Over the next few weeks, especially as temperatures reach over 100 degrees in the Valley, expect to see a gradual decline in buyer contracts that will continue through the end of the year. This is a seasonal trend that consistently happens every year and in every price point, even the frenzy market under $200K. The one exception is the luxury market over $500K. While it’s typical to see a decline at the beginning of Summer like everyone else, escrow counts tend to drop for a couple months and then go flat until the end of the year. In fact, luxury supply drops more than buyer activity does in the Summer making it a great time to list luxury property for those willing to brave the heat between June and September.

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2018 Cromford Associates LLC and Tamboer Consulting LLC

Posted on May 15, 2018 at 10:11 pm
Eric Karlene | Category: Market Updates - Cromford Reports | Tagged , , , , , , , , , , , ,

April 2018 Market Update – MLS Sales Outperform non-MLS Sales in Frenzy Market

MLS Sales Outperform non-MLS Sales in Frenzy Market
Supply Under $200K Down 36% Over Last Year

For Buyers:
Greater Phoenix ended the 1st Quarter 13% lower in supply, which was not helped by a 2% decline in new listings entering the market. All price ranges are below last year’s level of supply with the exception of the $1M+ market, which is up 1.5%. On the opposite end of the spectrum, supply under $200K is down 36% from last year and all prices in between are down 10%. Buyer competition is typically at it’s strongest at this time of year and is expected to begin tapering off seasonally in May or June.

For Sellers:
Despite the highly competitive, fast appreciating environment in the $100K-$200K market, more sellers decided not to list their home on the MLS and many chose to sell to an investor instead. This is ironic considering MLS sales in that price range sell for 12% more per square foot on average compared to normal non-MLS sales, which could equate to a $12,000-$22,000 gap. Additionally, the annual average sales price per square foot rose faster for MLS sales in this range at 7.9% while non-MLS sales rose only 6.0% over the last year.

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2018 Cromford Associates LLC and Tamboer Consulting LLC

Posted on April 12, 2018 at 8:53 pm
Eric Karlene | Category: Market Updates - Cromford Reports | Tagged , , , , , ,

March 2018 Market Update – Median Sale Price up $20,000 over March 2017

 

Median Sale Price up $20,000 over March 2017
17% of Sales are Closing Over Asking Price

For Buyers:
The percentage of seller concessions awarded to buyers has dropped down to 24% in the first quarter of 2018 after 2.5 years of consistently landing between 26%-28%, yet another indicator of dwindling buyer negotiating power in a prolonged supply shortage. The highest percentage of closings with seller concessions in the last 30 days were sale prices between $150K-$250K at 30-36%. Buyers were most likely to get closing costs in Youngtown at 54%, followed by Buckeye at 52%. Cities with the smallest percentage of closing costs were in affluent and retirement areas such as Paradise Valley, Sun City West and Sun Lakes at 2-3%.

For Sellers:
The percentage of successful sales over asking price is increasing. So far in March, 17% of sales closed over list price, last March it was 14%. Properties sold between $100K-$200K had the highest percentage at 24%, followed by the $200K-$300K range at 18%. The market between $300K-$1M is the most improved with 12% sold over list compared to only 7% last March. There were zero sales over list in the market over $1M. Areas with the highest percentage are El Mirage and Youngtown, both at 50%, followed by Tolleson with 45.5% of sales closing over asking price.

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2018 Cromford Associates LLC and Tamboer Consulting LLC

Posted on March 16, 2018 at 4:41 pm
Eric Karlene | Category: Market Updates - Cromford Reports | Tagged , , , , , , , , ,

January 2018 Market Update – Cromford Report

 

2017 MLS Sales up 6% over 2016
Over 50% of 2017 Sales Were in this Price Range….

For Buyers:
2018 is not going to be any less competitive for buyers in general. The market is starting out with 14% fewer listings compared to 2017, however there are 35% fewer listings under $200K, a price range that commands 34% market share of all MLS resales in Greater Phoenix. 51% of MLS sales were between $200K-$400K in 2017, and supply in this range is down just 7%. 14% of sales were between $400-$1M and supply is down nearly 9%. Only the market over $1M is starting 2018 with 4% more for sale, 2017 sales over $1M were less than 2% of the market.

For Sellers:
Over 51% of newly constructed condominiums, townhomes and single family residences sold in 2017 were between $275K-$500K as of November and approved single family permits are up nearly 12% going into 2018. Added inventory from new construction continues to keep mid-range property appreciation at sustainable levels at the current level of demand. The last wave of boomerang buyers are expected to rejoin the masses in home ownership this year after waiting 7 long years to qualify for conventional financing after foreclosure. These buyers span all price ranges and their return combined with positive inbound relocation and employment keep Greater Phoenix a positive environment for sellers.

Commentary written by Tina Tamboer, Senior Real Estate Analyst with The Cromford Report
©2018 Cromford Associates LLC and Tamboer Consulting LLC

Posted on January 21, 2018 at 12:00 am
Eric Karlene | Category: Market Updates - Cromford Reports | Tagged , , , ,