As a full time Real Estate agent in the east valley, everyone always ask you “how is the market?”
Right now my answer is Weird! That is the only way I can describe it. As of recent it seems that the lack of inventory has had a bit of an opposite effect. Last year low inventory was a driving factor in rising prices and higher demand. The way it seems today home buyers are being a lot more picky than they have been in the last few years. We are seeing more modest gains in value or even a small down tick. Homes that need work or lack updates are sitting on the market longer. The rising interest rates are not helping the cause much either. Out in San Tan Valley for example, it was pretty easy to find homes in the $200,000 or less price range. Now in order to do that you are looking at homes that need work or homes that are further out on the fringes of town. I feel that the $200,000 and under segment of inventory is the most underserved right now.
So this brings me to the health of the market. In my twenty years working in corporate America I learned a few things. One of those is data is king. So if you really want to know how the market is doing, ask a builder. I mean that metaphorically because the builders will alway tell you that they are killing it! They are selling homes like hotcakes. The real story is in the incentives. Lately I have seen builders throwing in a lot more extras than they have been in recent years. For Example I got an email this week from DR Horton in Copper Basin offering appliances, backyard landscaping, closing cost, and a $1,000 bonus for the agent that brings a buyer. Meritage Homes at Quail Run is offering similar incentives.
In my opinion most builders spend a ton of money on marketing and they have all the local and national sales data, as well as their own mortgage divisions. They are really in the know as far as the market goes. If they are softening up on price and commission, you know the market is slowing down. Only time will tell how high interest rates are going. A recent CNBC article seems to think the fed is going to drive us back into a recession. Some experts think we may see rates as high as 7%-8% before too long.
Keep in mind that market conditions can be hyper local. So take articles about the national housing market with a grain of salt. For example we don’t always see a huge slow down the the winter here like the northern states do. So my best advice is if you want to know how the local market is doing, give me a call. I’m always happy to grab some lunch with you and talk shop.