May 2012 Update
April continued to be brisk. Continued shrinking inventory, but a slow up in activity, as expected, post Easter as a lot of folks headed back home for the summer. Still a lot of folks around, shopping, especially with the news touting the fact that prices are up 20%.
Let’s chat about that. I continually try to remind that it is important to look what is behind the numbers and that the numbers that are represented speak to the entire valley, not just Scottsdale or FH.
On the west side of PHX, homes that were selling at the peak that were priced at about $200k were being sold by banks, last fall, at around $35k to $70k. Those were inhaled by cash investors and anything that now comes on the market at under $100k has 30-40 offers on it within hours. The $200k home, that was selling for $35k is now selling for $100k+. The price tripled, skewing the valley wide %. A $35k house counts the same numerically as a $600k house.
In Scottsdale, a house that was selling at the peak for $440k was selling last Sept. for around $229-$239. Now, it is selling for around $269k to $279k. About 18% up, but still down from the peak a lot. Prices in Scottsdale are up 23% since last year, but still way down and still a great value.
People, when searching for housing search by price, so the above house is not going to sell for $390k, even if there is no inventory. Credit is tight – no matter what you are hearing. Lenders will dispute that, but unless you have near perfect credit, good luck getting a loan, especially from a major bank. They will do a preapproval, but won’t fund at closing.
One thing that will keep prices from going nuts is the fact that cash buyers are starting to pull back, opening up the market to those who need financing. Appraisals are historical and we are just now starting to see those values heading upwards, but they still lag behind the market. So that will keep prices somewhat level. We haven’t seen an offer come in that wasn’t all cash since last Dec. Now, we have had 2 in a row that are financed.
Again, sellers with unrealistic expectations are not going to sell. We are seeing properties coming on the market that are so over-priced that it is purely ridiculous. A right priced property has its first offer within 10 days of listing. All of the rest will just sit and smart agents won’t bother to even show. There is not a lot of room to haggle on a right priced home. The over-priced ones aren’t even worth the effort.
FH is still lagging behind Scotts in appreciation - although, there is virtually no inventory in condos under $150k. Single family homes are coming up, but the market there over $300k is still a bit behind.
The rental market has perked up dramatically for unfurnished. A lot of folks who have done short sales need a place to live until they can do credit repair. Seasonal rentals are starting to book up for the coming season. I would anticipate a banner year for seasonal rentals next year. Our inventory is at an all-time high. Please check out our web site. We should be booked solid within the next month or so.
Keep those referrals coming in and if you know anyone who is considering selling – call us NOW!!!! PLEASE!!!!
Happy Cinco de Mayo (or Cinco de drinko as it is called locally), Mother’s day, Victoria Day and Memorial Day.
Marty & Ellen
www.AlwaysOpenAZ.com
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