Winds of Change in the Phoenix Metro Real Estate Market

Have you felt it?  If you’re selling a home in the Phoenix metro area, you probably have.  Buyer activity on your home for sale has declined.  You may not have had any showings in a week or more.

The Phoenix metro real estate market has changed

What happened?  Your neighbors sold their home in a day.  Your home is nicer and it’s just sitting there.  Must be your agent, right?  WRONG!

A report just released from the Cromford Report, the folks who bring us everything you’d could ever want to know about the Phoenix area real estate market, is eye-opening and unfortunately, it’s news no seller wants to hear.

Our inventory has increased and we now seem to have more listings than buyers in many communities.  It’s not that we’re seeing a dramatic increase in the number of new listings, it’s really a decline in buyer activity.  Homes are sitting and new homes are being added.  Voila! A supply/demand issue has just been created.

Phoenix area real estateWhere did all the buyers go?

Rising prices, unstable interest rates, faltering economy and government issues that have everyone on edge may all be combined to create fear in buyers. Buyers who may be taking a sit back and wait stance.

Demand for homes in the Phoenix area has collapsed

Areas hardest hit are Anthem, Tempe, Mesa, Gilbert, Chandler, Glendale, Tolleson, Fountain Hills & El Mirage.  In these areas we are seeing multiple price reductions as sellers start to panic.  Price reductions, as we know, are a slippery slope. Your neighbor reduces so you reduce a little  more.  A week later your neighbor reduces again to below your price… you get the picture.

While this is not the best news for sellers, buyers have more homes to choose from and are finding their offers being taken seriously unless the seller is misinformed about current market conditions and thinks they are still in the driver’s seat.

If you are selling a home in Sun Lakes or Sun City West there’s good news

Despite what’s happening in the Valley, Sun Lakes & Sun City West are seeing good buyer activity and home values are rising steadily.  Why?  I’ve been talking about this for some time.

These are active adult communities and they typically follow Valley real estate market trends by about 16-18 months.  While Valley prices were plummeting early on, these active adult communities were still seeing their home values rise.  When the market picked up in the Valley, Sun Lakes and Sun City West values were still falling.

If history repeats itself, Sun Lakes & Sun City West should continue to see their values rise at a pretty good clip for another year or so if inventory remains low.

Does your agent know what’s happening and are you listening?

Understanding current market conditions is one of the most powerful tools your agent should possess.  But are you listening?  Sellers who think they know what’s happening because their neighbor, brother or Uncle Joe told them so, are not going to be successful with their home sale. We are returning to the time of “What you need to get” and  what the market will bear is more important than ever.  If you’re agent is presenting you with the market conditions data (we can’t make this stuff up!) you must trust that information.

It should also be noted that homes priced under $200,000 are still attracting a lot of interest.  With this knowledge, I just listed a home at $199,000 The seller wanted to list for $210,000, but I knew where we needed to be to get the most attention.  We received 12 offers within 24 hours that drove the price up to $215,000.  Agents who understand current market conditions are the best weapon a seller can have right now as proper pricing is key.

Here’s a chart from the Cromford Report which illustrates by city how many sales, pending and active listings there are compared with the same time in October 2012.

October 10, 2013


City Pending % Change Sales per Month % Change Active Listings % Change (excluding UCB)
Phoenix -33% -6% +52%
Mesa -39% -14% +51%
Scottsdale -30% -11% +25%
Chandler -39% -8% +67%
Glendale -34% -17% +61%
Gilbert -35% -11% +76%
Surprise -41% -10% +22%
Peoria -34% -4% +57%
Queen Creek -41% +2% +17%
Avondale -36% -14% +49%
Tempe -55% -11% +80%
Goodyear -33% +5% +18%
Maricopa -32% -8% +13%
Buckeye -25% +4% +26%
Sun City -21% +26% +43%
El Mirage -41% -25% +122%
Casa Grande -44% -7% +52%
Apache Junction -55% +12% +5%
Anthem -60% -37% +31%
Laveen -50% -7% +130%
Cave Creek -18% +23% +61%
Sun City West -20% +12% -4%
Litchfield Park -43% -13% +20%
Fountain Hills -52% -28% +26%
Tolleson -43% -32% +115%
Arizona City +16% +77% +1%
Sun Lakes +6% -26% -29%
Paradise Valley -29% -14% +14%
Gold Canyon -65% +32% +27%


 

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About The Amy Jones Group

Mindy Jones Nevarez is the owner of Amy Jones Group Keller Williams Integrity First. The Amy Jones Real Estate Group has been recognized as the #1 Real Estate Team in Chandler by the Phoenix Business Journal and voted Best of Our Valley for 4 years.

The Amy Jones Group specializes in real estate in Chandler, Sun Lakes, Gilbert, Mesa, Tempe, Ahwatukee, and Phoenix.