Everyone wants to know which way Arizona home sales are trending. Will they continue up, go flat or drop off a little? No one knows with 100% certainty. If anyone did, I believe they would take their crystal ball and play the stock market or the lottery.
We can only speculate based on market analysis and statistics shooting for probable outcomes. I personally believe home prices will continue to rise due to basic economics of supply and demand. However, there are some nuances in the market but home prices will continue up in the short term despite them.
Here are some reasons why AZ home sales prices should continue up:
- #1 Reason: Lower inventory throughout the Phoenix Metro real estate market. The number of homes for sale dropped 8.5% in Feb, 2013 compared to a year ago. There are only 17,145 active homes for sale as of Feb, 2013 compared to almost 60,000 in the height of the foreclosure dilemma just a few years ago. This is a good time to sell your home for top dollar if you’ve been waiting for a recovery.
- Distressed sales (foreclosures & short sales) currently make up only 28.8% of total home sales compared to 74.1% in Oct, 2010. This trend will continue down because the number of pending foreclosures continues to drop. Simply put, homeowners are able to pay their mortgage payments.
- Home prices of $0 – $150,000 are pretty much gone especially in Chandler, Gilbert and other desirable areas. This causes the entry level home buyer to jump up into the $200,000 range immediately forcing home prices up. Low interest rates are affording these price jumps but personal income levels won’t be able to sustain it. This is why it is still a good time to buy right now for most people.
Based on fundamental supply and demand principles, Arizona home sales prices should continue trending up. Please consider me when buying or selling your next home. I have been serving the Chandler, Gilbert, Mesa, Tempe and Phoenix Metro real estate markets for over 20 years. Please leave a comment below should you have input or an opinion on the AZ real estate trend for home sales prices.