Phoenix Market update 2020

What’s going on with the Phoenix real
estate market in 2020? that’s the topic of this video and we’re going to talk
about buyer bidding wars and I’m going to try to answer the question where are
all the houses. Let’s get started Hi I’m Amy Hayslett, I’m a REALTOR® here in
Phoenix Arizona and today we’re talking about the Phoenix housing market 2020.
The numbers are in and 2019 was a great year with a lot of momentum going into
the end of the year and we had very low inventory at the end of the year. Now,
typically this time of year after the holidays and at the beginning of the
year we tend to pick up with inventory We are just not seeing that right now. Iin
fact I was going into some numbers the other day for my own neighborhood of
Verrado to see what was out there and I was really surprised how little
inventory of homes are on the market. Currently if you look at the numbers for
Verrado there’s actually more homes under contract than there are for sale and
that’s just not something you see. So in checking the numbers we had 40 homes
listed for sale in Verrado and 51 under contract. At that rate we’re gonna run
out of homes to sell people and I can remember a year and a half ago when I
was saying we only had 70 homes listed in the neighborhood and now we’re down
to 40. That’s just crazy! Let’s look at a few other neighborhoods so
that you can see just how low amount of supply we have. Garden Lakes in Avondale
for example has 12 homes on the market for sale and 19 under contract waiting
to close escrow. Marley Park in Surprise has 22 homes listed for sale and 19
under contract. Estrella in Goodyear has 70 homes listed for sale and 63
under contract. So you can see by those local numbers and neighborhoods there
are not a lot of homes on the market right now. Supply is low everywhere. Let’s
start looking at the Phoenix numbers as reported by the Arizona Multiple Listing
Service. With inventory so low, let’s start by
looking at supply and then move to demand . So we ended last year 2019
already with a low amount of homes on the market. We had 14,942 homes and again
generally after the holidays January and February we start to pick up. So where
are we at with those numbers. Today we have $14,655 homes on the market currently today. So that number has actually gotten
even lower than it was at the end of the year and when you compare that number to
last year it’s even more astounding because we’re down 27%
from last year year-to-date when the number was twenty thousand one
hundred ninety nine homes on the market for sale. Now let’s take a look at the
numbers for demand and we’ve already touched in other videos on how we’re in
an area of growth. Maricopa County’s the fastest growing County in the country.
Phoenix has been the fastest growing city in the country by units and the
city of Buckeye on the west side has been the fastest growing city in terms
of percentage in the country. So you guessed it demand is up. So let’s look at
the numbers last year at this time we had 5471 homes that sold in January of 2019 compared to this year when we came in at
9701. That’s up over 77% So supply is down and
demand is up and we all know from economics what that means. Let’s talk
about how that’s impacting sales and take a look at pricing next. So with all
this low supply and high demand of course we can expect prices to go up but
how much. In January 2020 the median price was $290,000. Let’s take a look at January of 2019 it $263K which is a 10% increase from last year.
And with low supply and high demand you can also expect that homes are going to
be selling faster. Days on market in January have gone down from 2019 when
they were 72 to 63 in 2020. So homes are selling faster. Now let’s
take a look at months of inventory. At the end of the year we were really low
with 2.53 months of inventory to end the year of
2019. Here in January 2020 we are at 1.7 months of inventory
and last year in January we were also at 2.53 months of inventory
just like we ended the year. So that’s down over 30 percent from our inventory
levels of last year. So what’s behind the low supply of homes right now? Well
demand is one of the reasons. Phoenix as we’ve said before is growing like crazy
so we’re getting a lot of new people coming into the area. Also interest rates
remain low so that gives buyers a reason to buy but on the other end of it is
supply and there’s really a couple of factors that are happening in the market
right now. Number one the builders are just behind
in their production they haven’t been building as many homes as they’ve done
so in the past and the other thing is people are holding on to their homes
longer especially boomers who are looking to retire and downsize. In many
cases owners are locked into really low interest rates so even if they’re
downsizing in terms of square footage their payment may not be lower and in
some cases it might go higher if they decide to sell and buy another home. So
those are some of the dynamics that are happening in the market today. What does
this mean for buyers and sellers? Well again buyers are going to have a
really tough time finding homes and they’re gonna have to start looking at
the option of building new. In fact I was out looking with some folks the
other day and in some cases buying new is less expensive than some of the
resale homes out there. Now that’s not always going to be the case in most
cases you’re going to spend a little bit more on new builds and you may have to
wait longer for it to be built and interest rates could go up in that
timeframe. So these are all things to consider but if you’re looking to buy a
home and especially a resale home you want to go out and see that house the
day it goes on market and you want to be ready to put that offer in right after
you see it. That’s how competitive things are right
now. Sellers on the other hand it’s a great time to sell. Prices are up and
homes are moving quickly so if you price your home right and it looks great it
should sell right away. The biggest challenge is going to be for those
sellers who are looking for their next home and the other challenge might be
appraisals because buyers are willing to push prices up right now with bidding
wars so there’s a better chance that an appraisal might come in low. We’re just
not seeing the comps even 30 days ago that are supporting prices that we’re
seeing now so hopefully you get an appraiser that looks at the fact that
the market is going up and factors that in. But when the markets going up as quickly
as it has been these last 30 days or so you do see more appraisals coming in
low but you can look at it as that’s kind of a good problem to have because
at least you’re getting a higher price than you were before
and hopefully that home is going to appraise. Even if it comes in a little
bit lower chances are you’re getting more money for your home than you may
have gotten if you had put it on at the end of the market in 2019. So that’s my
market update for January and February of 2020. I’ll see you on the next video
over here. Take care. bye bye!

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