As we approach the end of the year, the Arizona real estate market is presenting a unique landscape influenced by recent elections and fluctuating mortgage rates. Surprisingly, these elections don’t significantly impact mortgage rates, making this an opportune time for buyers.
Despite rising mortgage rates, which have recently bounced back up to around 7%, the market is not experiencing a crash. Instead, we are seeing a massive supply of properties available, creating a favorable environment for buyers. Builders are offering attractive incentives, such as 4% financing and up to $10,000 in concessions, making it an appealing time to invest in real estate.
While some may view the current situation as concerning due to rising interest rates, it’s essential to recognize the potential for growth and opportunity. The appreciation rate per square foot has remained flat, indicating stability rather than decline. The contract ratio—comparing active listings to contracts—suggests that there is sufficient supply in the market.
Historically, the fourth quarter has always been the best time to buy in Arizona. Currently, the contract ratio is low, signaling a window of opportunity for motivated buyers. Even amidst predictions of an economic downturn and potential recession, employment rates remain strong, and the market shows signs of normal supply levels.
For sellers, it’s crucial to set reasonable prices and keep properties in great condition. Currently, there are 19,477 active listings on the market, which is relatively high. Properties that are well-maintained and priced competitively will attract more interest, especially as we move into the slower fall market, typically lasting around 45 days.
In conclusion, while there are challenges in the Arizona real estate market, significant opportunities exist for both buyers and sellers. With the right strategies, buyers can take advantage of favorable conditions, while sellers can still find success by pricing their homes appropriately and maintaining their property’s appeal. Always remember: negotiation is key in this market. Whether navigating low interest rates or high supply, being proactive and informed will serve you well in the months ahead.
Inflation has been slowly coming down, but we’re not quite at the Fed’s 2% target just yet. Right now, it sits at 2.7%—a big improvement from the high of 5.3% we saw early last year. While it’s good to see progress, it means the Fed may still need to make some moves to keep things on track. I’ll keep an eye on this trend and how it could impact our wallets in the coming months!
Builders aren’t oversupplying; they’re catching up. After years of building fewer homes, they’re now working to meet demand, especially following the 2008 slowdown. This helps balance the market without flooding it.
Seller concessions have risen significantly. In October 2024, 62% of closings included seller-paid concessions, compared to much lower percentages in previous years. This trend suggests sellers are increasingly willing to cover buyer costs to help close deals in the current market.
Homes are taking longer to go under contract. In October 2024, the median days on market reached 32, up from just 10 days a few years ago. This suggests a cooling market, where buyers may have more time to consider options before committing.
The real estate market in central and eastern Phoenix is highly competitive, with buyers facing strong competition for available homes. This is indicated by the higher contract ratios in these areas.
If you’re a buyer in these regions, be prepared to act quickly and potentially offer above asking price.
The number of homes going under contract in Phoenix is decreasing. This is indicated by the downward trend in the “Under Contract” line. This suggests a potential cooling of the market.
The Phoenix real estate market has seen significant fluctuations in recent years. There was a peak in activity during the 2019-2021 period, followed by a decline in 2022-2024.
This suggests that the market might be stabilizing after a period of rapid growth.
The average sales price per square foot in Phoenix has been increasing steadily over the past year, with a slight dip in recent months. This suggests that while prices are still high, they may be starting to level off.
Home prices in Phoenix have seen significant growth in recent years, especially during the pandemic. However, the pace of appreciation has slowed down in recent months, indicating a potential stabilization in the market.
The Phoenix real estate market is currently a mix of seller’s and buyer’s markets across different neighborhoods.
Areas like Chandler and Scottsdale are considered seller’s markets, meaning sellers have more leverage. Conversely, places like Anthem and Surprise are buyer’s markets, giving buyers more negotiating power.
If you’re looking to buy or sell, it’s important to consider the specific market conditions in the area you’re interested in.
The Phoenix real estate market is currently a mix of seller’s, buyer’s, and balanced markets across different neighborhoods.
Areas like Fountain Hills and Chandler are considered strong seller’s markets, while areas like Anthem and Surprise are buyer’s markets.
The current real estate market in Phoenix is leaning towards a buyer’s market. This is a rare occurrence, happening only twice in the last 10 years.
The Phoenix real estate market has experienced periods of both buyer’s and seller’s markets over the past few years. Currently, the market seems to be leaning towards a balanced state, with neither buyers nor sellers having a significant advantage.
The Phoenix real estate market is currently in a balanced state. This means that neither buyers nor sellers have a significant advantage, and the market is relatively stable.
Interest rates have decreased since April 2024, resulting in lower monthly mortgage payments. For example, on a $300,000 loan, the monthly payment has decreased by about $68.
Rents in Phoenix have been steadily increasing over the past few years, with a significant spike in February 2023. This indicates a strong rental market with high demand for rental properties.
If you’re a landlord, this is good news as you can potentially charge higher rents. If you’re a tenant, you may face higher rental costs.
The median price of a starter home in Phoenix has increased significantly over the past few years, peaking in October 2022. Since then, prices have started to decline, indicating a potential cooling of the market.
The median lease price for single-family homes in Phoenix has increased significantly over the past few years, especially between 2021 and 2022. This suggests a strong demand for rental properties in the area.
In many states, it’s currently cheaper to rent a home than to buy one in the short term. This is due to factors like rising home prices, interest rates, and property taxes.
If you’re considering buying a home, it’s important to weigh the long-term benefits of homeownership, such as building equity, against the short-term financial costs.
Mortgage rates have increased significantly over the past year. This means that borrowing money to buy a home has become more expensive.
The number of initial unemployment claims in the US has been fluctuating over the past year. There was a significant spike in claims during the early months of the pandemic, but since then, the numbers have generally decreased.
A decreasing trend in unemployment claims is a positive sign for the overall economy.
The spread between 30-year mortgage rates and 10-year Treasury yields has been fluctuating over the past few years. Currently, the spread is higher than its long-term average, suggesting that mortgage rates may still have room to decrease.
However, the future direction of mortgage rates will depend on various factors, including economic conditions and Federal Reserve policies.
The Greater Phoenix real estate market has shifted in favor of buyers over the past year. Several key metrics, such as median sales price, sales over asking price, and seller concessions, have improved for buyers.
If you’re a homebuyer in Phoenix, this is good news as you may have more negotiating power and better deal opportunities.
The Federal Reserve’s interest rate decisions can significantly impact the housing market. By raising or lowering interest rates, the Fed influences borrowing costs for mortgages, affecting housing affordability and demand.
Historically, 30-year mortgage rates tend to decrease during recessions. This is because the Federal Reserve often lowers interest rates to stimulate the economy during these periods. However, it’s important to note that this trend isn’t always consistent and can vary depending on various economic factors.
If you have any questions about your particular zip code, please reach out to me at jay@jaybrugroup.com or 480-466-4917
Jay Bru
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