2013 has arrived!
With 2012 now part of the past, we turn to the brand New Year. Since early 2007, it has seemed that the New Year usually didn’t promise better news than the previous year. Real estate has been much the same…until now! Experts are more optimistic than in years past that whatever the year brings, one way or another, the Phoenix real estate market is in MUCH better shape than most of the country in our recovery. That is EXCELLENT NEWS!
As previously reported, supply and demand are the key factors in all of this. Right around mid-summer of 2012, supply began to slowly build after a very busy buying frenzy in the first part of the year. Now as we begin 2013, supply has increased dramatically in some areas while simply building up in others. Amazing what a few months can do to improve a market. Some of the outlying communities (Gilbert, Maricopa, Avondale, Litchfield Park, etc) have seen a significant rise in homes for sale accompanied by a very sharp drop in demand. For example, in the town of Maricopa - supply is about 4 times higher than mid-2012 and demand has dropped in half.
In short - Maricopa is currently a strong buyer's market. Some interior areas (i.e., Scottsdale, North Central Phoenix) are seeing rises in inventory as well, although less dramatic ones, which means a balanced market has occurred or soon will through most areas. Builders are contributing to new supply after years of little to no building which is helping this shift as well. Demand is dropping largely due to investors losing their appetite. So while 2012 was a seller's market, we expect to see 2013 be a balanced market tipping into a buyer's market.
One interesting change to the market is that many sales are not occurring through MLS. Builder sales, trustee sales, “pocket listings” (non-MLS sales) and private sales are composing anywhere from 20-30% of the sales NOT reported in the MLS.
Short sales - a significant component of the market for the last few years, have dropped dramatically - in fact they are down at a level not seen since February 2011. REO's (bank homed homes) are staying in low levels and we hope to see them dwindle by the end of 2013, such that they become an irrelevant factor. The ongoing media reports of huge looming levels of "shadow inventory" have been proven to be a case of crying wolf.
The local real estate future still hinges, as all areas do, on the overall economy, consumer confidence and our government fiscal challenges. What impact that will have is anyone's guess. No matter, experts continue to feel very optimistic that the first half of 2013 should be a healthy one in the Phoenix real estate market. There is reason to celebrate the arrival of a New Year.
If you are thinking about selling your home, allow me the opportunity to provide you with a market anaylisis to help you determine if NOW is the time. This is free knowledge I am happy to share. Call or email me any time (480-239-3023 or john.groves@azmoves.com).
As a potential Buyer in this market, and depending on where you would like to “set down roots”, there are plenty of homes available – particularly in our top school districts which are an important factor many forget ADDS to your resale value.
My very best to you for a bright and prosperous 2013. We all have much to be grateful for.
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