By Frank May
We made it to December, in what some would call the most extended year to date. This year started strong with the market well balanced for both buyers and sellers. By March, everything started to change. COVID-19 was taking over our everyday lives and our thoughts were that this would only last a few weeks. Fast forward to November, and we saw an election that was fraught with more division between parties and people in decades. What a year!
How did 2020 affect the value of your home? There was a lot of talk going around right as the lockdown started that the housing market would be hit hard like 2007. The naysayers were wrong and right. It was hit hard. Hard with appreciation. Hard with multiple offers and buyers offering thousands more than the list price. Listing agents had a tough time trying to figure out what to price the home as each week it seemed to increase over the previous. The graph below shows appreciation in 85383 over last year. We see an 11% increase in home values over the prior year.
Here’s another graph showing the median home price in 85383 over last year.
Last year, the median home price was less than $385,000, with median home sales this year reaching $425,000. An average of $40,000 increase year over year. Just for owning a home in 2020! I always try to find a silver lining in life, but this is beyond what I could have hoped for with everything else happening in 2020.
What is driving the home prices up? Inventory is the leading cause of price increases. As we shifted this year from a balanced market to a seller’s market, housing prices dramatically increased. Since COVID-19 happened in March, we saw a decline in listing inventory Valley-wide.
We currently have only 145 active listings in 85383 as of writing this article. Valley-wide we have just over 8,000 active listings. In March, we had over 13,000 active listings! That is 5,000 fewer homes to choose from in the Valley, creating a significant difference in buyers’ options, giving sellers a leg up during negotiations and ultimately getting what they are looking for when they sell their home.
Do I think this will continue into 2021 and beyond? I don’t have a crystal ball. What I can say is that with inventory continuing to be scarce and interest rates continuing to stay at an all-time low, we should see this trend continue into the coming year. It is a great time to sell, and I would love to talk with you about what it might look like for you. Give me a call if you want to talk at 623-203-1800.
Frank May grew up in the Valley, graduating from Northwest Christian School and NAU. He is a real estate agent with Keller Williams Realty and has been helping both buyers and sellers for 18 years. Frank May is also a Dave Ramsey Endorsed Local Provider.