By Frank May, Real Estate Agent
As kids are going back to school, we usually see an increase in inventory, as less people want to make a move if they just put their kids in school. This year isn’t disappointing, as we have risen from around 16,500 last month to 18,900 today.
According to real estate experts, Altos Research, the national increase in listings is slowing and they think we are in for an even softer landing than they thought just a couple of months ago. This is great news, and locally we are following that same path, as our increase is slower than it was.
We are still expecting the Fed to raise rates, which doesn’t correlate one to one with mortgage rates, but it does affect them. So, we should see the mortgage rates increase again before the end of the year. We just don’t know how much higher that will be.
Speaking of interest rates, we are seeing an increase of our sellers offering the incentive of buying down the interest rate for the buyer of their home. It is a great way of helping the buyer get the payment they were looking for and it helps us get the seller’s home sold. It’s a great win/win!
Locally in 85383 we have seen a small increase in inventory going from 322 a couple of weeks ago to 326 today. The number of homes under contract seemed to bottom out about a month ago at 316 and today we are at 326. It’s not a big increase but it is going in the right direction!
Regarding prices, I am seeing a lot of price reductions. Some of this is because sellers are still looking at what homes were selling for a couple of months ago and thinking they can get the same price. They can’t. And, if they want to get their home sold, they need to be in the right price range. Buyers just aren’t over-paying right now, and if prices keep dropping you can find yourself chasing the right price and missing out on getting the highest price for your home.
I saw this back in 2007-2008. Sellers who were priced $25,000 over what similar homes were selling for would wait too long to lower their price and by that time the prices had dropped another $25,000. They would sit on the market too long again before lowering and again, the prices had already dropped another $25,000. To be clear, I’m not seeing prices drop like they did back in 2007-2008, but if it needs to be $10,000 lower, you could end up making more if you get to the spot where the buyers are buying before everyone else does.
The other thing that is important is getting your house as perfect as possible before selling. There is a balance here between getting it ready and taking too much time to get it on the market. There is a sense of urgency to get your home on sooner than later, so if something needs to be done, start getting it done now. If you need referrals to someone, please let me know.
And if you are wanting to move to another house in the Valley, you can do so at any time and be in the same boat, which is if you sell your home for less than it was worth a few months ago you will be buying a home for less than you would have a few months ago. If you wait for your home to go up in value, the home you buy will have gone up. So, if you want to move, I will tell you to get where you want to be and enjoy your new home.
I also think we should be supporting as many local businesses as possible, so I am starting a networking group in the area. If you are interested, please give me a call or email, as it will be similar to other networking groups with one of each business represented.
As always, please feel free to contact me with any questions. I love talking about real estate!
Frank May grew up in the Valley, graduating from Northwest Christian School and Northern Arizona University. He is a real estate agent with RE/MAX Fine Properties and has been helping both buyers and sellers for over 20 years. He has been a Dave Ramsey Endorsed Local Provider (ELP) since 2003. Learn more at mayteam.com.