Wednesday, June 27, 2012

Phoenix Metro Area Market Report for May 2012

Here is the Market Report for the period ending May 2012.  Prices are the highest they have been in 3.5 years, inventory continues to fall, and homes are selling faster than ever.

For a more thorough understanding of how the market is shifting and how this affects you, please give me a call and we can discuss it in more detail.

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Average Sales Analysis:

Sellers: Attention! For 9 months, we have seen the average sales price increase from what appears to be the bottom of the market that we hit in August of last year. May saw an increase in our average sales price by 6.5% to $210,145. This is highest average since November of 2008! For the first time in 3 ½ years, we have broken the $200,000 barrier! It is now more important than ever that sellers continue to price according to the market and understand how the current market will apply to your individual area and/or home. It will also be important to monitor the impact this trend begins to have on appraisals and finding qualified buyers at these higher prices.

Buyers: For buyers, it is absolutely critical to be aware of this shift in the price of homes. This increase means that buyers once again have less buying power than they did in the prior month. There is no doubt that the low inventory has created competition for the current inventory, and that this high demand is impacting prices. The days of buying a $60,000 home may be a thing of the past!  More than ever, you need to work with your real estate professional to make sure you have the best possible information regarding the market value of homes and to carefully monitor this trend to see how it will impact the availability, pricing, and terms associated with purchasing a home.

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New Listings Analysis:

Sellers: The month of May saw an increase of 117 new listings entering the market as compared to the month of April. It is actually normal to see new inventory decrease in this month, so the market appears to be varying from the trends of the prior 2 years.  At a time when buyers are competing to find a home, May saw the 4th lowest number of new inventory in the 36-month reporting period. Sellers should monitor this new inventory to see how it might impact the sale of their home. In this great market, it is even more important that sellers need to make sure they remain as the top choice for active buyers in the marketplace. If your home is not selling in this aggressive market, it is more than likely a pricing issue – buyers are still looking for the best value possible.

Buyers: Buyers pay attention! May brought you 8,092 more options!  This is potentially good news as buyers continue to submit multiple offers on available inventory. More than ever, it is essential that you take advantage of this new inventory.  Spend time with me and we can develop your strategy for succeeding in a market that is constantly changing.

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Months of Inventory Analysis:(This report  has been generated by taking the number of active listings and dividing it by SALES for the past month)

Sellers: The high demand for residential properties in Maricopa continues to have a significant impact on the available inventory. The month of May saw a 5% DECREASE in this number, resulting in only 1.3 months of inventory. This is by far, the lowest number we have seen in the 36-month reporting period. This is a dramatic change from the 22.74 months of inventory we had a few years ago. This statistic means, that on average, we continue to remain in an even stronger “seller’s market” that is identified when this statistic reflects less than 5 months of inventory. Although this traditionally means that sellers will have more control in a sales transaction than the buyer, it is essential that you are meeting with your real estate professional to determine the ACTUAL market in your area. You may find that you have more or less control than the average.

Buyers: Buyers will want to seriously monitor this as well, as it indicates that there is extremely low inventory. We remain in a very strong seller’s market.  A seller’s market traditionally gives less control to buyers and can create significant competition for the current inventory. The current low inventory is resulting in homes selling more quickly, at a higher price, and with fewer concessions for buyers. However, the type of market will vary from price range to price range and even area to area.  Let’s have a discussion to make sure you understand the type of market you are in.
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Distressed Sales Analysis:
May statistics are having us seeing even more green, as non-distressed sales are becoming more and more prevalent in today’s real estate market! Green is the color of non-distressed sales, and we are seeing these properties become a much larger piece of the pie! We continue to shift toward a more traditional market—May bank-owned sales decreased by 1.7%. Short sales increased by 2.1%, and traditional sales INCREASED by .6%. At one point, traditional sales accounted for only 28.5% of home sales – the tide has definitely turned!

This statistic means that the competition from foreclosure properties continues to decrease while traditional sales from sellers with equity continue to increase the percentage of activity in our current market.

Sellers and buyers need to monitor this trend to see how the market continues to respond to the current inventory.
The numbers above represent the entire Phoenix MLS.
Would you like to know what is happening in your neighborhood?
Would you like to know the value of your home?
Do you need help deciding whether to sell or not or would you like to know if now is the right time to buy?

I would be very happy to get you that information.
Just hit the Reply and let me know.
Joseph D'Ambrosio
Executive Sales Associate
Keller Williams Integrity First Realty
18940 N. Pima Road Ste 100
Scottsdale, AZ, 85255
Cell: 623-810-4824