We’re going to learn a great deal about the Phoenix real estate market over the next couple of weeks. Lender moratoriums on foreclosures are coming to an end and, depending on who you talk to, the market’s soon to be flooded under a vast wave of backlogged foreclosures.
Except … no one’s really sure where things stand.
Theoretically, the moratorium was supposed to be on homes already in foreclosure. Yet what you hear quoted often are the number of homes where Notices of Trustee’s Sale (a public notice that the homeowner has 90 days to get current or the house will be sold on the courthouse steps or revert to the bank) have been extremely high over the past couple of months. One of the bubble blogs said there were more than 10,000 notices issued in Maricopa County last month.
Doesn’t sound like a moratorium, does it? In truth, the moratorium was limited in scope – only owner-occupied homes qualified. If the owners already had left or the home was owned by an investor, the process has been preceding as before.
There’s little question that the number of bank owned homes on the market will rise in the coming weeks – there were less than 4,000 new single family detached REO listings in Maricopa County in April. But is that necessarily a bad thing?
Consider that there’s less than six weeks of bank owned inventory on the market. Double the number of foreclosed properties and you still have only three months of inventory at the current sales pace, which still represents an extremely fast-moving market.
The spike we’ve seen the past two months have lifted all boats; inventory of traditional sales have fallen along with the inventory of bank owned homes. Nearly a year of inventory isn’t necessarily anything to write home about, but it’s better than 18 months to two years of inventory, which is what we had seen not so long ago.
Everyone who reports on the market has a slant of some sorts. Bubble bloggers need to report the doom and gloom because that’s their purpose in life. Many real estate agents spout that it’s a good time to buy because they don’t know how else to communicate with the public – they’ve never realized the power of honesty.
Me? I realized long ago there’s no such thing as a good or bad market. What’s good for one could be bad for another. I spend yesterday meeting with someone who was afraid the already low listing price I quoted was too high for their purposes. For a rare moment in a listing presentation, I was the optimistic one.
I can’t tell you what’s going to happen these next couple of weeks. No one can. The definitives you see are little more than guess work. Maybe we’ll be overwhelmed, but the Phoenix real estate market has shown for months that it’s more than capable of handling a higher level of bank owned inventory.
What I do know is the buyers have emerged from the woodwork, the latent demand we’ve talked about now is apparent in the rise in closed and pending sales.
Whatever may come, it’s going to make for an interesting May.[tags]Phoenix real estate[/tags]