So when is the opportune moment here in the Phoenix real estate market? I think it depends largely on what you’re trying to accomplish.
As of this morning, there are 11,108 detached homes for sale across Maricopa County. That’s a mere pittance when you consider the county is the size of New Jersey, but it’s also a 20% rise off this summer’s lows and also means we’re about where we started the year.
That’s not normal, not at the end of August.
Our market tends to slow beginning with the start of school, which was a couple of weeks ago, which causes a rise inventory but almost never back to January levels (which also are high after a holiday hiatus.)
All through the summer, as you recall, I’ve said that inventory rising of its own accord without a related slack in demand. That’s no longer the case.
As of the moment, with a week left in the month of August, there only have been 3,100-odd closed sales in August. That compares to 5,649 last year. In fact, you have to go back to 2008 to find an August that finished with fewer than 4,500 sales. (Fortunately, we’re already ahead of the dismal 3,112 sales for August 2007.)
As long as demand was relatively high, the market could sustain increases in inventory; we did have a shadow inventory here of sorts, not caused by banks holding back homes but by regular sellers waiting for things to get better.
With demand trailing off … well, that’s a bit more ominous.
A decline in demand was inevitable. Between the appreciation of the past year to 18 months and the significant rise in interest rates, many buyers have been priced out of the market and many others perceive that the market’s too high.
Not that a significant drop is likely, not unless inventory soars past the 18,000 – 20,000 mark and demand remains in the feeble 3,000 – 4,000 range.
As it stands, we’re sitting at about 3-plus months of inventory. Last month at this time, we were at about 2-plus months. It’s only a month, says you. That’s a 33 percent jump in marketing time, says I.
Has the opportune moment passed for those looking to sell? Not necessarily … I just listed and sold a house in El Mirage in 10 days, no mean feat.
But the moment of the opportune moment’s passing is on the horizon.
As for buyers? Don’t get complacent … rising interest rates are going to make things more challenging far more quickly than prices have any real chance of falling.
Get moving, my friends.
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Just for fun, here are some historic homes in the Willo District in Phoenix …[idx-listings tract=”Willo” propertytypes=”282″ orderby=”DateAdded” orderdir=”DESC” count=”5″]