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Needless to say, our market has been as hot as our summer weather! In reference to the real estate market in Maricopa County for the month of July, Tom Ruff, The Information Market Data Analyst for ARMLS recently stated, “Day after day the news plays like a broken record, but when we look at the July sales data (as reported by ARMLS), it’s all about smashing records. The 10,303 home sales were not only the highest number of sales ever in July, but one of the highest monthly totals ever. Sales normally don’t peak in Phoenix in July; they almost always subside. The high-water mark for sales usually occurs in March, April, May or June. It is now clear that Covid-19 only paused sales, which in turn created pent-up demand. Our market has shown remarkable resiliency.”
The data for August was almost just as impressive. Per Tina Tamboer, Data Analyst for the Cromford Report, the past August was the third biggest August on record just behind August of 2004 which was a close 2nd to August of 2005.
With records being shattered and things changing so rapidly in this market, our clients are relying on us to stay as up to date as possible with the statistics. Here are some of the most recent questions our agents have been receiving from their clients and our answers to those questions:
Is this another bubble? That is a common question we are getting from clients these days. According to many experts in the field, the answer is no. In her weekly Zoom talks with area REALTORS®, Tamboer explains this by introducing the idea that the demand we saw in 2004 and 2005, prior to the burst of the bubble, was not real demand at all. The demand was driven by people purchasing properties under the guise that they would be living in them, when, in fact, they never intended to do so. Because of the number of properties that had been built prior to the bubble bursting as well as the investors buying up properties around the valley, we ended up with a glut of excess homes. Things are different now. Currently, inventory in ARMLS is shockingly low while the data from the Cromford Report shows that demand is staying slightly above normal.
What is fueling the current market? The shortage of supply coupled with excess demand is the perfect recipe to fuel the current market. Experts are saying that they think demand is holding strong because of the low interest rates currently available to buyers. Another interesting thing that could possibly fueling the current market in Maricopa County is the proposed tax increase on the wealthy in California as well as other states. In a recent National Review article, Robert Gutierrez, the President of the California Taxpayers Association said, “The tax hikes would be the tipping point for many taxpayers prompting them to book a one-way trip to one of the 49 states with lower taxes.” Many experts believe that the surrounding states such as Arizona and Nevada would and may already be benefiting from this “wealth flight”.
I have been thinking about selling my home. Is now a good time? Definitely! According to Danielle Hale, Realtor.com®’s Chief Economist, “Sellers are calling the shots in today’s market. Prices are rising and housing inventory is vanishing almost as fast as it appears.” In the same article for REALTOR® Magazine, Hale mentions possible changes coming to the market with the dynamics of uncertainty surrounding the pandemic as well as upcoming election in our country. If you have thinking about selling, we, as well as many expert, would recommend doing it now!
I would like to purchase a home. Is now a good time to buy? Surprisingly, YES! Even though supply is low, homes are still affordable. If you are in the market to purchase a home, now is the time to do it. In a recent article from the National Association of REALTORS® (NAR), NAR’s chief economist Lawrence Yun stated, “Although housing prices have consistently moved higher, when the favorable mortgage rates are factored in, an overall home purchase was more affordable in 2020’s second quarter compared to one year ago.”
We hope that you found the information in this post to be helpful. If you have additional questions, please feel free to reach out to us via email at email@example.com. We would be happy to help you navigate this crazy market. It is what we do, and we love our job!