Phoenix Real Estate Market – Update From Your Chinese Realtor
A detailed breakdown of homes in Maricopa County based on price … by determining the price range where your home should sell, you can see what the average list to sales price ratio is, the average days on market, and more importantly, the percentage of homes selling in that price range. Note that as the price increases, so does the days on market and the list to sales price ratio decreases. You will also see a lower percentage of homes selling as the price increases.
Are You Coming From Overseas Looking To Buy A Home
By reviewing the price range where you are purchasing, you can determine what the average home is selling for vs. list price. This should help you make better and more acceptable offers based on the current market.
Distressed Sales Analysis
A bank owned/foreclosure home is one that the seller no longer owns –it has been taken over by the lender(s) who had a note on the home. Short sales are homes where the seller is negotiating with the bank to “forgive” a portion of the debt in order to avoid foreclosure.
The market continues to shift, as we saw 67% of sales in the month of January classified as “non-distressed” sales. Bank-owned sales saw an increase from 12% to 15%, and short sales dropped from 26.9% to 18%. Sellers and buyers need to monitor this trend to see how the market continues to respond to the current inventory.
Average Sales Price Analysis:
For Sellers
January saw the average sales price of a home in Maricopa County decrease slightly by $2,869 from $218,945 to $216,076; this is the second highest average in the 36-month reporting period. Sellers should be careful and continue to watch this trend as they are pricing homes in today’s market. Just because the average sales price remains high does not mean that sellers are automatically getting more for their homes. Sellers are encouraged to spend time with their real estate professional to determine what is happening in their local market.
For Buyers
For buyers, it remains very important to be aware of this shift in the price of homes. Just a little over one year ago, the average sales price was $158,517. As prices remain high, buyers may find it more and more difficult to find a home that is affordable. Interest rates remain low, so buyers still have the edge in financing options. 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.
List to Sales Price Ratio Analysis:
Sellers:
This is the ratio a seller receives when selling his/her home as compared to the price where the home was. The higher the number, the closer the final sales price is to the listing price. Last month saw this number drop slightly from 97.42% to 97.05% With the competitive nature of the market, this ratio still remains very high. Continue to watch this trend, as it will continue to impact how homes should be priced in the current market in order to appeal to the buyers.
Buyers:
Buyers need to pay attention. As this average remains very close to 100%, on lower priced/highly desirable properties, buyers are still finding homes in the lower price ranges where they may have to pay above list price AND they are competing with investors who are bringing cash to the transaction. Since a home must appraise in order to obtain a loan, underwriters are still looking very closely at prices and making sure that homes are selling at or below market value.
This could mean that investors have an advantage if they are willing to pay higher than the list price. Make sure your real estate professional helps you understand the competitiveness of the list price of the home you are wanting to purchase. You also need to be aware of the interest and sales activity in the area where you are wanting to buy and how the offer you are making competes with the market and with trends relative to the price where homes are selling in the areas you have an interest. If you are looking for homes for sale in Phoenix, Chandler, Gilbert or Peoria; give me a call. I am a Chinese Realtor, I speak Chinese and work with many investors.
