By Mike Bodeen · 12 April 2021
Interesting information that the Cromford Report has provided once again for us data geeks who like to spot trends in the local housing market. Unfortunately, not everything we discover is good news for all segments of our market, notably first time or low-moderate home buyers. There is a very real concern for the health of our market, our communities. In many ways, it’s a good market. But maybe it’s not the best!
First, some numbers from Maricopa County’s affidavits of value (AOV) recorded in March. AOV’s provide an insight to our market. First, it gives us a clearer picture about the actual numbers of sales. In the Arizona Regional Multiple Listing Service (MLS) numbers, the sales include only those from the MLS, not for sale by owners, so the data is different. This is county only, not the local MLS which counts other counties in the state.
Secondly, affidavits of value tell us who’s buying our homes, including single family detached, and condo/townhomes. It tells us whether or not the buyers are going to use the homes as:
Owner occupancy primary residence
A rental/investment
A second Home (usually vacation home)
March 2021, had sales that were up 29.3% higher than March 2020. Of these sales, the intended usage are as follows:
Owner Occupancy residential sales up 12.7%
Rental Property sales up 52.1%
Second home sales up 36.2%
So what’s the concern? Cromford points out that whereas sellers of homes are currently benefitting from higher values, the lion share of buyers are to rent them out. So, our neighborhoods increase with more renters. To be honest, this is a slippery slope because the rental pool of homes available, are also severely limited. The fact is that we need more housing, both for rent and to buy.
“Navigating multiple offers for sellers and making offer, after offer, after offer for buyers is taxing…”
The Bodeen Team is currently working with an out-of-state seller who has a townhome to sell in North Phoenix. We had offers ranging from $370,000 to $400,000. The $400,000 cash buyer already owns more than three thousand homes in the valley and continues to buy homes by out-bidding other buyers. There was a slight wrinkle in the $400k offer that the parties could not agree on, so our client went with a slightly lesser offer price – to a primary home buyer.
We also have another deal on a home where the seller felt an affinity to the buyer because of a personal letter written by our buyer to the seller. This seller had other offers, the highest being $17,000 more than our clients. They went with our clients. Oh happy day!
Friends say to us, “oh, you must be doing pretty well with the crazy real estate market going on.” Well, it has been a good 12 month stretch run, but it’s a very hard market to work in. Navigating multiple offers for sellers and making offer after offer, after offer, for buyers is taxing. But then again, in all the decades of being a career real estate professional, when it comes right down to it, none of the years are easy.
Market data referenced in this article comes from The Cromford Report.