By Jonathan Bodeen · 19 December 2016
CHANGE IS IN THE WIND
2017 looms ahead like a huge question mark for many people. Now we’ve never claimed to have a crystal ball, but I’ll fill you in on a few things here that we are actually feeling quite confident about.
The cost of starter homes here in the Valley will continue to rise. This will probably be true both in terms of the purchase price and monthly loan costs, via interest rates.
Many voices are shouting the end of super low interests which were at their lowest in October of this year at 3.42% and they have now gone over 4%. Some predict rates will reach as high as 5%. While this is still low in historical standards, the difference that this represents in monthly loan costs for the same purchase price is hundreds of dollars.
As we continue to have net gains in jobs here in AZ, demand for entry level ($250k and under) is increasing and there seems to be no new supply in sight. Most builders are constructing $300K plus homes and even those are being built at a marginal place since we have a shortage of skilled laborers in the housing industry. This weakness in supply and strong demand foreshadows increasing prices on the low-end.
If you are thinking of buying in this price range, THE TIME IS NOW! And I assure that is not me being salesy.