By Jonathan Bodeen · 28 October 2019
BUT NO ENCOURAGEMENT IN THE LONG TERM
Almost all of the cities that make up the “Phoenix Metro Area” showed a shift toward buyers over the last week, according to the Cromford Index. Now in all these cases, we are still heavily entrenched in a seller’s market, and it would take many more months of this trend continuing before we started seeing a balanced market again.
This is mostly due to an increase in inventory of available homes, not a decrease in buyer demand. Usually, this increase in inventory is typical of this time and peaks around the third week in November. Not many are apt to put their homes on the market during the holidays.
So for now we can expect to remain in a seller’s market. Prices will continue to increase. When will this change? We can’t say, but it seems to us that until people stop moving here in droves from places like California and the Midwest, we shouldn’t expect any different.
Some are predicting a need for 150,000 new apartments here in the Phoenix Metro by the year 2030. These prospective new tenants are coming to the valley for the jobs that we are creating and typically rent first before buying. They are often fleeing states with heavy tax burdens and increasingly hard to manage costs of living.
It’s exciting to be in a city where healthy growth remains the norm whereas other places like California seem to be reaching a tipping point on growth. The drawback is for prospective home buyers who may have missed their best chance to buy during the downturn and subsequent housing revival.
For the sake of ending on a positive note for buyers, I’ll ad that mortgage rates remain historically low!
Market data referenced in this article comes from The Cromford Report.