Recently I received a housing update and wanted to share some of the information with you. Home prices in the Phoenix Metro Area are up 6.4% over the last year.  In March of 2023 the Median Sale Price was $420,000 and today it is $447,000 a healthy increase. Home prices are expected to continue to increase in 2024 and a projected 13% increase in the number of homes for and new home builders continue to expand their inventory and offer sales back incentives to Buyers.  

If you have heard the "Home prices are crashing, there is going to be a glut of homes for sale and you better wait to buy..." you may have heard chicken little telling you the sky is falling. The truth is inventory and demand are almost balanced right now and the demand side is increasing as we go into our Spring Selling Season. Looking at the Cromford Market Index, which increased to 114.7 on March 18, 2024 we are in the green and rising.

Taking a look at mortgage rates, we peaked on October 19, 2023 with a rate of 8.03% and saw a recently low in January 2024 of 6.14%. Since then interest rates have increased to over 7.1% and are expected to remain in the 6.75% to 7.75% for 2024. So if you are waiting for interest rates to come down before you buy a home, that could be a big mistake as home prices are increasing.  As interest rates continue to normalize, more homes are being built and more Buyers and Sellers will be on the move, it is best to get your financial house in order now and make a move sooner vs later then there will be more uncertainty and competition. 

I am often asked "Is now the time to move, should I wait"? And I have always had the same answer and advice: Move when the time is right for you, if you need more space, want to be closer to family, love your interest rate but hate your home or neighborhood, have a new family member, or any other need, then by all means move. Don't wait for lower home price, lower interest rates or the perfect scenario because you will miss the opportunity of a lifetime to improve your life. The sooner you move, the better you will improve your situation. Everything in life evens out. When we purchased our most recent home, even as an Professional Real Estate Agent I was saying to myself "Wow, this home price is really high, I used to be able to get a huge home, a mansion really, in a great neighborhood in Phoenix, for the price of this modest 1,800 sq ft home and now all I get is this?" But looking back just a few years, it was one of the best decision our family made.  And comparing to what we would pay for rentt, I look at our mortgage payment and smile. Our neighborhood is great, our neighbors are friendly and our children were able to attend one of the best schools in the area.  On top of that our home price has increased, our mortgage balance has decreased , our net worth is higher and  our family is happier.  So don't wait to move.... just move when the time is right for you!

​If you or anyone you know has a real estate need (Buying or Selling) call or text me with their name and number. I promise to take good care of them and love your referrals. DONALD KEYS Selling Homes Since 2006 HomeSmart (602) 750-1744 

Information courtesy of Arizona's leading authority on the housing market: The Cromford Report.

Sellers: 
So, what’s to be expected this year? There is one market that can be affected by an election, and that’s the stock market. After the last 4 elections, the stock market has responded positively afterwards, which affects both luxury buyers and retirees with a high percentage of cash purchases. If a cash buyer expects their investment portfolio to be worth more after an election, they may simply put off their home purchase until the Spring. This can cause contract activity to stagnate for a couple months, but not enough to affect prices, and this mild affect can be offset by other mitigating factors, like seasonality, that would make the impact unnoticeable.

So far in 2024, listings under contract over $1M are higher than 2022, which is the #1 record year for this price range. Active listings over $1M are also at record highs, which is offsetting the increased demand and keeping price appreciation stable. Retirement communities are not experiencing the same however, as this segment is highly sensitive to inflation. When prices for necessities are high and uncertain, many buyers in this segment will choose to keep their cash for safekeeping.

Buyers: 
With many existing homeowners comfortably staying put these days, more attention is placed on first-time home buyers, affordability, and supply of homes. The first thing that comes to mind is the choice between renting and buying. According to RealData the median cost of a 3-bedroom apartment at a 50+ unit complex in Q2 2023 was $2,100 per month in Maricopa County. The median size is roughly 1,250 square feet. The past 30 days of sales show the median sale price of a 1,200-1,500 square foot, 3+ bedroom single family starter home to be $370,000 in Greater Phoenix.

Many first-time home buyers put down 3.5% on a FHA loan ($13,000 on $370K), and last month nearly 70% in this price range had a seller or builder agree to contribute to closing costs with a rate buydown. That’s a median contribution of $10,000 from the sellers. On February 1st, the average FHA rate was 6.0% according to Mortgage News Daily. With a 2/1 buydown from the seller, the first year estimated payment would be $2,159 per month, including taxes, insurance, and PMI. A permanent 1% buydown would equate to $2,375 per month. This puts the monthly cost to buy a small starter home within a few hundred dollars of the median rental rate.

Condensed Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report ©2024 Cromford Associates LLC and Tamboer Consulting LLC

If you are looking to travel this Summer, you might want to considering one of America's Hidden Gems. Courtesy of Buffini and Company here are a few places you might want to consider:

Birch Point Beach State Park, Owls Head, ME
This quiet and relaxing sandy beach is close to Camden and Bar Harbor and free of the crowds and traffic.

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Wildcat Beach, Point Reyes National Seashore, Bolinas, CA
Its highlight is Alamere Falls, a rare "tidefall" (waterfall that flows directly into the ocean).

North Shore Drive, MN
This stunning 154-mile trek stretches between
Duluth and the Canadian border, alongside Lake Superior.

Padre Island National Seashore, TX
This beautiful beach is ideal for camping and watching sea turtle hatchling releases.

Skyline Drive, Shenandoah, VA
This scenic, 105-mile National Parkway runs the entire lenath of the Shenandoah National
Park in the Blue Ridge Mountains.

Prairie State Park, Mindenmines, MO
​A public recreation area in Barton County, it encompasses nearly 4,000 acres of grasslands and woodlands.

Estes Park, CO
The base for Rocky Mountain National Park, it's home to wildlife such as elk and bears, plus miles of trails.

Ausable Chasm, NY
Known as the "Grand Canvon of the Adirondacks." its highlights include cliff hikes, mountain biking, river rafting and daring cable bridges.

Having been a "Valley Of The Sun" resident since the early 1970's, I have watched the Greater Phoenix Area grow up from that wonderful  "small town feeling" of around 918,000 people to the 5th largest city in the United States. We constantly change from 5th to 6th while competing with Philadelphia for the title. As of this post we are the 5th with just over 5 million people. 

According to the chart above, we are expecting a population explosion of nearly 20% over the next decade from 5 million people to 6 million people. Other experts predict the population growth will not be that high as you can see from the screen chart below with the historical population of the Phoenix area since 1950.

So how will the population growth of the Phoenix area affect home prices? The truth is no one really knows, but we can see what the latest market data shows thanks to Sarah Perkins at Navi Title.  According to The Cromford Report, the Monthly Median Sales Price has increased to $435,000, up from $429,900 just one moth ago. We have seen a steady increases of prices this year, approximately $20,000 for the Median Sales Prices in the Phoenix Area.

Due to supply (low) and demand (below average), our prices are continuing to increase and every city in the Phoenix Area are a Seller's Market except for two, Maricopa and Buckeye which remain a balanced market. ​

I have to admit, I miss that "small town feeling" Phoenix had growing up here in the 1970's into the 1980's. Some of the local favorite establishments have vanished and some are still here.  My grandfather worked for the steel company that supplied the steel for the "Madhouse On McDowell" where the Phoenix Suns played as a young new team and where the Arizona State Fair is still held today. 

If you are looking for that "small town feeling" you may want to consider Verrado Homes For Sale (all ages) and Victory at Verrado Homes For Sale in Buckeye AZ. In Verrado you can sit on your front porch and say "hello" to your neighbor as they walk their dog are on their way to the community park for a friendly bbq gathering.  You can click the links to view the latest homes for sale in the area.  I hope you had a great Memorial Day weekend and love calling Phoenix home like I do.

Phoenix area home prices are on the rise again. According to The Cromford Report Aprils Median Home Sales price rose 2.36%. As you can see from the graph below, our prices

Six independent studies have shown that Home Sellers who use the 72SOLD program received between 8.4% and 12% more vs selling in their local MLS. The latest study completed the first quarter of again showed higher prices coming in at 9.1%
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The real estate market is moving FASTER than I have ever seen in my career! Being a licensed real estate professional since 1997 and full-time since 2006, as you can imagine, I have seen a lot of changes. New home construction, the housing bubble, foreclosures, resale, the Covid crisis, the new-boom etc...

Working for the local 72SOLD affiliate Hague Partners has allowed me to help many happy Sellers, sell their homes for more money, in a shorter time, with the lease amount of convenience using the 72SOLD program especially during these changing times. One of the perks of working for the broker is we receive at least 5 hours of training to help our Sellers in this changing market and a weekly market update.  The latest graphic is posted above with some annotations.

You have hard in the news about how the economy is changing. Inflation, higher gas prices, higher grocery prices, supply chain crisis etc... But what is going on in the housing market?  Simply put, it is changing faster than I have ever seen in my career. Consumer sentiment is down to one of the lowest points we have seen when it comes to housing. Prices most likely peaked in February or March of this year (2022) and per the graphic above we have seen the fastest decline in the Cromford Index number since 2005! We are lower than 2005 now and keep on dropping.

Interest rates have gone from the "3" range to the "6" range in just 3 short months (see graphic below). Back in February 2022 if you purchased a $500,000 home with 5% down your interest rate was around 3% and your payment was approximately $2,483. Today with interest rates in the 6% range at 6.25% that same house payment is $3,405. That is approximately $1,000 per month more or 27% higher payment in just 3 short months! As you can imagine the number of Buyers who qualify for this new higher payment is significantly lower than earlier this year.  In a recent report from one of the companies that keeps track of Buyer showings, showed a 74% decline in showing activity. That is a major decline. Because of this homes are sitting on the market longer (28 days on average) and price reductions are a common occurance.

I am not trying to "scare" anyone or use a sales tactic in order to get you to sell your home. You need to be well informed so you can make an educated decision. If you are 100% happy with your home and your payment and don't have a reason to move, then don't. Enjoy your home. But if you have a reason to move, I would not delay! There are FEWER BUYERS and MORE HOMES coming on the market each day. Luckily, I am a 72SOLD program director and know the latest techniques and methods that must be used in our changing market to get you top dollar. An independent  study showed our brokerage is getting 11.2% more vs the MLS average in the first 5 months of 2022. If I can be of service and help you get your home SOLD, give me a call or text today at (602) 750-1744.