The Phoenix area housing market posted it’s worst February in four years and home prices may stay flat throughout 2014, according to Arizona State University’s latest housing report last week. Despite the fact that substantially more homes were on the market than a year earlier, prices slipped by 1% from January and demand dropped by about one-quarter year-over-year.
Considering that volatility has been the norm for years, many local professionals don’t see the market “pause” as a bad thing, believing It to be healthy to have a flat market, because it maintains a certain level of affordability. There was also no way the Valley could keep up the fast pace it had during the past two years. Double-digit price increases just aren’t sustainable. When there was a supply shortage a year ago, it was almost too easy for a seller to get their home sold. With more supply, many realtors feel the market is more “normal”. What the area is facing now is a lot of unrealistic sellers stuck in last year’s mind set of short supply.
Although there is much more inventory now, a lot of sellers are holding out and hoping to ride the wave of the busy spring buying season. The problem is that this spring season has been slower than usual, with a standoff between buyers and sellers. Buyers are sitting back in hopes of prices dipping, which they might, and sellers are still expecting double-digit price increases which is not happening.
Loan officers are seeing increased loan applications and many local realtors are busy, but many buyers are still hesitant to pull the trigger.
To talk about how today’s market can work to your benefit, call Lyn at 602-739-0095.