We’re shifting to a buyers’ market.Don’t believe me?

Why does this matter? It is a great time to sell before we get deeper into a buyers’ market and values start to come down. It is also a great time to buy as interest rates are still at record lows and house buying is still extremely affordable.

Queen Creek, Mesa, Gilbert Market Statistics changing market

See Below for larger View. Queen Creek, Mesa, Gilbert Market Statistics for a Changing Market

 

We did a little research into four different real estate submarkets trends: The Gilbert, Queen Creek, Mesa, and Phoenix real estate markets gave a good cross section of the Greater Phoenix Area. If you are at all interested in buying or selling a house, this information is crucial to making a good decision. I was doing some research on concessions and found the results alarming.

Concessions are also a good indicator of a changing market. When a seller is willing to contribute money (concessions) towards the buyers’ closing costs, it is relatively safe to assume they are not receiving multiple offers. A snapshot of sales concessions six months ago versus today reflects an interesting trend. According to the MLS, only 3% of all sold properties in the price range of $180,000-$220,000 gave concessions of at least 1%. In the past thirty days however, 13% have included, at minimum, 1% in concessions. It appears that the market is rapidly changing to a buyers’ market again. I did a little more digging to see if values would follow suit.

  1. Active list volume is way up in each city, meaning more people are listing their homes and/or less people are selling. Increasing list volume often indicates a declining market.
  2. Total number of active listings are up in each city and similarly also often indicates a declining market.
  3. Phoenix is the only market that had an almost flat average list price last month. All three other markets are showing increasing list prices. This generally indicates an increasing market, however, in this case, I believe it is spillover from last year’s steadily and rapidly increasing values.
  4. Absorption rate is a representation of the relationship between days on market and current inventory. Basically, how long will it take to sell all the current homes on the market? The trend is up indicating a declining market.
  5. Sale to list price ratio is a great indicator of a market changing, however, in this case, it is all over the board. I think we can say that over the last year the trend is decreasing, indicating the start of a declining market.
  6. Days on market according to the chart is inconclusive for the past couple months, however, the data for the past thirty days is up, indicating a declining market.

Summary: With the exception of list prices (which is based largely on speculation) all indicators reflect trends consistent with the beginnings of a downward trend. One thing to take into consideration is the time of year. Real estate often slows down a bit this time of year. The holidays can skew the stats a bit, although many of these trends appear to have started around June, well before the holidays. Looks like the market will be leveling off over the next few months, and if the trends continue, values will start dropping next year.

Queen Creek, Mesa, Gilbert Market Statistics changing market

Queen Creek, Mesa, Gilbert Market Statistics changing market