Join Ian as he covers the housing market trends of the Phoenix area.
Video Transcript:
Hi this is Ian with The Kay-Grant Group. Today we are going to be covering the November STAT update, which is everything related to the available housing inventory, what the cost per square foot is and so on. Let’s jump on in and see the current state of the Phoenix area housing market.
When looking at the total available inventory we are seeing nothing short of a massive drop when comparing year-over-year from 2018, nearly a 20% deficit. Also comparing from just the prior month, where we did see a mild trend for a recovery in the available housing inventory from September to October all of that available inventory is gone.
Now taking a look at new inventory on it’s own, there doesn’t seem to be a short recovery in the near future. We are seeing a deficit for year-over-year of over 23%, and a month-over-month deficit of 11%.
So naturally, what does that lead to? Higher housing prices of course. We are seeing a steep rise in the new listing market and the median listing price of 7.9% and 7.1% respectively. If you happen to be into index funds you know the Phoenix housing market is beating the average return on those.
How is the market inversely affected? Lower numbers of sales of course. Even though the year-over-year is up, it simply cannot keep up with the month over month trend which reflects a deficit of 11%. Obviously, when the market looks this good for a seller, people have a tendency to hold on to their property for significantly longer waiting for that price per square foot to peak. It also involves how much of the available inventory is desirable, because we are seeing a slowing down of new builds coming onto the market.
So what is going to be the sales price forecast? We think that the overall increase reflected in the report is very conservative where it is showing a marginal increase on the average and small jump in the median. Since Q1 tends to reflect a vertical spike in most cities and subdivisions, do not be surprised if you see a several percentage point increase.
So what do we at Kay-Grant recommend? For the most part, no one can really lose if they decide to put their home on the market right now, the only foreseeable downside is if you try to get your home sold in the latter half of Q2 transitioning into Q3 where we see a significant dip in most of the valley, since you know summer and all that. With the average home sale taking 53 days right now, putting your home on the market in Q1 is highly advisable.
That is it for the rest of the year. We at Kay-Grant hope you are having a wonderful holiday season and can’t wait to hear from you in the new year!