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Scottsdale AZ Single Family Home Sales – September 2019

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– September 2019 Scottsdale Homes for Sale and Home Sales –

September was a typical off-season month where we saw sales and pending sales slow. However, sales in the lower price points continue to be strong. Like we saw in August, the Percentage of Homes Sold vs. Homes Listed for homes under $1 million came in at over 60% again.

SCOTTSDALE HOME SALES ACTIVITY – SEPTEMBER 2019

Each month, we track four items related to sales activity in Scottsdale.

– Single-family homes for sale – Orange Line – The number of homes on the market at the end of the month.*
– Under contract, but accepting backup offers (UCB) – Gray Line – How many homes were in UCB status at the end of the month.*
– Pending home sales – Yellow Line – How many homes were in pending status at the end of the month.*
– Home Sales – Blue Line – The number of home sales during the month.

SEPTEMBER 2019 RESULTS

September is another month that tends to show slow performance due to seasonality.

Scottsdale AZ home sales September 2019

  • Scottsdale Homes for Sale: Typically inventory of homes for sale tapers off during this time of year, but this September, inventory was up 1.7% at the end of the month.
  • UCB (Under contract, accepting backup offers): Following seasonal trends, UCB contracts were down in September. UCBs have been trending down since May.
  • Pending Homes Sales in Scottsdale: Pending sales fell slightly to 263 after being level the past 2 months.
  • Scottsdale Home Sales: 423 homes sold in September, down 5.8% from August. The bulk of these home sales, 360 sales, were for homes priced under $1 million.

Here are two more sales metrics that we track on a monthly basis.

Scotsdale real estate market September 2019

The Percent Change Month Over Month metric compares current figures to the month prior. Looking at the image above, you can see UCB contracts fell 9.1% between the end of August and the end of September.

Sales Price to List Price shows us on average what homes are selling for compared to what they were listed for. In September, it was 97.1%, meaning buyers saw an average discount of 2.9% off of asking prices.

*Figures for active homes for sale, UCB sales and pending sales are based on the numbers at the end of the month.

Search Scottsdale AZ Homes for Sale

Here is a sampling of some of the homes on the market, or click the link above to see all of the homes for sale.

Curious about your buying power? Click on the link to learn more.

 

Disclaimer: Data and information were pulled from the Arizona Regional MLS (ARMLS) as of 10/1/2019. Information deemed reliable, but not guaranteed. There may be new home inventory in these figures if the developer is using the MLS to market its homes. This post represents the opinion of the author. No warranties express or implied.
Copyright © 2019 Heather Tawes Nelson | Joyce Tawes

New Interactive Scottsdale Golf Community Map

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– Interactive Scottsdale Golf Community Map Relaunch –

North Scottsdale, Cave Creek and Carefree are home to a large number of world-famous private and public golf courses and communities. Names like Troon, Desert Mountain and The Boulders are just some of them.

Each of these communities offers a distinct lifestyle, a variety of home types and various membership options.

Years ago, we created an interactive golf community map so that people could explore the different communities and get a sense of what they were like. We have just relaunched this map with new artwork and wanted to introduce it to you. If you hover over the image, you will be able to click through for detailed information on each of the communities.

Golf Community Information

Once you get to an individual community page, you will find several tabs with information.

It starts with a brief overview of the community.

Then you can search for homes for sale in that community.

From there, you can read a more detailed description of the community including home options and what the lifestyle is like.

Next, is information about the golf course(s) and clubs.

Following that is real estate information including homes on the market, prices and historical home sales.

Then there is a quick overview of which school districts service the community.

And finally, there is a map of the community.

While the examples I used in this post were for Desert Mountain, each of the listed golf communities in Scottsdale, Cave Creek and Carefree have this same information.

If you would like to visit the page on our website, you can go to our Interactive Map of Scottsdale Golf Clubs page.

Not a golfer? Most of the communities offer Social or Sports memberships so that you can enjoy the amenities and socialize with other members.

Not interested in joining a Club, but love the community’s location? With the exception of Desert Highlands, no membership is required to purchase.

Have Questions About Any of These Communities? We are happy to help! Call (480) 209-7843 or contact us.

 

Things to Do in Scottsdale – October 2019

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We are in the final three months of the year! As temperatures cool down the number of events starts to pick up.

If we talk about October, we cannot not talk about Halloween, Corn Mazes and Fall Festivals. I wrote a post about those events going on all over the Valley and you can access that here.

Besides that jam-packed lineup, there are several non-Halloween and Fall Festival events going on in Scottsdale and Greater Phoenix. Here are some of them:

  • The McDowell Sonoran Preserve Turns 25! – Events all month – A long list of events celebrating the McDowell Sonoran Preserve are on tap to celebrate its 25th anniversary. There will be trailhead dedications, lectures, hikes and so much more.
  • Mesmerica 360 at the Arizona Science Center – Select dates through October 26th – This visual and musical immersive journey has had rave reviews. We are planning to go in October and look forward to it.
  • Phoenix Zoo ZooFari – October 4th – Come support the zoo at this fun and casual, yet elegant, event. Enjoy food and drink, live music and more!
  • Arizona State Fair – October 4th – 27th – The state fair is back and with it comes a lot of fun, fair food (and a healthy food section!), concerts, community performers, rides, esports, animals and so much more! Here is the fair calendar.

Arizona State Fair 2019

  • Wonderspaces Arizona – Elsewhere – Opens October 12th – The second installation of Wonderspaces will be unveiled on October 12th. This one is called Elsewhere and its motive is to make viewers question their realities. This is done through artwork, interactive exhibitions and virtual reality. The last installation was fantastic and we look forward to seeing what is new! (Pro tip: They have discounted pre-sale tickets on sale now!)
  • McCormick-Stillman Railroad Park’s Railfair – October 12th – 13th – Immerse yourself in all things railroad. Examine vintage railroad equipment and marvel at the extensive model train exhibits. Enthusiasts can take a walking tour as well as attend special presentations. Fun for all ages!
  • Tour de Scottsdale -October 13th – This cycling event benefits the McDowell Sonoran Preserve and offers 70 and 30 mile ride options for participants.

  • Arizona Taco Festival – October 12th – 13th – This taco festival will take over WestWorld. Tacos from dozens of local restaurants and food trucks will be available. Live music, lucha libre matches, taco and chili pepper eating contests, a chihuahua pageant and so much more will be going on.
  • Fall Plant Sale at the Desert Botanical Garden – October 19th – 20th – The Desert Botanical Garden will have over 30,000 plants for sale during this event. Plant experts will be on hand to help you and to answer any questions.
  • Phoenix Magazine’s Best of the Valley Awards – October 23rd– Head over to the  Scottsdale Center for the Performing Arts and sample food and drinks from some of the winners. Live performances will make the event even more fun.

As always, this is just a partial list of all of the amazing things going on in Scottsdale and around the Valley in October. Feel free to add any other events in the comments section.

Scottsdale AZ Luxury Home Market – August 2019

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– Scottsdale Luxury Home Market Performance for August 2019 –

Although actual sales fell off in August, there was some strong UCB and Pending activity, which bodes well for September’s figures.

All of these luxury homes in Scottsdale were listed at or above $1 million.

Each month, we look at four different sales statuses.
Active – The number of homes on the market at the end of the month.
UCB (Under Contract Accepting Backup Offers) – The number of homes under contract, but still accepting backup offers at the end of the month.
Pending – The number of pending sales.
Sold – How many homes sold.


– AUGUST 2019 –

Scottsdale Homes Priced Between $1,000,000 – $1,499,999

Scottsdale Home Sales Between $1 and $1.5 million August 2019

– Active Scottsdale Homes on the Market: Inventory actually increased by 7% between July and August. Typically, we see the number of homes for sale taper off at this time of the year.
– UCB Scottsdale Home Sales: UCBs were actually up by two at month’s end.
– Pending Scottsdale Home Sales: Pending sales were level and have been in the same range for the past three months.
– Scottsdale Homes Sold: Twenty-eight homes sold, which is a 24.3% decrease compared to July. This is the lowest we have seen this figure in the past year.
– Sales Price to Listed Price: 94.2% – On average buyers saw a discount off of list price of 5.8%.

 

Scottsdale Homes Priced Between $1,500,000 – $1,999,999

Scottsdale Home Sales Between $1.5 and $2 million August 2019

– Active Scottsdale Homes on the Market: Inventory was down almost 5% in August. This is in line with seasonal trends.
– UCB Scottsdale Home Sales: UCBs closed out August at eleven. They have been in this range for the past three months.
– Pending Scottsdale Home Sales: Pending sales rebounded in August after a very low July.
– Scottsdale Homes Sold: Only thirteen homes sold during the month. This is the second lowest we have seen this figure in the past year.
– Sales Price to Listed Price: 94.3% – On average, buyers saw a discount off of list price of 5.7%.

 

Scottsdale Homes Priced Between $2,000,000 – $2,999,999

Scottsdale Home Sales Between $2 and $3 million August 2019

– Active Scottsdale Homes on the Market:  The number of homes for sale in this price point was level between July and August.
– UCB Scottsdale Home Sales: The number of UCBs fell by two.
– Pending Scottsdale Home Sales: Pending sales saw a nice jump to sixteen. This is ahead of the 12 month average.
– Scottsdale Homes Sold: There were eleven home sales in August, which brings sales back to where they were during the same time last year.
– Sales Price to Listed Price: 94.4% – On average, buyers saw a discount off of list price of 5.6%.

 

Scottsdale Homes Priced $3,000,000+

– Active Scottsdale Homes on the Market: The number of homes for sale in the $3 million and up price range was level with the previous month.
– UCB Scottsdale Home Sales:  UCBs have come in at three monthly for the past three months.
– Pending Scottsdale Home Sales: Pending sales also came in at three. This is down slightly from July.
– Scottsdale Homes Sold:  Sales fell again to two. This is similar to what we saw at the same time last year.
– Sales Price to Listed Price: 93.9% – On average, buyers saw a discount off of list price of 6.1%.

 

If you would like additional detail on home sales activity, please visit our Scottsdale Luxury Home Market Reports page and click on the downloadable “Scottsdale Market Trends” report.

Search Scottsdale Luxury Homes for Sale

Disclaimer: Information deemed reliable but not guaranteed. Data and information were pulled from the Arizona Regional MLS (ARMLS) as of 9/1/2019 and can change at any time. The analysis looks at single-family luxury resale homes in Scottsdale AZ over the last 12 months. There may be new home inventory in these figures if the developer is using the MLS to market its homes. This blog represents the opinion of the author. No warranties expressed or implied.
Copyright ©2019 Heather Tawes Nelson | Joyce Tawes

Phoenix and Scottsdale AZ Luxury Condo Sales – August 2019

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– Luxury Condo Sales in Scottsdale and Phoenix – August 2019 –

The luxury condo market in Scottsdale and Phoenix had a very active August. Typically, we see a slowdown during this time of year, so to see strong sales activity is welcome.

For the purposes of this report, all condos with list prices of $1 million or more are being considered luxury condos.

Phoenix Scottsdale luxury condo sales August 2019

ACTIVE LISTINGS AT THE END OF AUGUST

At the end of August, there were forty-one luxury condos actively for sale. (In comparison, there were fifty-six for sale at the end of June.) Twenty-seven of them were in Scottsdale and the remaining fourteen were in Phoenix.

  • The most expensive listing was a carryover from last month. It is a new build under construction at Optima Kierland.  It has four bedrooms, four bathrooms and 5,042 square feet. It is on the market for $3,675,000.
  • The lowest-priced luxury condo was also located in Optima Kierland. It is ready for occupancy and has two bedrooms and bathrooms and 1,663 square feet. It was listed for $1,019,000.

 

UCB* LUXURY CONDO SALES IN SCOTTSDALE AND PHOENIX

There were an impressive five condos showing UCB status at the end of August.

      • Two of the UCB condos were located in Optima Kierland. The first was a three bedroom and bathroom unit with 1,718 square feet. Its asking price was $1799,995. The other unit also had three bedrooms and bathrooms and had 2,704 square feet. It was listed for $2,080,000.
      • Optima Camelview had one condo in UCB status. This was a two bedroom, two and one-half bathroom home with 3,197 square feet. It was on the market for $1,495,000.
      • The Residences at 2211 Camelback had a single UCB. The home had three bedrooms and bathrooms and came in at 3,000 square feet. It was listed for $1,275,000.
      • The final UCB was at 2 Biltmore Estates in Phoenix. This home had three bedrooms, three and one-half bathrooms and 4,817 square feet. Its asking price was $2,499,000.

*UCB status means a condo has an accepted contract, but that the seller has requested that they accept backup offers. Most times you will see this status when the contract is in the inspection/due diligence period.

 

PENDING LUXURY CONDO SALES IN SCOTTSDALE AND PHOENIX

There were four pending sales at the end of the August and they were all located in Scottsdale.

      • Two of the pendings were located at the under development ICON Silverleaf. The first one was a two bedroom, two and one-half bathroom home with 2,746 square feet and was listed for $1,499,000. The second unit had two bedrooms, two and one-half bathrooms and 2,721 square feet. It was on the market for $1,950,000.
      • Optima Kierland’s pending sale was a three bedroom and bathroom home with 2,018 square feet. It was listed for $1,939,000.
      • The final pending sale in August was at Optima Camelview. It was a three bedroom, two and one-half bathroom unit with 3,347 square feet. Its asking price was $2,200,000.

 

LUXURY CONDO SALES IN SCOTTSDALE AND PHOENIX

There were three sales of luxury condos in August.

  • The first sale was in Optima Camelview. It had two bedrooms and two and one-half bathrooms and 2,114 square feet. It had been listed for $1,149,000 and sold for $1,100,000.
  • A penthouse with fantastic views at Portland on the Park sold in August. It had three bedrooms and bathrooms and 1,940 square feet. It had been on the market for $1,139,000 and sold for $1,095,000.
  • The final sale of the month took place in The Residences at 2211 Camelback. This home had three bedrooms and bathrooms and 3,000 square feet. It had been on the market for $1,499,000 and sold for $1,425,000.

 

Learn More About Phoenix and Scottsdale Luxury Condos

Search Phoenix and Scottsdale Luxury Condos for Sale

Disclaimer:  Days on market figures are cumulative days on market. Information herein deemed reliable but not guaranteed. Data and information were pulled from the Arizona Regional MLS (ARMLS) as of 9/1/2019 and can change at any time. The analysis looks at resale luxury condos in Scottsdale and Phoenix over the past 12 months. Information deemed reliable, but not guaranteed.  There may be new condo inventory in these figures if the developer is using the MLS to market its homes. This post represents the opinion of the author. No warranties express or implied.
Copyright © 2019 Heather Tawes Nelson | Joyce Tawes

Halloween Events in Scottsdale for 2019

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– 2019 Halloween Events In and Around Scottsdale –

Although it does not feel like it outside, Fall and Halloween are almost here!

And with Fall and Halloween come Fall Festivals, pumpkin patches, haunted houses and more in Scottsdale and the Greater Phoenix area. Below is a collection of upcoming events going on around the Valley to celebrate this time of year.

Halloween Scottsdale 2019

 Halloween and Fall Festivals in Scottsdale and Greater Phoenix

  • Vertuccio Farms Corn Maze and Fall Festival – September 30th – November 3rd – This Fall Festival in Mesa is sure to delight. It will offer a ton of fun activities including a zip line, multiple mazes, mini-golf, a jump pad, a barrel train, an animal area and so much more. On the weekends, there will be magic shows.
  • Mother Nature’s Farm – October 1st- 31st – This family-run farm in Gilbert’s pumpkin patch will be open daily in October. Admission for the little ones is $10 each and that includes an OZ pumpkin, a hayride, bounce area, petting zoo, spider web crawl and maze. There will be food for sale, but you are encouraged to bring your own picnic and make a day of it.
  • Tolmachoff Farms Corn Maze and Pumpkin Days – October 2nd – November 3rd – This popular farm will be packed with pumpkins, a six-acre haunted corn maze, a corn maze for the little ones, train rides, a petting zoo and more. Like a challenge? Search the maze for the missing pieces of your map.  (Closed Mondays and Tuesdays and some activities like the train ride and tomato cannon cost additional.)
  • MacDonald’s Ranch Annual Pumpkin Festival – October 4th – 31st – This is one of my all-time favorite local events. MacDonald’s Ranch in North Scottsdale transforms into a Halloween and pumpkin patch wonderland. Catch a ride on the train, visit the petting zoo, navigate the hay bale maze and more. There will be food for purchase, a marketplace, a mechanical bucking bull and so much more. (Closed Tuesdays. Some activities, like hayrides and pony rides have an additional fee.)
  • Pumpkin and Chili Party at Schnepf Farms – October 4th – October 29th – Thursdays through Sundays -This is one of the largest events in the Valley. Head south to Queen Creek to enjoy a day of mazes, rides, animals, mini-golf, bonfires, zipline, dog shows and way too many other activities to list. There will be a large selection of food for purchase. This year, they will be open additional nights over the Fall Break dates. Check the website for more information and to see how you can get discounted passes.  (Some activities have an additional fee.)
  • Carefree’s Enchanted Pumpkin Garden – October 18th -27th – Get ready for some awesome pumpkin art! Ray Villafane and his team are back to carve their masterpieces this year. Besides the pumpkin art displays, there will be haunted happenings, costume contests, live music, family carve night, pumpkin pie eating contests and more. Here is the schedule of events.
  • Spooktacular Balloon Festival at Salt River Fields – October 25th – 26th – This “fun for all ages” event is back for the 9th year.  Check out over twenty hot air balloons, visit the pumpkin patch and kids zone as well as take your chances on the Spook Trail. There will also be fireworks, live music and food and crafts for sale.
  • Howl-O-Ween at the Phoenix Zoo – October 25th – 26th – Both evenings of Howl-o-ween will offer “Scary” (for ages 8 and up) and “Merry” experiences suitable for all ages. Make your way around the zoo trick-or-treating, meet some of your favorite characters, go to a dance party and more. Be sure to get your tickets early as this event sells out!
  • Strange Garden at the Desert Botanical Garden – October 25th – 26th – Mysterious and glowing creatures will take over the Desert Botanical Garden at the end of the month. Revel at the Villafane pumpkin art, dance away at the monster dance party more. Kids are welcome to wear their costumes!
  • City of Scottsdale’s Fall Festival – October 26th – The City of Scottsdale will be hosting its Fall Festival in Eldorado Park. From 5PM to 9PM, there will be games, a haunted forest, live entertainment and more. The evening will also feature a firework display. The Inflatable Arena will also be back with over 10 inflatables and face painting. (Free entry. $5-$10 entry fee for the Inflatable Arena.)
  • Cave Creek Wicked – October 26th – Harold’s Corral is throwing an all-day party to celebrate Halloween. During the day, the event is family-friendly and then move into a 21+ party in the evening. There will be costume contests, live music and more.
  • Nightmare on Princess Drive– November 1st – 2nd – This grown-up Halloween party will take place at the Scottsdale Princess Resort’s Plaza Bar. There will be DJs spinning, specialty drinks and a midnight costume contest.
  • Dia de los Muertos Celebration – November 2nd – 3rd – The Desert Botanical Garden will host a two-day celebration of this festival. There will be a market selling art, food and crafts, music, dancing and activities for the little ones.

 

Prefer to be Scared Out of Your Wits? These Haunted Houses Are Not for the Faint of Heart

Scottsdale Haunted House

If zombies, ghouls, terrifying creatures and getting frightened out of your mind are your preferred way to celebrate Halloween, here is a website that has all of the haunted houses, scary events and more. There are several locations all over the Valley, feel free to visit them all and scream your heart out!
Arizona Haunted Houses

 

This collection only includes a small number of Halloween and Fall festivals and events. If you have any others that you would like to add, please feel free to do so in the comments section!

 

Disclaimer: Information deemed reliable, but not guaranteed. Event dates, times and pricing subject to change. Most events are paid admission.

Quick Video Update of the Scottsdale Real Estate Market – August 2019

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– August 2019 Scottsdale Housing Market Video –

August 2019 – Video

Here is a one-minute video overview of the Scottsdale, Arizona real estate market for the month of August.

Scottsdale Active Listings

Scottsdale homes for Sale August 2019

The inventory of homes for sale at the end of August was 1,288. This is down from 1,338 at the end of July, but is level with August 2018.

Median List Price for Scottsdale Homes

Scottsdale homes median list price August 2019

If you are not familiar with what a median list price is, it is the midpoint of all home prices. That means half of the homes are priced higher than the median and half are priced lower.

In August 2019, the median listing price came in at $950,000. This is well above July 2019’s $899,000 and more than $100K higher than August 2018’s $825,000.

Days on Market

Scottsdale homes Days on Market August 2019

The Days on Market (DOM) statistic is a quick and easy way to tell how a market is performing. Essentially, it tallies the average number of days it is taking homes to sell.

In August, the DOM came in at 96 days, down from last August’s 100 days.

Median Sales Price for Scottsdale Homes

Scottsdale homes median sale price August 2019

Similarly to the median listing price, here is a look at the median sales price.

August came in a $585,000. This is better than August 2018’s $560,000, but it fell slightly from July 2019’s $601,000.

Number of Homes Sold

Scottsadale home sales August 2019

These last two images cover home sales in Scottsdale.

If you look at year-over-year sales, they were level.

Scottsdale homes sold August 2019

But, sales fell slightly between July and August 2019. They were down 3% month-over-month.

We hope that you found this video and commentary helpful as you gather more information to make smart informed real estate decisions.

For more Scottsdale real estate information or if you have any questions about the local area, feel free to contact Joyce at (480) 209-7843 or Joyce@LiveBetterinScottsdale.com.

Click to watch other videos on our Live Better in Scottsdale YouTube Channel.

Interested in other stats for our market? Visit our Real Estate Market Update page.

 

Disclaimer: Data deemed to be accurate, but is not guaranteed.

National Snapshot: How’s the Real Estate Market?

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US Real Estate Market Update Spetember 2019

The U.S. unemployment rate is at a 50-year low, and consumer confidence remains high. In fact, the University of Michigan’s latest Surveys of Consumers found that Americans have their most positive personal finance outlook since 2003.1

However, if you follow national news, you’ve probably heard speculation that we could be headed toward a recession. Global trade tensions and a slow down in the GDP growth rate have sparked volatility in the stock market, leading to economic uncertainty.

Given these differing signals, you may be wondering: How has the U.S. housing market been impacted? Where is it headed? And more importantly … what does it mean for me?

 

MORTGAGE RATES ARE NEAR HISTORIC LOWS

In August, Freddie Mac reported that the average 30-year fixed mortgage rate hit its lowest level since November 2016, falling to 3.6%, down a full percentage point from a year earlier.2 Variable mortgage rates also fell when the Federal Reserve cut interest rates at the end of July for the first time since 2008.3

This was welcome news for many in the real estate industry. Freddie Mac predicts that low interest rates and a robust job market will help the housing market remain strong despite the threat of recession.

“There is a tug of war in the financial markets between weaker business sentiment and consumer sentiment,” said Sam Khater, Freddie Mac’s chief economist. “Business sentiment is declining on negative trade and manufacturing headlines, but consumer sentiment remains buoyed by a strong labor market and low rates that will continue to drive home sales into the fall.”2

What does it mean for you? If you’re looking to buy a home, now is a great time to lock in a low mortgage rate. It will shrink your monthly payment and could save you a bundle over the long term. Or if you plan to stay in your current home for a while, consider whether it makes sense to refinance your mortgage at today’s lower rates.

 

PRICES CONTINUE TO RISE AT A MODEST PACE

According to the S&P CoreLogic Case-Shiller Indices, housing prices continue to rise. But the rate at which prices are rising is slowing down. For May 2019, the National Home Price Index rose by 3.4%, down from 3.5% the previous month.4

Of course, national averages often don’t present the whole picture. Some markets have seen modest declines, while other areas are witnessing double-digit increases. The key differentiating factor in most cases? Housing affordability.5

Since 2012, home prices have increased at about three times the pace of wages, according to National Association of Realtors chief economist Lawrence Yun.6 

“Housing unaffordability will hinder sales irrespective of the local job market conditions,” said Yun. “This is evident in the very expensive markets as home prices are either topping off or slightly falling.”5

But what about all this talk of a recession? Will we see housing values plummet like they did in 2008? Economists say no.

If we look at history, the real estate crash experienced during the Great Recession isn’t typical.

The recent Housing and Mortgage Market Review report from Arch Mortgage Insurance provides data to support this. “What we found is that the next recession is likely to be far less severe on the housing market than the last one. It’s not that this time is different; it’s that last time was really different from historic norms.”6

“A large decline in national home prices is unlikely in the next recession,” Arch economists write. “A persistent housing shortage should help cushion home price declines.”6

What does it mean for you? If you have the ability and desire to buy a home now, don’t let the threat of a recession hold you in limbo. The market is cyclical, and it will experience ups and downs. But over the long term, real estate has consistently proven to be a good investment.

 

US Real Estate Market Outlook 2019

STARTER INVENTORY REMAINS TIGHT WHILE LUXURY MARKET SOFTENS

As we’ve seen in the past, it’s become a tale of two sectors.

The low-end of the market remains highly competitive as buyers compete for affordable housing. (This is very evident in the Scottsdale and Greater Phoenix market!) A lack of new construction during the last recession led to an undersupply of starter homes. This trend continues—despite growing demand—due to a lack of skilled workers, rising land and material costs, and a slow permitting process in many areas.7

The result? There’s a shortage of homes for sale that Americans can actually afford to buy.

The luxury market, on the other hand, has softened. Economic uncertainty, changes to tax laws, and rising prices have slowed demand. Plus, to recoup their higher costs, builders flocked to this segment—causing an overabundance of supply in some areas.

“If you’re selling an entry level home, you’re probably still looking at a pretty competitive market in most places,” according to Danielle Hale, chief economist at Realtor.com. “But if you’re selling a more expensive home you probably have to adjust your expectations.”8

What does it mean for you? Move-up buyers, you’re in luck! If you’re ready to trade in your starter home for something more luxurious, you may get the best of both sectors. We’re still witnessing strong demand for entry-level homes, giving sellers the upper hand. At the same time, buyers of high-end homes are finding a greater selection (and more negotiating power) than they’ve had in years.

 

INVESTORS ARE BUYING HOMES AT RECORD LEVELS

There’s one group that hasn’t been slowed down by lack of affordability or economic uncertainty: investors.

According to CoreLogic, investors are purchasing homes at a record pace. In 2018, the share of U.S. homes bought by investors reached 11.3%—the highest level since the company began tracking nearly 20 years ago.9

Notably, this increased activity wasn’t led by institutional investors, but instead by small and individual investors focused on the starter-home segment.7 Declining interest rates and an uncertain stock market have led investors to flock to real estate as they seek out greater stability and higher returns.

“With declining mortgage rates … they’re searching for a better return for their money,” said NAR chief economist Lawrence Yun.10

What does it mean for you? If you’re looking for a way to “recession proof” your money, you might want to consider investing in real estate. People will always need a place to live, and (unlike the stock market) a rental property can provide a steady source of cash flow during uncertain economic times.

 

WE’RE HERE TO GUIDE YOU

While national real estate numbers can provide a “big picture” outlook, real estate is local. As local market experts, we can guide you through the ins and outs of our market and the issues most likely to impact sales and home values in your particular neighborhood.

If you have specific questions or would like more information about how market changes could affect you, contact us to schedule a free consultation. We’re here to help you navigate this shifting real estate landscape.

 

Sources:

  1. University of Michigan Surveys of Consumers –
    https://www.sca.isr.umich.edu/
  2. Freddie Mac –
    https://freddiemac.gcs-web.com/news-releases/news-release-details/mortgage-rates-drop-significantly?_ga=2.29332539.689041222.1565464527-928629548.1565464527
  3. CNN –
    https://www.cnn.com/2019/07/31/business/fed-rate-cut-july-meeting/index.html
  4. S&P Dow Jones Indices –
    https://us.spindices.com/documents/indexnews/announcements/20190730-965771/965771_cshomeprice-release-0730.pdf?force_download=true
  5. National Association of Realtors –
    https://www.nar.realtor/newsroom/metro-home-prices-increase-in-91-of-metro-areas-in-second-quarter-of-2019
  6. Forbes –
    https://www.forbes.com/sites/alyyale/2019/04/18/with-a-recession-looming-is-now-the-time-to-sell-your-home/#7d3a21665bce
  7. CNN –
    https://www.cnn.com/2019/08/09/economy/mortgages-home-buyers/index.html
  8. Forbes –
    https://www.forbes.com/sites/carolinefeeney/2019/07/01/halfway-into-2019-how-is-the-housing-market-holding-up/#7e656e3ec5d8
  9. CoreLogic –
    https://www.corelogic.com/blog/2019/06/special-report-investor-home-buying.aspx
  10. Fox Business –
    https://www.foxbusiness.com/economy/investors-snapping-up-homes-at-record-levels

 

 

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