HOME SALES ON THE RISE-

BEST PRICES MAY BE CURRENT ONES

National home sales and pending home sales are on the rise, a trend the Phoenix metropolitan real estate market is experiencing in its many submarkets.

Reports from the National Association of Realtors*(NAR), America’s largest real estate trade association, show home buyers responding to the homebuyer tax credit and favorable affordability conditions boosted existing-home sales in March, marking the beginning of a spring surge.

Pending home sales, a sale in which the contract has been signed but the transaction has not yet closed, increased in March too according to NAR, which further affirms a strong uptick in the spring home buying season.

• Phoenix Metro Home Prices Go Up

In our local Phoenix metropolitan market, we are seeing home sales rise which can be contributed to many factors, pricing being one.

The median price for single-family homes sold in January was $125,000 compared with May 2009 when the median price dropped to $115,000, the lowest recorded during the recession.  And March figures show the first monthly increase in the median price of non-foreclosure homes since the end of 2007.

• Housing Inventory in High Demand

In affluent neighborhoods like Paradise Valley and North Scottsdale, Realtors are finding that there are more buyers than homes.  There is more availability for jumbo and second-home mortgages as bank balance sheets strengthen.  And we are seeing man cash buyers from out-of-state and out-of-country I areas like the United Arab Emirates, Europe and Canada coming to market.

Median priced homes have also been in high demand, particularly because of the recent first time and move-up homebuyer tax credit which recently expired April 30.  In talking with real estate agents, they say their buyers still plan on purchasing homes even without the tax credit since homes are so affordable, interest rates are low and banks are more willing to lend.

• New Opportunities in Home Purchases

Foreclosures and short sales may not necessarily be the best bargain though.  Distressed properties are experiencing bidding wars that drive up the initial asking price, and often times these homes require substantial restoration from a lack of upkeep.

We are seeing a great deal of interest in new home buying opportunities today for builders’ spec homes builds on well-priced lots.  Buyers can receive great lending and upgrade incentives on new home builds which are not offered to distressed properties.

Considering an upswing in the real estate market is unfolding, the current home prices may be the best ones for buyers.  Affordability conditions are so favorable today that buyers will likely come out ahead when making a sound investment decision I their home search journey.

Dominic Scappaticci

President and Designated Broker Realty Executives