Where is the market headed? Ask the Magic 8 Ball.
When I was first asked to write this month’s “Pulse on the Market” article for my community newsletter, I dusted off my Magic 8 Ball and started asking questions. I asked “Where is the market headed?” and the answer was “ask again later”. I then asked “How Much is My Home Worth?” and the answer was “yes, definitely”. I thought these answers were just as good as the predictions and statistics I see in the Cromford Report, the S&P/Case-Shiller Price Index, the FHFA housing price index or even the ARMLS Stats which I check frequently. I do this so I can attempt to answer the questions above with some amount of accuracy because they are the ones I asked most often.
In my opinion, we have a subdued market that is neither a buyer’s market nor a seller’s market. I see interest rates at an all time low. I see the number of lockboxes being opened today is 5% greater than a year ago and 25% over last week. Most importantly, I see buyers and sellers waiting for economic recovery that shows up in a paycheck and not just on paper.
Buyers need this recovery so they can afford a home. They no longer consider just the mortgage payment when purchasing a house; they are now looking at real estate taxes, homeowners insurance, HOA payments, car payments, utilities, and of course, the buyer needs to budget in food and clothing. Purchasing a home is no longer just a question of “Can I afford the mortgage?”.
Sellers need the economic recovery so they can decide if they can afford to sell. Has their home appreciated so they can sell without being upside down? Will they have the funds to purchase another home? If they answer yes to these questions, the seller then needs to decide if their home will appeal to buyers. Does it have the upgrades a buyer will want? Does the community have the amenities that a buyer wants?
Regardless of the economic outlook, I see sellers deciding it is time to move on, and I see buyers falling in love with a home, and both moving forward. 2015 will be a good year with prices continuing to climb at a rate to help sellers but not frighten buyers.
Want to take a closer look at market stats? We just published Market Stats by zip code on our website, and it is updated weekly and we are working to soon be able to publish these stats by community. The stats can be found here at http://cactusmountainproperties.com/contract-activity-by-zip-code/.
Are you ready to explore options on selling your home or buying one? Start here on our seller’s page or our buyer’s page to learn more. If you would like to learn what your home is worth, start with this simple form. Have more questions? Let us start answering them for you by calling us at (480) 688-8444.
Broker/Owner, Cactus Mountain Properties, LLC