{"id":468,"date":"2014-05-02T03:48:02","date_gmt":"2014-05-01T22:48:02","guid":{"rendered":"https:\/\/nohasslelistingblog.com\/?p=468"},"modified":"2014-05-02T03:49:16","modified_gmt":"2014-05-01T22:49:16","slug":"better-late-than-never","status":"publish","type":"post","link":"https:\/\/nohasslelistingblog.com\/?p=468","title":{"rendered":"Better Late than Never"},"content":{"rendered":"

2014 began with a whimper as demand from Buyers waned to historically low levels.<\/span>\u00c2\u00a0 <\/span>Sellers, who seemed to be missing in \"\"<\/a>2013, showed up but buyers seemed to be unaffected by the increased selection of homes.<\/span>\u00c2\u00a0 <\/span>Market watchers kept looking for signs of the buyer drought ending to no avail – until now.<\/span>\u00c2\u00a0 <\/span>Finally buyers have begun buying again.<\/span>\u00c2\u00a0 <\/span>Whew, let\u00e2\u20ac\u2122s all take a breath.<\/span><\/p>\n

\u00e2\u20ac\u0153Buyers\u00e2\u20ac\u009d as a category form two sub-categories \u00e2\u20ac\u201c investors and owner occupants.<\/span>\u00c2\u00a0 <\/span>In previous articles we mentioned that the Hedge firms who had been buying for a few years here have largely ended their buying.<\/span>\u00c2\u00a0 <\/span>But investors also include the \u00e2\u20ac\u0153fix and flip\u00e2\u20ac\u009d groups as well as individuals buying a home or two for their personal investments.<\/span>\u00c2\u00a0 <\/span>We see that investors are buying at the lowest levels in years \u00e2\u20ac\u201c a good sign in our opinion.<\/span>\u00c2\u00a0 <\/span>To quote the one and only Michael Orr of the Cromford Report:<\/span><\/p>\n

\u00e2\u20ac\u0153Except for those unusual periods, which were dramatically affected by government intervention, the last time we saw investor buying activity lower than 16.2% <\/span><\/em>(the current level)<\/span> was December 2008.\u00e2\u20ac\u009d<\/span><\/em><\/p>\n

This tells us that the category of buyers currently in recovery is the owner occupant buyer.<\/span>\u00c2\u00a0 <\/span>This is a positive sign.<\/span>\u00c2\u00a0 <\/span>Although the change is only newly in place, if it continues for the next few months it likely will keep our market from swinging to a strong buyer market and prevent pricing erosion. <\/span><\/p>\n

Interestingly, buyer demand has varied dramatically according to price range.<\/span>\u00c2\u00a0 <\/span>Predictably, in the 200K and under price range both supply and demand are down.<\/span>\u00c2\u00a0 <\/span>Supply is down due to the distress product evaporating and the resulting price rises that accompany diminished distressed sales.<\/span>\u00c2\u00a0 <\/span>The dropped demand at that price come from investors leaving (as this was their preferred price point) as well as first-time buyers opting to rent rather than purchase (either by choice or necessity).<\/span><\/p>\n

Comparing the low end housing to the high-end and you find a dramatically different story.<\/span>\u00c2\u00a0 <\/span>As Michael Orr comments:<\/span><\/p>\n

\u00e2\u20ac\u0153For Greater <\/span>Phoenix<\/span> in March we had 109 sales of homes priced over $1,000,000. This is the highest March number for million dollar homes since 2008. For homes priced at or below $1,000,000 we had 6,503 sales which is the lowest March number since 2008. This divergence between luxury home sales and the rest of the market is quite striking. However there are still plenty of homes over $1,000,000 for sale so supply is not an issue. It must also be remembered that a home priced at $1,025,000 this year may have been $975,000 last year.\u00e2\u20ac\u009d<\/span><\/em><\/p>\n

Needless to say, demand will be the most critical area to watch this year.<\/span>\u00c2\u00a0 <\/span>Demand will determine which direction our currently flat pricing will take.<\/span>\u00c2\u00a0 <\/span>A word of caution, don\u00e2\u20ac\u2122t be mislead by potential news reports that state our \u00e2\u20ac\u0153median\u00e2\u20ac\u009d price is rising.<\/span>\u00c2\u00a0 <\/span>Due to the increase in high end sales and the sharp decrease in low end sales \u00e2\u20ac\u201c rising median pricing could be falsely interpreted as \u00e2\u20ac\u0153the market price\u00e2\u20ac\u009d is rising.<\/span>\u00c2\u00a0 <\/span>At this time, pricing is flat.<\/span><\/p>\n

When demand is weak in housing for an extended period, the population must go somewhere \u00e2\u20ac\u201c and in this case it means rentals.<\/span>\u00c2\u00a0 <\/span>Demand for single family rental housing has seen a sharp increase.<\/span>\u00c2\u00a0 <\/span>Eventually this will be good news for the housing market as first time home buyers leave rentals when owning is cheaper than renting.<\/span>\u00c2\u00a0 <\/span>We are not there yet, but the signs are pointing to that as a future possibility.<\/span>\u00c2\u00a0 <\/span>Here is what the Cromford Report says:<\/span><\/p>\n

The scarcity of single family homes available to rent is getting extreme. Other types of rentals are not so hard to find for rent, but single family homes have dried up, probably because so few new rentals are being created compared with 2010 through 2013.<\/span><\/em><\/p>\n

On January 1 we had 4,377 active single family rental listings. Today we have 2,391. That is a 45% drop in less than 3 months. On March 1 we had 2,806 so they have dropped 15% just in the last 30 days\u00e2\u20ac\u00a6. if inventory remains as tight as this it is likely that landlords will take the opportunity to push single family rental rates upwards. <\/span><\/em><\/p>\n

So the watchword for now is \u00e2\u20ac\u0153demand\u00e2\u20ac\u009d.<\/span>\u00c2\u00a0 <\/span>It is a situation we will continue to closely monitor and so keep our wonderful past, present and future clients fully informed. <\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

2014 began with a whimper as demand from Buyers waned to historically low levels.\u00c2\u00a0 Sellers, who seemed to be missing in 2013, showed up but buyers seemed to be unaffected by the increased selection of homes.\u00c2\u00a0 Market watchers kept looking for signs of the buyer drought ending to no avail – until now.\u00c2\u00a0 Finally buyers […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,4,6],"tags":[],"class_list":["post-468","post","type-post","status-publish","format-standard","hentry","category-home-values","category-market-stats","category-the-economy"],"_links":{"self":[{"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/posts\/468","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=468"}],"version-history":[{"count":2,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/posts\/468\/revisions"}],"predecessor-version":[{"id":471,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/posts\/468\/revisions\/471"}],"wp:attachment":[{"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=468"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=468"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=468"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}