{"id":546,"date":"2015-01-24T04:27:45","date_gmt":"2015-01-23T23:27:45","guid":{"rendered":"https:\/\/nohasslelistingblog.com\/?p=546"},"modified":"2015-01-24T04:27:45","modified_gmt":"2015-01-23T23:27:45","slug":"the-early-clues","status":"publish","type":"post","link":"https:\/\/nohasslelistingblog.com\/?p=546","title":{"rendered":"The Early Clues"},"content":{"rendered":"

2015 is now underway and all eyes are searching the horizon for signals foretelling this year\u00e2\u20ac\u2122s real estate trends.\u00c2\u00a0 Will 2015 differ from 2014, or will \"Travis<\/a>history repeat itself?\u00c2\u00a0 Trends by their nature involve time.\u00c2\u00a0 So attempting in February to predict the market of 2015 is a dicey proposition.\u00c2\u00a0 But we certainly have a few early clues.<\/p>\n

Not unlike 2014, supply is still very constrained.\u00c2\u00a0 Sellers are failing to come to market in any significant numbers \u00e2\u20ac\u201c causing the supply of homes for sale to fall well below \u00e2\u20ac\u0153normal\u00e2\u20ac\u009d amounts.\u00c2\u00a0 The first signs of this showed up in December, which was the first month in 2014 that active listings were lower than they were in the corresponding months of 2013.\u00c2\u00a0 As a case in point, in the last 7 days of December, new listings were down 13% compared to 2013 and down 14% compared to December 2012.\u00c2\u00a0 Beginning 2015, available homes were lower than any point of 2014 for Phoenix, Anthem, Avondale, Gilbert, Glendale and Tempe.\u00c2\u00a0 In fact, El Mirage was at its lowest point of available homes in the last 10 years!\u00c2\u00a0 Of course there were exceptions \u00e2\u20ac\u201c such as Sun Lakes, Maricopa and Paradise Valley.\u00c2\u00a0 But, this still seems to have been the first signal for 2015 trends \u00e2\u20ac\u201c low supply of homes.\u00c2\u00a0 Here is what our favorite real estate trend watcher, Michael Orr, recently had to say:<\/p>\n

\u00e2\u20ac\u0153There have been a total of 4,353 new listings added since the start of the year (across all areas & types) which is 9.1% below 2014 and 1.3% below 2013. This is a low number and suggests that supply trends are weak despite the seasonal increase in active listings that we see in January every year. In fact it is a new record low for the 15 year period 2001-2015.<\/em><\/p>\n

New supply is particularly weak at the bottom of the market under $200,000 while it is quite strong over $800,000.<\/em><\/p>\n

Sellers of entry level homes are going to have less competition while sellers at the top end are going to have more competition compared with last year.<\/em><\/p>\n

The new supply of short sales and REOs across greater Phoenix is much lower than in any of the years since 2008, but is higher than 2007 and all previous years since 2001. HUD homes are down to insignificant levels, lower than all years since 2001 except 2005 through 2007.\u00e2\u20ac\u009d<\/em><\/p>\n

As referenced, the luxury market is a market unto itself.\u00c2\u00a0 It rarely acts in unison with the market as a whole.\u00c2\u00a0 For instance, supply remains heavy in the luxury market, despite December 2014 being a huge month for luxury homes sales.\u00c2\u00a0 December 2014 was the best December for luxury sales since 2006 with 109 closed transactions across Greater Phoenix for homes priced at $1 million and above. But make no mistake; luxury supply still well outpaces demand.<\/p>\n

Thankfully, the buyer mix has shifted away from investors and back to an owner occupied dominant market. We are of the mind that this is a good thing \u00e2\u20ac\u201c as we have mentioned in previous articles. Abnormally large investor activity is a sign of a very unhealthy market \u00e2\u20ac\u201c such as was the case in the over-exuberant market of 2005 or the walking dead market of 2009.\u00c2\u00a0 In 2015, we are back at a market where the buyer is the end user.\u00c2\u00a0 Recent changes to lending are now arriving to stimulate the market \u00e2\u20ac\u201c particularly the first time buyer market (are you listening millennials?) President Obama\u00e2\u20ac\u2122s visit to Russell\u00e2\u20ac\u2122s alma mater (Central High) was perhaps more news worthy than noteworthy \u00e2\u20ac\u201c but he did announce the changes to FHA\u00e2\u20ac\u02dcs insurance program that will assist a small segment of the population.\u00c2\u00a0 The drop in the cost of FHA insurance gives buyers in this price range an approximately additional $20,000 of buying power.\u00c2\u00a0 Add to that Fannie Mae and Freddie Mac\u00e2\u20ac\u2122s new lending programs with 3% down \u00e2\u20ac\u201c helping homeowners who didn\u00e2\u20ac\u2122t have the 5% down typically required and who may have exceeded FHA\u00e2\u20ac\u2122s loan limits (currently $271,050 for FHA, $417,000 for Fannie\/Freddie conventional loans).<\/p>\n

Given our low supply and our slightly stronger demand, our market has drifted from a slight buyer\u00e2\u20ac\u2122s market to a balanced market.\u00c2\u00a0 If this trend continues, we could very quickly see seller\u00e2\u20ac\u2122s regaining the upper hand in negotiations. In fact, should demand increase in any significant way, it will rapidly overtake our supply. It will take a bit of time for the constraint to result in higher pricing \u00e2\u20ac\u201c price being a trailing indicator- but it will show up.\u00c2\u00a0\u00c2\u00a0 If this comes to pass, Buyers may be wishing they bought in 2014.\u00c2\u00a0 What is good for the duck hunter is rarely good for the duck.<\/p>\n","protected":false},"excerpt":{"rendered":"

2015 is now underway and all eyes are searching the horizon for signals foretelling this year\u00e2\u20ac\u2122s real estate trends.\u00c2\u00a0 Will 2015 differ from 2014, or will history repeat itself?\u00c2\u00a0 Trends by their nature involve time.\u00c2\u00a0 So attempting in February to predict the market of 2015 is a dicey proposition.\u00c2\u00a0 But we certainly have a few […]<\/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],"tags":[],"class_list":["post-546","post","type-post","status-publish","format-standard","hentry","category-home-values","category-market-stats"],"_links":{"self":[{"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/posts\/546","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=546"}],"version-history":[{"count":1,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/posts\/546\/revisions"}],"predecessor-version":[{"id":548,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=\/wp\/v2\/posts\/546\/revisions\/548"}],"wp:attachment":[{"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=546"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=546"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/nohasslelistingblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=546"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}