Posts in category 'Buyers'

It's a Buyer's Market, Will Prices Drop?

For Buyers:

The buyer's market in Greater Phoenix is still young at just over 5 weeks old but isn't getting worse thanks to supply stabilizing over the past two weeks. For some, this scenario brings anticipation of a decline in sales prices, however there's more to this buyer's market than meets the eye. There have only been 3 other buyer's markets in Greater Phoenix over the last 25 years, and they are all unique in their circumstances and thus give us little to compare with our current market.

What can we expect in terms of price trends today with our new baby buyer's market? That depends on how long the market stays friendly towards buyers. Sales price is the last measure to respond to a shift from a seller advantage to a buyers advantage. The first measure to crack is the seller's asking price. When that doesn't improve buyer interes...

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For Buyers:

It may be hard to believe, but recessions are historically the beginning of a turnaround for the housing market. After enduring more than 2 years of declining sales, sellers and buyers may start moving and transacting again. While recessions are negative for the economy (as they coincide with higher unemployment), two things typically occur that turn the housing market positive.

The first is home value stabilization. In every recession since 1970 (except for one infamous recession in 2008) home values had minimal fluctuation and appreciation year-over-year. The second is mortgage rates. Every recession since 1970 saw mortgage rates decline while at least 90% of the labor force remained employed. According to the August employment report from the Arizona Dept of Economic Opportunity, private sector earnings rose 7.3% annually in June, and 5.3% in July. Both rates are higher than the rate of inflation, and higher than the rate of home price...

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It's a Buyer's Market Once Again In These 8 Cities
Median Seller Incentive Hits a New High

For Buyers:
Buyers who felt they lost out on the buyer's market last year will be getting another chance this year. The Greater Phoenix housing market, on the whole, only has a few days left before it enters a balanced market. However, as 18 cities are still in seller's markets, there are 11 that are either already in balance or in buyer's markets.

What does a buyer's market mean for buyers? Most buyers assume it means that sales prices will come down, but by the time sales price measures show a decline the buyer's market could be 2 months old, or already over like it was last year. The first thing to move isn't a sales price, but a list price combined with higher seller incentives for buyers.

Over the past 2 months, as mortgage rates peaked at 8%, weekly price reductions increased in number by 33%. Meanwhile, the median seller incentive to...

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