November 2019 Market Update

Tia Moore discusses the November 2019 Market update. 

Overall Market Overview
What Current Market Means If You're a Buyer in Today's Market
What the Current Market Means if You're a Seller in Today's Market 
How New Construction Effects Phoenix Real Estate Market 
Fun Facts: Courtesy of the Oliver Whalen Team at Nova Home Loans 

Be sure to visit our website nextviewpodcasts.com for past episode and full blog. 
NextView Home Professionals can be reached at nextviewre.com for all of your real estate questions. 

The Oliver Whalen team can be reached at www.oliverwhalenteamcom for all of your home loan questions.  Tell them Tia sent you. 😀

Transcript

Speaker 1: 0:01

Hi friends, it's Tia Moore here with NextView Podcast. Thank you for tuning in for your November, 2019 market update. I have so much to share for you, however I will condense it in less than 10 minutes-I promise. All right, so this is going to be the 10 minutes that you're gonna thank me for later because the information contained in this podcast will have you equipped and ready to handle any awkward conversation or any interaction you have with somebody at maybe a dinner party that you're forced to go to later this month, LOL! Alright, so let's get into it. I'm g oing t o give you a general overall market overview. Then I'm going to discuss what that information means. If you are a buyer in this market, I'll go over what that information means for you. If you are a seller in this market, we'll talk about how new home permits are affecting our market and I have a fun fact courtesy of our friends over at t he Oliver Wayland team at Nova home loans. It is a great new change to FHA lending guidelines and I'm sure you guys would want to know about, especially if you are a buyer, thinking about using an FHA loan or if you are a seller that selling within an FHA price point. So let's get started. Alright, so active listings for sale. Right now we're at 14,403 listings. That is down 21% from where we were last year. Okay, I'm going to explain all of this and further details. So stay with me. Okay. Listings under contract currently are up just on just at 19% so 10,097 listings currently under contract up 19% the monthly median sales price, we're at 283,000 which is 8% higher. Let me repeat that. 8% higher than where we were in November of last year. So let's talk about what that means to you. If you are a current buyer. So perhaps you're a buyer and you've been waiting to purchase because you've been hoping that the prices go down. Well, unfortunately, 2019 has probably been a disappointment for you if that was the case, because prices have continuously risen, the average sale price per square foot has increased almost 7% since last November. And the median sales price, like I said earlier, it's currently at 283,000. That is an increase of 21,000 compared to last November when we measured at about 262,000. So I know I've had people say, well, how long can this last? People can't afford to purchase homes. What are we doing? Well, despite the rising prices, you know, affordability has remained normal throughout the year. And one of those factors is because private sector earnings in the greater Phoenix area has risen by about 4.5%. And that's courtesy of our friends over at the Cromford report. And then not only that, you have, you have interest rates that have continued to decline. So you have income rising at about four and a percent. And then you have, interest rates declining right now, according to, the homeowner index published by the national association of home builders and Wells Fargo, the median family income was measured at 72,900 last quarter, and that family is making that income, could afford about 68% of what was sold last quarter. So about just under 70% of all the homes that were sold in the last three months. It was affordable for about, um, it was affordable. If the income was about 72,000, 900, so 68% of those families could afford a home. All right? Historically that the normal range is between 60 to 75%. So we're, we're well within that range at about 68%. Alright? So obviously not all buyers have stayed on the fence. We've had a lot of buyers purchasing homes. That's why we've seen an increase in homes that are under contract despite the competition. Because at the end of the day, everybody needs to have somewhere to live and people are looking to make their home life the most, the most practical. And the most comfortable possible, right? So if you're, if you're a buyer in this market, do not get discouraged. It may be a good time for you to buy it depending on your specific, your personal specific situation. Um, and based on what you can get as far as an interest rate and pricing and payments and that and so forth. Contact my team at next few home professionals, um, by sending us a text at(480) 281-3078 and we're happy to have an individual consultation with you to see if it's a good option for you at this time. The nice thing about us is that we are a very low pressure and we just want to give as much information as possible so that you can make the best decision for yourself. So give us a call, send us a text and let us know. All right, let's talk about seller. So sellers, you were probably thinking, Oh my gosh, listings are down 21% contracts are up almost 19% and um, you know, home sale, home prices have risen by an average of 8%. If you're at least that to, you know, if you're around that$283k median or below. So you're probably thinking, well I could list my house and sell it for whatever I want to and I'll get that price because there's nothing else on the market. All right, I hope you're not thinking of that because if you're thinking that way, you are wrong. All right? So what that means is if you have a product, in this case, your house that is marketable and its, which means it is in good condition, you know, it doesn't have any major problems, it will attract buyers. And if the other part of that is you need to be priced fairly. So if you're priced within the market, you will see activity, you will see offers, you will see showings and ultimately that's what you want. So or you'll see showings. And ultimately those things lead to offers if you're priced well and if your home is in good condition. So again, while there is, there is an increase in demand due to um, lower listings on the market and home prices rising. That does not mean you can list for an astronomical amount above as above, um, above market value. The other thing to that to always remember is that house will also need to appraise. So that's, you know, that's a whole different story. All right, so like I said before, we did have a decline in, or I may not have said it, I'm sorry. We did have a decline in our listings under contract compared to where we were in may, may was our peak month, and then they declined by about 26%. However, it's still about 19% higher than where we were last year. So you're probably like, well, what does that mean? Why could it rise 20 S why could it decline 26% we're still higher. We just had a very strong, um, you know, February, March, April, may. It's a very strong contract month for April, and ultimately in made those con, you know, those contracts are closing. So that's one of the reasons. Uh, then you also have monthly sales being up about 15%. That's, that's truly a solid indicator that we're going to have a really great end of the year. At the end of the year. A lot of people don't list their homes because they want to focus on the holidays. You may have family visiting, you want to decorate for Christmas or um, you just, you want to get into the holiday spirit and maybe you want to do shots, whatever the case may be, you may not want to go through the process of selling a home. And so a lot of times you see listings declined. However, those are good months to sell. Usually during those months. People who are very serious, if they're shopping for homes during those holiday months, um, we tend to have a lot of people relocating during those months because they start their new positions in January. So they usually have a report date of right after the first of the year. So if you, you know, if you are thinking it may be a great time because you'll have less competition on the market. And like I mentioned before, if you have a home that's in good condition and you're willing to price it right, it could be a huge opportunity for you. Sometimes sellers will get nervous and they'll price their homes and very low so that at those times buyers can take advantage of it based on what it looks like this year it looks like we're going to have a strong sale. So I'm not sure that's going to be the best strategy if, if you're waiting, but you know, it's always good to get the process started now. And that way if a good deal comes on the market that a buyer sees, go ahead and jump on it. All right, so going back to home sellers. Okay, so like I said before, contracts are up. Um, listings are down, so not a lot of listings on the market. If you are thinking of selling and you want to maximize what you get out of your, um, out of the sale of your house, give us a phone call because you want to start this process. Now we're going into an election year and it's always unpredictable when we do that. So I mentioned, I would talk a little bit about new home construction. So single family permits, which is an indicator of our future supply, right? We're up about 4.6% year to date and multifamily, which is condos. Townhouses are up about 6.4% which is, we haven't reached that level since 2007 so again, multifamily permits up to 6.4% single family permits up 4.6 again, haven't reached those levels since 2007 now, here's the thing, single family home sales are up by 5.7% however, and we're, and we're referring to new homes, guys, new homes, but townhomes and condo sales that are built brand new, they're actually down 30% so with that being said, resale condos and town homes have actually increased in sales volume as we've seen, as we've seen in new construction, townhomes, townhomes and condos drop. So if you are thinking about selling your condo or your town home and it's not a brand new build and, or it's not an unbrand new development, that's great news for you. The person that, that it's bad news for is if you own a condo and you're thinking about renting it, that's going to be a challenge because with more people purchasing it, more people are looking for renters. So you're having to drop your rent a little bit less and throw it. It's T it's, it's decreased by about 1%. If you're trying to rent a condo, um, if you're trying to rent one of your condos right now. All right, so that's the end of our market update. We talked about, we talked, we gave you a market overview. Um, I talked about what the market means if you're a buyer, what the market means if you're a seller. Um, and I, we talked about this new construction and what's happening with that now, I didn't mention it, but sellers, anytime you want, you can have a free market analysis. We have a system called home bot. It's, you can sign up for it whenever time you want. It's called my AC home bot and so M, Y a, Z, H O M E B O t.com. And you can sign up on that website and it'll send you a monthly report of what is happening in your neighborhood. And if you are a buyer, you can also sign up for that based on areas that you want to keep track of. So it's, it's a great tool for that. All right. So my friends at Nova home loan sent me some information recently and I think it's great for some FHA for some FHA buyers. So the, the, the T the information said great news for potential home buyers with variable income. FHA recently announced that they will now allow a 12 month history for receiving commissions, bonuses, overtimes and tips. This is reduced from the prior requirement of 24 month history. Can you guys believe that? So it's been 24 months for quite awhile and it's, it has taken people out of the ability to use an FHA loan to purchase a home. And now that is no longer an so. If you were previously declined for FHA financing for using 12 you know, because you're a commissioned employee or you receive bonuses and tips, be sure to contact Justin and Ryan over at Nova home loans. They can be reached over at(480) 233-5816 if you want to have that conversation with them and get pre-qualifying, just let them know that TM or from next view home professional sent you. All right guys, that's it for this week. Be sure to tune in every week for next few podcasts for everything you want to know about real estate and business. I'll talk to you soon. Thanks.