Historically, the real estate market in Arizona cools down in December and heats back up January through May. This December was no different.
We are BACK TO BALANCE! In November we fell into a full-blown buyer’s market and stayed there for a few weeks. The Cromford Market Report notes the market has shown strong signs of recovery and we are now in a balanced market that is neutral to both buyers and sellers.
However, buyer demand is heating up and if this continues, the pendulum could swing back in favor of sellers during the typical Arizona selling season this spring.
- The shift from a buyer’s market to a balanced market is noticeable with the number of price reductions in December being the lowest amount since May.
- Nearly half of all transactions in December had the seller paying a portion of the buyer’s closing cost with the median amount coming in around $9,300.
- Median sales price in Gilbert dropped slightly over November and was just about flat to December 2021.
- The rapid rise in inventory levels we saw in the summer/fall months tapered off in December falling 20% from October.
- Homes in Gilbert are taking 20% longer to sell than they did last month and a whopping 131% longer than they did last year.
- Since most leases are 6-12 months, rent prices are a lagging indicator of change in the market. We are now starting to see median rent prices decline slightly. For a 1,500 sq ft rental home, prices went from $2,010 in December 2021, up to $2,100 in August of 2022, and down to $1,965 in December 2022.
- Foreclosures could indicate a major shift in the market so we’re keeping a close eye on those. As of now, foreclosures are still well below pre-pandemic levels.
So, what does this mean for you if you are looking to buy or sell a home in the near future?
Buyers currently have very little competition. If you are planning to make a purchase in the near future, you may want to start the process before the selling season picks up at the end of January. This may give you more time to view properties, less competition when submitting an offer, and more leverage when negotiating.
If you are planning to sell your home in the near future, I would recommend getting it ready to list now and having it on market between January and March to give it time to be exposed during our biggest selling season of the year. Historically, 25% more homes sell between April and June than in the summer and winter months. If you’re thinking about selling your home, contact me and I’m happy to discuss the process or even provide a complimentary market analysis to see what your home may be worth.