Today’s housing market may be a little scary for some of us. The terror and twists over the past eleven years may have made us feel like we entered a house of horrors.
After the frightful economic downturn in 2008, in which the banks sucked the life out of home owners, home values dived 6.1% annually until February 2012. From March 2012 to today, the market has been recovering with values appreciating 6.2% annually. In a normal real estate market, home prices appreciate 3.7% annually. At least that is what the soothsayers say.
Back in 2006 the average home price for a 1,900 square foot home was $310,000. Today the average home price for that same home is $277,000.
The mortgage rate in 2006 was around 6.6% (yikes!) for a primary residence. Today the rate is below 5% (depending on credit and program).
The trick is the inventory. A normal market has 4 to 6 months of inventory. The average inventory in most areas of Maricopa and Pinal County is 2 months. Potential sellers are not wanting to let go of their 3% interest rates.
People always have a reason to sell. The home is too big, too small, not in the right area or families just want something different.
Sellers will eventually come out of their zombie trance and, like the song says, let go of their interest rates and homes.
The treat for our housing market is that we live in Arizona. The weather is spectacular, our economy is booming, and the people are awesome.
Don’t forget about the free flying lessons, BYOB. Bring your own broom.