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Record Home Inventories in Arizona....

By
Real Estate Agent with Call Realty, Inc.

Record Home Inventories in Arizona....
by Kaushik Sirkar, Chandler REALTOR®
Chandler AZ Real Estate

For those who are/were unaware, the inventory of homes for sale in Arizona really began to spike up around late spring of 06', suddenly shooting up to more than 40,000 homes for sale.  We have remained well above 40k in inventory even during the winter months where there were fewer new listings and various other listings were taken off the market.  Fast forward a few months - we've hit a new record.  There are over 50,000 homes for sale in Arizona.  To give you an idea of how strong a Buyer's Market this supposedly is, a 'normal' market has about half that level of inventory.  During the boom of late 04' through ~ 9/06, inventory dipped down to a few thousand.

Read this article from today's Arizona Republic.  There are various reasons for these record inventories which I'll highlight below.

  • Unrealistic Sellers - Folks want to list their homes for MORE than what the neighbors got - over a year ago!  Sellers must understand that the market dynamics have changed greatly and adjust their expectations accordingly!
  • Investors want profits - There is no doubt that a huge factor driving the recent boom in AZ (for that matter, national) Real Estate was investor based speculation.  Many of these investos would like to see their profits and are putting their homes up for sale.
  • Seasonal/Cyclical - Its springtime.  This is the time of year folks traditionally put their homes on the market. 

Combine these three items - unreasonable expectations, investors flooding the market and seasonal adjustments - and one begins to understand why we have soooooo much inventory.

Are you a seller in this market?  Do you absolutely NEED to sell?  Well you must price your home AGGRESSIVELY.  Just want to see what your home might fetch?  Wrong market to go fishing.....  For the buyers out there, you have never had this much selection before in the AZ Real Estate market.  You can really choose the perfect home for you.....

Thanks for Reading :)

Kaushik Sirkar, Chandler Realtor®
http://www.homesphx.com

Renée Donohue~Home Photography
Savvy Home Pix - Allegan, MI
Western Michigan Real Estate Photographer
Kaushik:  Same here same here!  Great way to educate the public about what is going on!
Apr 09, 2007 08:24 AM
Kaushik Sirkar
Call Realty, Inc. - Chandler, AZ
Renee - We are like twins.  NO, not you and I, our respective cities :)
Apr 09, 2007 08:27 AM
Michael Krotchie
Tierra Antigua Realty, LLC - Tucson, AZ
Tucson Realtor, 520.261.MIKE
Kaushik - How much impact has the rise in inventory actually had on home sales in the Phoenix area? Is there less volume of sales, lower prices, or both?
Apr 09, 2007 09:41 AM
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert
Kaushik, I had heard from a friend that already that there were a lot of houses for sale out there in AR, and that it was a great time to buy the house of your dreams with so many to pick from and the prices becoming more attractive.
Apr 09, 2007 11:55 AM
Kaushik Sirkar
Call Realty, Inc. - Chandler, AZ

Michael - Home sales are currently chugging along just below 2003 levels, aka levels before the craziness.  The volume is obviously much lower than in 04 and 05.  Prices lower...not so much.  Median sales price is still hovering at about 250k, which is lower than the peak of ~ 265k we achieved.  But that 265k number is somewhat of an anomaly.  250k has become relatively consistent post boom.  Its really just a matter of a huge inventory spike!

George - The selection is ridiculous right now.  I tell all my clients thinking about purchasing - pick the perfect home for you.  Then we'll start hammering and get it at the 'right' price....

Apr 10, 2007 11:06 AM
Brian Brady
Matthews Capital Markets - Tampa, FL
858-699-4590
There's a 10 month inventory in Maricopa County.  Sellers need to realize that they need to be priced below 7-9 of the model matches in the neighborhood if they want to close.
Apr 15, 2007 05:42 PM
Kaushik Sirkar
Call Realty, Inc. - Chandler, AZ
Brian - Thats pretty much what I tell my prospective sellers (and back it up with plenty of data).  Some people just have a hard time accepting their home is woth X $ less than it was just one year ago....
Apr 15, 2007 07:21 PM