After reading the Wall Street Journal's "The Housing Crisis is Over" by Cyril Moulle-Berteaux, the whole real estate community is excited at the prospect of being over the worst of the crash. All the economic indicators point to a market that has bottomed out and is on track to be on the way back up. After all, we're seeing a reduction in inventory over the past several months, and less inventory will lead to a better ratio of sales to homes on the market, which will lead to a better market, right? I mostly agree with that, and would completely agree with it if we were under different circumstances. It's always good to have less inventory on the market than we've had over the past year and a half. 50,000 homes in the Phoenix area is just too much. Especially when you're only selling 3,000 in a month (general figure for AZ MLS).
However, We are still seeing a reduciton in home values, and I don't see that ending any time soon with the volume of foreclosures flooding the market with bank owned properties and short sale listings. As a market, we need to flush these out types of properties before we will see values stabalize and rebound. Right now, listings agents keep slashing prices to get quick offers, just so the banks can deal with the values. This is causing a trickle effect that keeps pushing values down. From the looks of things, this could still take some time depending on how our government handles the "crisis". Either way, it's a great time for buyers and should be so for awhile. Homes are finally affordable in the Phoenix area again, and all types of buyers should be able to get into something that won't bankrupt them the way the escalation of home values during the boom did. This is such an interesting topic, there is surely more to come.
Thanks for Listening,
Arcadia, Tempe, Scottsdale, Central Phoenix Real Estate