The local markets I serve, Litchfield Park, Goodyear, Avondale, Surprise and Glendale, Arizona (West Valley Phoenix) have been some of the hardest hit areas in the nation. Many of our local communities have witnessed price drops in excess of 50% from 2004-2008. I field calls almost daily from homeowners who purchased a property in 2004-2005 and who are now more than 200% upside down! Dealing with sellers in this market has been depressing and difficult, and like many of you I have been longing to feel good about my market again.
However, recently things have started to "seem" different. Maybe it's just me, or maybe it's just my local market, but the last 30 days has begun to "feel" like productive real estate activity is picking up. I can't exactly put my finger on why I feel this way, but there are a bunch of silly little things I've noticed recently like regularly running into other agents with their clients at listings, or the number of business cards left on coffee tables.
Sure, I could point to a lot of recent positive statistics about home resales, low interest rates, and government stimulus programs. Or I could discuss the fact that most bank owned homes receive multiple offers in a week, and how it's becoming more common to see sold prices in excess of list prices on CMAs. Those are tangible proof of a bottom, right?
But I could also point to the wave of foreclosures on the horizon, the continuing international financial crisis, rising unemployment, blighted communities abandoned by developers...yada, yada, yada. Or I could just post a video about a former Wall Street executive delivering pizzas or driving a cab.
But whatever the numbers, my gut is telling me something has changed. I believe in the idea that demand for residential real estate ownership is relatively constant, and that affordability and population demographics are the biggest drivers of appreciation. So perhaps when I see school bus drivers and Wal Mart employees buying homes that senior executives could barely afford 3 years ago, it sparks my instincts? Or maybe I remember commuter cities in Southern California during the mid 1990's when similar signs pointed to a recovery in those markets that had been decimated?
Or could it be that I just want to believe so badly that things are getting better that I have exaggerated little positive signs into macro economic indicators?
So which is it? Has the real estate market finally reached a bottom? Is it beginning to level off? Or am I crazy and we are still skiing down a steep slope?
Then again, maybe I should stop worrying about it and just get back to work. I have a multiple offer situation to deal with on a bank owned home that just came on the market yesterday...
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