Metro Phoenix Housing: Homebuyer Revival Transforms Market

by Bob Richards on October 29, 2013 · 0 comments

in Market News

In a good sign of the times, real-estate agents are predicting a proliferation of for-sale signs on front lawns.

The metro Phoenix housing market is shifting away from investors for the first time since the market crash, leaving more properties available for traditional buyers. And the market appears neither overstressed nor overheated, heading instead toward a more natural balance.

Thousands of prospective sellers, once worried about losing money on their houses, have listed their properties after seeing prices skyrocket over the past two years.

More buyers, outbid multiple times by investors in the spring, have been able to sign contracts recently. Also working in buyers’ favor are mortgage interest rates, which are falling again after a brief summer jump.

The number of foreclosures and short sales has dropped dramatically, meaning fewer bargain-hungry big investors are in the market looking to pay cash for Valley properties.

The investors played a role in the market’s early recovery: When prices hit bottom in 2011, an investor buying spree created a short supply of affordable homes for sale and sparked a 65 percent jump in the region’s median home-sales price over the past 24 months.

Now, the fast run-up in prices is actually spurring sales. Even as investors have exited the market because higher prices equate to less profit for them, more traditional buyers are anxious to purchase houses before prices and interest rates climb too high.

If no unexpected jolts occur, real-estate analysts expect more properties to go on the market. Resale prices are expected to continue to rise, but at a slower rate because of the expanded number of listings.

The Valley’s median sales price has climbed 30 percent so far this year, and home values are up in every neighborhood across metro Phoenix, according to The Arizona Republic’s fall Valley Home Values special report.

Most areas in the region have experienced double-digit increases in home prices so far this year, and a few spots have seen values return to boom levels, according to The Republic’s analysis of data provided by Information Market, a real-estate data firm owned by the Arizona Regional Multiple Listing Service.

“The housing market has been crazy for people trying to purchase before houses get too expensive,” said Yamile Hirsh, a real-estate agent with HomeSmart. “But it’s finally getting better for buyers because more homeowners have equity now and can sell.”

This article was originally published at AZ Central. Read the full article here.

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