To Buy or Not to Buy?
To buy or not to buy. That is the question. Whether ‘tis nobler in the mind to suffer the slings and arrows of outrageous media hype, or take arms against a sea of troubles, and by opposing end them?
I doubt that if Shakespeare were a Realtor that he would have penned his words this way, but I'll take the liberty.
We have commented many times before on what we, the humble Realtors think the market is doing, has done and will do in the future. Many try to consult the crystal ball, some look at the tea leaves and some use statistics. When will it ever end? We have bemoaned the notorious negative spin that the press has given this topic, especially here locally in the AZ Republic. Today there was another article that actually surprised me. The headline was typical, sounding like another negative spin, but much of the text showed the outlook as positive. I can't locate the link currently, so I'll summarize what my thoughts on it. The analysis stated that we probably haven't bottomed out yet, but that we are just about there. The turn around is expected in the spring, and once that occurs, the outlook is appreciation again. The statement included an estimate of 5-8% appreciation annually. Hmmm, does anyone remember what the market was like before all the craziness of 2004-2005? Yup, most areas of the Valley of the Sun were appreciating 5-8%, with some areas, particularly in Scottsdale, exceed most others.
There are numerous articles lately on both sides. Like I stated at the top, to buy or not to buy?! An interesting aspect to some articles published in the AZ Republic, is they allow reader comments to be posted. There was an article last week giving stories about the unfortunate souls whose homes were sitting on the market. Once again, negative title, (and story) but reading the article showed the truth about the examples they used. In two simple terms, these sellers were greedy and/or not well informed. We have blogged in detail in the past about how important it is to price the home properly, and about how to not get caught up in what the market was but what it is. The comments from readers mostly pointed out the faults of the sellers, while the few that always seem to bash real estate agents again made their views known with the usual bluster. In some ways we understand those views, but we've ranted on that before.
The nation as a whole has suffered a downturn in the real estate market. But people need to realize that national statistics due not represent local markets. The Phoenix area had the highest percent appreciation in the country during the insane year. Now as the market corrects, we are still ahead of where we would have been if we had seen the same 5-8% appreciation and people are crying about it. The market corrected. It was due, and it really wasn't that bad. Inventory is down, but still above average, and as the public realizes that we have pretty much stabilized, that inventory will continue to reduce to normal levels. One key point in the first article I mentioned stated that we are seeing new home permit levels that project 35,000-40,000 homes this year. Is that really a down market? Sure we hit records well over 60K permits a couple of years ago, but I remember when people were amazed in the late 90's and early in this decade when the levels kept creeping up, and people were stunned that we hit 35,000 new homes in one year. Now they're crying? Reality check!!
I found a post on Technorati of a blog in San Diego that posted an article about investing in real estate. It sourced info from RIS Media from December and specifically covered the Phoenix market. It is a worthwhile article to read. Simply put, if the investors are high on the market, the public will eventually catch on. The general investing public has the sense that we have hit bottom already. So what are we waiting for?!
Once again we will state our thoughts on the Phoenix real estate market. Inventory is down, builders are not offering as many of the huge incentives they were a few months ago, interest rates are still phenomenal, job growth is still strong, and regardless of whether all of those factors were in place or not, people are moving here and will continue to move here for all that the area has to offer. Arizona is now the fastest growing state in the country. If things were so bad here, how could that be?
Adam Tarr, ePro
Sharon Kotula, ABR
Your Phoenix Area Real Estate Source
RE/MAX Excalibur
Scottsdale, AZ
480-483-3333
info@WeAreAZRealEstate.com