Inventory of Homes for Sale in the Greater Phoenix Area
April 20, 2018
Homebuyers all across the greater Phoenix area are certainly feeling the effects of today’s “seller’s market.” A shortage of supply in Phoenix real estate has been around for some time now, with inventory continuing to fall on a yearly basis. We are now at a point where there are very few homes available, both new builds and resale homes alike. This is especially true for properties that are priced around $200,000. Now the obvious question here is why.
There’s plenty of speculation as to what’s caused our inventory to drop so low, and realistically there could be one or multiple reasons. Most notably, however, is the financial crisis of 2007-2008, which greatly impacted the US housing market. There are several lasting effects from 2008’s market crash that could be in play in today’s inventory shortage.
1. Homebuilders were forced to cut back on producing more inventory when the housing bubble popped. Only recently have we started to recover from this disruption.
2. Many people experienced financial hardships during this time, and their credit was adversely affected. Damage to your credit score takes time to recover from, and these people are now just starting to bounce back.
3. When the market crashed, interest rates declined drastically. Homeowners who purchased real estate during this time are holding on to their properties because they benefit from such a low interest rate on their mortgages.
In addition, the millennial generation is now reaching an age where they are participating in buying real estate. Therefore, there is a new influx of first time homeowners, while our market is still in recovery from the financial crisis of 2007-2008. It is likely that the prices will continue to rise for a while, and if are thinking about buying a home in the near future, it may save you a lot of money to do so sooner rather than later!
We’re looking forward to hearing from you soon!