A Busy Start To The New Year For Front Porch Properties

The month of January has been action packed for us. I was quoted in the real estate column of the Arizona Republic on Saturday, January 25th giving my professional opinion on housing market, we rented and sold quite a few homes, and we are continuing to find wonderful guests (you know them as tenants) for our investment homes.

As we see below in my monthly update, the real estate market is slowing down from the exuberance of the past twenty four months.  This is a good thing because rapid appreciation cannot be sustained and will lend itself towards another rapid decline.  My explanation for the softening of the current real estate market was my belief that today’s buyers are much pickier than they have been in the past – buyers don’t want to make the same mistake that they did in the past.The month of December was a much busier month in the Phoenix real estate market than November.  We closed on 5,969 properties in the Phoenix Metro area, that is an increase of 14.7% while being 15.6% lower from the same period last year.New inventory slowed dramatically by 22.4% to 6,066 properties.  As a result, total inventory changed very little; at the end of December the number of properties for sale was down 5.5% from November listings with 25,360 homes for sale.  This is an increase of 20.2% over last year.  With sales up and homes listed for sale down we dropped back to 4.25 Months Supply of Inventory.  We also have a reduction in the number of homes “Under Contract but Accepting Back-up Offers”; down to 9% of the active inventory.  Pending Foreclosures in the Phoenix Metro Area are also continuing to drop, last month we hit a new low of 5,974, a reduction of 1.5% over last month and 48.7% over the past twelve months.

Home prices jumped up in December.  The average sales price hit $247,000, an increase of 16.9% in the last twelve months.  The Days on Market inched up eight days to 72, one day more than last December.  One increase creates the other

I believe all of this information points to a soft landing for the Phoenix Real Estate Market.  This is ideal news since we don’t want a repeat of the crazy roller coaster ride we have been on for the last eight years.  Although the severe winter season brought on by the “Polar Vortex” may create more families heading west to escape the extreme cold temperatures.   Increase in population will translate into greater demand that eventually leads to higher prices – in both rent and sales.  We can always hope.

“Now is a great time to own real estate in Phoenix!”