The Arizona Regional Multiple Listing Service reported that June was a record setting month for the volume of homes sold and the total dollar volume of residential real estate transacted.
The monthly median home price set a new, all-time high in May at $278,000, and then broke records in June again at $279,900.
What a difference from the last quarter of 2018 when the market was sluggish at best. The over one percent reduction in interest rates and strong local job market have continued to fuel rapid growth.
As we see every summer, more and more people are relocating to the Valley. Over half of our transactions in May and June involved an out-of-state relocation. The strong local economy and favorable tax environment all continue to attract new homebuyers to our market.
With that demand, average sales prices are up 5.1 percent year-over-year and housing inventory has dropped significantly in the last three months to the lowest point in the last 10 years. Home builders also continue to move as fast as they can and they are still struggling to meet demand.
While the growth in the Valley and low unemployment have continued to contribute to strong housing numbers, a June 2019 report by Freddie Mac titled, Are Baby Boomers the Key to the Single-Family Market?, demonstrates that 55+ homeowners are having a multi-faceted impact on housing inventory as well.
“Baby Boomers and other homeowners over the age of 55 control almost two thirds of the nation’s home equity – about $8 trillion. There are also more than 67 million 55+ homeowners. Whether they decide to move from their current homes or age in place, the cumulative impact of their decisions on mortgage demand, affordable housing supplies, and the housing options available to Millennials and other aspiring homeowners will be substantial.
Sixty-three percent of 55+ers prefer to age in place. This works out to an estimated 42 million homeowners who don’t plan to move. Twenty-seven million 55+ers would prefer to move at least one more time. Although movers are in the minority, it’s a big minority. According to the survey, nearly 40 percent of all homeowners 55+ would like to move at least once more.
This isn’t just about downsizing to a rental or nursing home; 19 million plan to buy a home and nearly 8 million expect to move within the next four years. What’s more, half of the 19 million likely movers expect to buy less expensive homes. These are big numbers with the potential to tighten home buying competition in the housing market, especially for Millennials and other first-time homebuyers.”
If you are thinking of selling, give us a call and we can help you start to gather information about your home’s value and marketability in today’s real estate environment. Remodeled properties continue to command strong interest, and homes under $300,000 remain in highest demand.
The luxury market remains a slower segment. There continue to be micro markets that are in higher demand than others, so knowing how to best position your listing is important. Give us a call to get all the facts and let us help you build a strategy for your next move.
John Karadsheh is the Designated Broker for KOR Properties. He has been a Multi-Million Dollar producing agent for more than 16 years and is an Accredited Buyers Representative (ABR) and Certified Residential Specialist (CRS). In 2014, John was voted the No. 1 Real Estate Agent in Arizona by Ranking Arizona. You can reach John at (480) 568-8684, or visit his website at KORproperties.com.
KOR Properties is a boutique real estate brokerage serving the Valley of the Sun and the creator and founding sponsor of Mesa Food Truck Fridays.