It has been an interesting three years of riding the pandemic real estate market roller coaster.
The craziness in the market was fueled over the last few years by the uncertainty of the pandemic, expanded work-from-home opportunities, low interest rates, and strong stock and cryptocurrency gains. Then 2022 came along and it may be best described as the last hours of a crazy party followed by a rough hangover.
As we enter 2023, it feels more like we just finished a juice cleanse and are ready for a fresh start. On Jan. 9 of this year, the switch flipped and the market took a palpable turn. Buyers started to return to the marketplace, showings increased, and multiple offers even returned on some properties. We believe we have passed the bottom of the housing market and are moving forward once again.
Why are things improving? We believe that stability is the real reason. We are seeing mortgage rate stability, a slowing of inflation, and a strong job market. The other big story is that our real estate inventory remains low, both locally and nationally. Low inventory is what is keeping the balance and helping keep home values stable even though rates are higher and demand is less than it was during 2021-2022.
That brings us back to our question: Are we in a buyer’s market or a seller’s market?
The answer is that we are simultaneously in both. Sellers have an advantage if they have the type of product that is in demand and priced correctly. The homes that are selling with multiple offers have the fewest defects (i.e. don’t back to a street or power lines), are well-maintained, are in a desirable location, have been updated (or at a minimum are super clean), and are well presented.
However, when properties have challenges, sellers must be realistic. Buyers are not looking to overpay for defects, deferred maintenance, or drab interiors, and they are willing to walk away when homes don’t meet their expectations for condition and value.
Buyers in this market have the advantage because demand has slowed. They have more room to negotiate pricing, concessions, contingencies, and repairs and they have a better chance of getting more of the items on their homebuying wish list. They also have more time to make decisions, and because of this, they are generally more selective. But like sellers, buyers need to know the market. The perfect house is still going to sell quickly and for top pricing.
If you are buying or selling in today’s market, we are here to make sure you know the market nuances of the moment. The market is changing weekly and with our decades of experience, we can help you navigate your way to the best opportunities.
Good old-fashioned expertise, no gimmicks, and a mission to help our clients have the best buying or selling experience possible — this is why our family has been successful in residential real estate in Mesa for 50 years. We are here to help!
John and Natascha Karadsheh are co-owners of KOR Properties, a boutique real estate brokerage serving the Valley of the Sun.
John is the Designated Broker of KOR Properties and has been a Multi-Million Dollar producing agent for over 20 years. He is an Accredited Buyers Representative (ABR) and Certified Residential Specialist (CRS), and serves on the Arizona Regional MLS (ARMLS) Rules & Policies Committee, ARMLS Appeals Committee, and the West and Southeast Realtors of the Valley Professional Standards Committee.
Natascha is a Multi-Million Dollar Producer and Accredited Buyers Representative (ABR). She is the Founder of Mesa Food Truck Fridays, a Member and Past-Chair of the City of Mesa Economic Development Advisory Board, and on the Board of Directors of the Greater Phoenix Economic Council.