Housing Market Update April 2020

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Hi, I'm Diana Benson here with your market update for April 2020. Let's see what's happening. Right now there are about 18,000 listings. This is up by a couple thousand from last month. Last year at this time there were 23,000 listings. So we're still quite a bit lower than we were about a year ago. Currently, there are 5900 pending sales. That's down by a couple thousand. So far there were 8500 sales for the month. This is an increase from a month ago. But this reflects the activity from a prior month that actually just closed this month. So far there's been 101,000 sales for the year. This is quite a bit higher than last year at this time with only 93,000 sales and there's a two-month supply. You can see that two months of supply has been pretty steady over the last year. Six months is a typical inventory for a normal market. So that means we're still in a seller's market. So what is happening? Well, some buyers are delaying their plans but sellers are retaining their values. They're not making a permanent decision on this temporary situation. So that's really good news. But the investors have stopped buying. The "i-buyers", (who pay cash for your home) have stopped purchasing. In fact, many of those offers that were on the table had been canceled. Whether you're renting or you're buying, there's plenty of assistance out there. In fact go to the website, knowyouroptions.com/covid19assistance. This site will provide information for help with both your mortgage or if you are renting. One option is forbearance, which means putting off making your payments, also available is deferment. But make sure you talk to your lender before you miss a payment. You have to go through the program in order to get the assistance, don't just stop making your payment. Otherwise, they can foreclose. You need to know what repayment options are available. Many times you can delay payments for three months. But on the fourth month all three months, plus your 4th months is due all at once. So, do your due diligence! Why is the market still a seller's market? One reason is that we are still affordable. If you look back over history, for instance, back in 2005 when things were going crazy and people were just buying houses left and right, You'll see that the affordable index was down at 26. The normal range is right from 60 to 75. This is based on is how much housing cost, typical salaries are, and the cost of living. Back in 2011-12 (when the market was hitting the bottom), the affordable index was 86. So, we are in the normal range. And what about the supply? We talked about it a little bit already. It is down from last year. In fact, anywhere from 25 to 42 percent lower than last year. It has increased a lot in the last three weeks, however. As you can see, the different price ranges anywhere from 3% lower to 51 percent. It really varies in the different parts of the Valley. As you can see in the Southeast Valley, there is a 45 percent increase in the inventory in the last three weeks. That's still down 25 percent from last year. So sellers are still selling. The new listings coming on the market have slowed from last week. Last week is when the announcement came that were going to continue our social distancing until the end of the month. It appears there was a little bit of a panic feeling from some people and they started deciding to put off the sale or purchase of a home for a little while The number of homes that went under contract has also slowed. All of a sudden, there is a big dip. But let's keep it in perspective. We can see that i-buyers are slowing down or even backing out of their contracts, as mentioned earlier. In fact, 50% of all the sales that are falling out of escrow are i-buyers backing out of the contract. So why are some of the other contracts falling out of escrow other than the i-buyers? In some cases, the borrower's lost their jobs and they can no longer qualify for their home. They need to put things on hold before they reenter the market. Can you imagine all this built up demand? Once everybody comes back into the market and they're back from their furloughs, the housing market could really go crazy But not all price ranges are created equal. Here shows a graph of condominiums from 400,000 to 600,000. Not only are the people backing out of the contracts but look at the number of offers. There are only 11 offers. What should you do now? First, it's more important than ever to consult with a real estate professional. So if you just have some questions about the market feel free to call or text me at 480-226-1925. Or if you'd like to book a consultation, go ahead and click the CALENDLY link here, to set up a consultation. Diana L Benson eXp Realty 480-226-1925 DianaBenson@cox.net

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