What's Happening in Flagstaff Housing?

What is Happening? In the Flagstaff Housing

A lot is happening in Housing in Flagstaff!

I get asked on a daily basis, what is actually happening? In Real Estate today.

There are no simple answers but there are some facts that can help give us some direction in what is Happening?

With that, I went back 11 years in Real Estate to 2010, then came forward year by year. For the most part figures will be through November each year unless otherwise noted. So back in 2010, We sold 787 homes or -9.6 % fewer than the year before. At that time, we had 908 homes on the market down -2% from the year before Our Median Price on all homes, Single family, Townhome, Condo, and Manufactured, was $225,000 down -10% for the full year The Most Telling, our Absorption Rate, (the number of months (using average home sales volume) to sell every month on the market), was 12.37 months, over a year! TODAY, 1.7 months

The Absorption Rate is one of the best numbers to use to gauge a healthy market. Experts in Real Estate feel 6 months is healthy, more and it is a Buyer’s Market, less and a Seller’s Market.
Let’s look at every year since 2010

2010---12.37 months’ supply on-hand, this is more than a year’s supply
2011---9.96
2012---6.35
2013---5.79
2014---5.37
2015---4.43
2016---3.82
2017---4.08
2018---4.06
2019---4.40
2020---1.7 month’s supply on-hand, just under 2 months, Hard to say if we have ever been at this figure.

It has been 8 years since we have been at a Balanced Market or 6 months’ supply on hand.
Over the past 11 years, the supply of homes has only increased 2 years from the previous year.

More telling,

Thru November of this year, 2020
We have sold 1738 homes or 24.2% MORE homes than 2019
Year to date through December 6th, we have had 15 more homes come to the market then last year.
Our Median price again thru December 6, 2020 is at $410,000 or a 10.8% increase for all home types, Single Family, Townhome, Condo and Manufactured.

One thing we hear, fewer homes are coming to the Market, but the FACTS just do not show this to be true. It is close but still a positive number.

So what has happened,
Here is what we do know.

• We have had a declining availability of homes 8 of the past 10 years.
•  On top of that, interest rates today are at historic low Levels, giving buyers more buying power than they ever had.
• New Construction came to almost a halt from about 2007 through 2015
• Older Homeowners that normally downsized have not been able to find that smaller home for one reason or another, so have stayed put.
•  Covid-19 did slow people down from putting their homes on the market.
• We have a tremendous backlog of Buyers looking for that right home, could be the largest backlog we have seen in years, at least 11.

With all these points, am not sure we can point to any one reason as to how we got to 1.7 months’ supply of homes.

What do we see coming? • New Home Construction is out there but not enough to completely solve our shortfall • They are saying Nationwide, that once the Covid-19 Vaccine comes into play, homeowners that have held off selling, may be getting their homes on the market • 2nd homeowners that have not been using their 2nd homes as much for assorted reasons, may see this as an opportune time to sell during this housing shortfall.

What Now?

Buyers
There is still opportunity but will take patience and persistence. Your Real Estate Agent may want to be working full-time, so they can spot and get you out to homes, within reason, at a moment’s notice.

Sellers
What we do know, today is one of the most opportune times to sell. 
Homes are getting numerous showings and multiple offers. Though price is at the top of the list in deciding which offer is best, there are 20+ other points in the Purchase Contract that also help make that final deciding decision. 
Honestly, this is where you need me the most, A Full Time agent that will help you look at all the key points in a purchase contract to come up with the best offer for you and your family.

As with all my Newsletters, they are questions left unanswered, so please, please never hesitate to reach out with those questions.
I look forward visiting with each of you as we moving into a New Year.

Best Wishes and have a Great Holiday Season

Jeff

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