“You would expect the number of house sales to be down. And, in fact, single-family house sales were down 30% last week from a year ago. But at the same time, the number of houses hitting the market last week was down almost as much, down 27%. The market, therefore, is about a tight as it was last year at this time. That is, very tight.”
Conclusion
The rebound continues. And the market got even tighter last week. We now have fewer single-family houses for sale than houses under contract to buyers. That’s weird. If the trends of the last 6 weeks continue, the market will get even tighter. And right now, we only have 1.4 months supply which is insanely out of balance!
Advice to Sellers who are also Buyers
It doesn’t matter much when you buy and sell, if you’re selling and buying at the same time and staying in Arizona.
If prices are up, what you gain on the sale, you lose on the buy. If prices are down, what you lose on the sale, you gain on the buy.
If, however, you were planning to move to a part of the country that has been particularly hard hit by Covid-19 (e.g. Las Vegas & Orlando), then I’d consider, maybe, waiting a while and seeing if prices start to fall there.
Advice to Sellers
If you were considering selling an investment property within the next couple of years, I’d suggest sooner rather than later.
I keep worrying that a lot of the homeowners who put off selling their homes because of Covid-19, will eventually put their houses up for sale.
And what happens when all those mortgage forbearance programs eventually end? How many will decide to sell when they have to start making mortgage payments again? Will the number be large or small?
Of course, if your investment property is cashflowing nicely, it might be smart to hang onto it unless you can find an alternative investment that earns as much with less hassle.
Anyway, it seems like a good time to sell any investment properties you don’t love.
Advice to Buyers
I’m less certain about what first-time homebuyers should do. There are a lot of moving parts. I’ll write about it in the future. (What do you think? Leave a comment.)
New Listings
The number of single-family houses hitting the market has been more or less flat for a few weeks now. (I’m not considering last week’s number because it’s always revised up.)
For Sale
I did NOT expect this! The number of houses for sale is has been trending DOWN for 5 weeks. We have 33% fewer houses for sale than a year ago at this time.
Under Contract
The total number of single-family houses under contract to buyers is up 27% from 4 weeks ago and it’s almost the same as a year ago!
Solds
The number of single-family houses sold continues to increase after bottoming out 3 weeks ago. Given the increase in the number of houses under contract, I expect sales to continue to increase for several weeks, at least.
Takeaway
You would expect the number of house sales to be down. And, in fact, single-family house sales were down 30% last week from a year ago. But at the same time, the number of houses hitting the market last week was down almost as much, down 27%. The market, therefore, is about a tight as it was last year at this time. That is, very tight.
This information can vary a lot in different parts of metro Phoenix. Your real estate agent can find the data for your specific city or zip code at The Cromford Report.
To see what’s happening beyond Phoenix, be sure and also subscribe to my other website, RealEstateDecoded.com.
Note. This post was written on June 1, 2020 but the graph will be continually updated.
# # #