The signs are all around you. The media spouts the phrase “Buyer’s Market.” You know plenty of people whose mortgage balance exceeds today’s market value. And some builders are reporting that their costs to build are greater than the sale price that the homes can bring. PRICES ARE LOW . . . but you already knew that!
Here are a few facts you may not know. May was an excellent month for residential sales in the Phoenix area. Data from the Arizona Regional Multiple Listing Service show there was more than 9,200 residential sales in May of 2009. That volume is similar to our “boom” market of 2005! And supply is shrinking – there is only about a 4 month supply of homes priced under $250,000. This number is down significantly from one year ago. DEMAND IS UP.
What does that mean to you? If you think that you will need a new home within the next two years, you need to consider buying now. Remember our economic basics, when demand is increasing and supply is decreasing there is a strong possibility of prices going up. These are signs of another change in the market. No one can say how quickly the market will change (a crystal ball would come in handy about now!). And there are plenty of negative factors still plaguing our economy, like unemployment and new foreclosures. However, some believe that even the imminent foreclosures may not cause much of a problem considering current absorptions rates.
So, if you are a first time home buyer – there is no reason to wait. If you act now you can take advantage of the low prices, great interest rates and the First Time Home Buyer’s Tax Credit that will expire at the end of this year. This is one of the greatest combinations of buying incentives in recent history. It’s your chance, don’t miss it!
If you currently own a home, your decision is a little more complicated. Can you sell your existing home? Do you have any equity left in your existing home? If purchased your home before 2002 and didn’t refinance – the answer could be yes. If the answer is no, there are still other options available to you. For example, lease out your current home. A time-tested piece of wisdom tells us to “Buy Low, Sell High.” So buy your next home now while prices are low and wait to sell your existing home until the market has turned around. History has shown us real estate is cyclical; the market will shift, again and again.
So what’s your next step? Consider this warning from Mark Twain, “I was seldom able to see an opportunity until it had ceased to be one.” Recognize the opportunities in today’s market! Then, contact a Real Estate Professional who can help you evaluate your current situation and prepare a strategy.
For more information on the First Time Home Buyer’s Tax Credit see the IRS Information Page
Teresa Dempsey (480) 634-7975 DempseyAZ.com
Teresa Dempsey is an Associate Broker with Keller Williams Legacy One Realty. Together with her husband Kevin they formed The Dempsey Group and offer a wide variety of real estate services including professional assistance for buyers, sellers and investors. Teresa spent the majority of her real estate career in the new home business and now uses that experience to help clients find the perfect new home. Visit DempseyAZ.com today or call Teresa at (480) 634-7975 for expert representation in a rough market. The Dempsey Group, Making a difference...One family at a time
I like that Mark Twain quote.
My wife and I currently own our home and are way under, but we’re consistently watching the market to see when we can make a move. Thanks for your thoughts.