The housing market in Arizona started recovering off its lows in early 2012, as investors took advantage of eroded prices and distressed properties. As the market has recovered, prices have begun to rise off lows and the supply of distressed properties has diminished, resulting in a more normal and balanced market. As investors have retreated in 2014, sales have adjusted to a sustainable pace. In the first half of this year, sales were down 8% in Tucson and down 17% in Phoenix as compared to 2013. We expect these market trends to continue for the balance of 2014. During the market recovery, sales increased and the available inventory of homes dwindled to low levels, resulting in a seller’s market at many price points. As demand increased and supply decreased, prices rebounded off recession lows. Rising prices sparked more homeowners to put their properties on the market.
Coupled with a slowing sales rate this year, the result has been a stabilization of the supply/demand balance. In June 2014, Tucson residential inventory was 34% higher than June 2013, and in Phoenix it was 54% higher than 2013. Wow- that is certainly a large increase! Greater inventory of homes for sale means buyers have more choices, and sellers now face stiffer competition. See the full Long Realty Mid-Year Housing Report here. Advice for sellers? Price well and make sure property is in tip-top showing condition and well marketed. Conditions are dynamic and can vary greatly by area and price point. You can see what is happening in your hyperlocal market here.