I read a lot of “stuff” about the real estate industry. Listen to a variety of radio broadcasts and podcasts as well. You might say it is a hobby of mine. Lately, there has been a kaleidoscope of opinions, an explosion of attitudes, about which way this market is heading… There are blogs that seem giddy with anticipation that the real estate market is about to fall off a cliff like Wily Coyote, destined to be a 5 year blot at the bottom of the new millennium. These folks would be the permanent-renters. Then, on some local radio shows, the paid programming type, I hear Realtors & lenders twist the statistics into their own version of “this is a great market!!” These would be the PT Barnum cheerleaders…

 

Which is it? Market in the tank? Market doing okay? Well, as is often the case when money is involved, the truth is somewhere in the middle… Nationally & locally, there are changes going on that are unique, and some that are entirely predictable. Enough that both ends of the spectrum have a nugget of truth to show you with one hand, while their other hand is holding the latest copy of “How to Sell Ice to Eskimos”. Should I mention that the newspapers are part of the problem? No secret that bad news sells better than good… So the question remains, what is the market like right now, and how about the next year or two? This is what really matters.

 

PHX area homes were selling for ABOVE list price, in hours, from mid 2004 until mid 2005. Then, a peak was reached in the 3^rd quarter of 2005. Since then, the pendulum has swung the other direction. Smart observers feel that this trend has another couple of quarters to go. Mid 2007 is when we expect the signs of improvement to be universally acknowledged. (The Luddites will never accept a good market, however.) If you have a home that went up at 3% per month for 15 months, and now it appears to be sliding back at 1% per month, is the world really crashing in on you? Well, if you have zero equity, perhaps. But then, this is only a problem if you are also selling.

 

Buyers are now feasting on more choices than ever. Over 45000 homes available in the PHX area. Loans are still being made, although the hybrid loans are harder to get. Of those 45000+ homes, many are vacant, and many are over-priced. Some of these sellers refuse to believe that it is no longer 2005. Best advice for these folks is to “get real”…

 

For buyers, know that there are some good months ahead – until mid ’07. The usual Realtor mantra of “good time to buy” is very true right now. I have often differed with this cliché, but it holds up well today. Sellers will roll out a red carpet for a true buyer…

 

So, is the market Good? or Bad? It all depends on the hat you wear… Without a doubt, this market is interesting! Just don’t believe everything you read or hear!! Someone may be selling you a block of ice.