The “traditional” media should soon be reporting that Arizona is showing a positive increase in the inventory of homes for sale. In June of this year, we saw our lowest number of “Active” homes for sale at just over 12,500 following 8 months of continual decrease. Currently, with just under 15,000 “Active” homes for sale, we are seeing over 3 months of continual INCREASE in “Active” homes. That is great news! But, don’t get too excited yet, we still have a long ways to go! If you’re wondering if we are in a “Buyer’s Market” or a “Seller’s Market”, there is no question – the Sellers are still in the driver’s seat!
Just ask anyone currently looking to purchase a home. A home comes on the market and you’re notified by your Realtor that this is a home that meets all your criteria. You preview the home with your Realtor that very day and immediately draw up a full price offer. You patiently wait to hear if your offer was accepted and are soon notified that you are in competition with several offers and the Seller is now asking for your “Highest and Best”. There’s only one “Winner” in this contest and all the others, well, they’re the “Losers”! If this happens more than a couple of times, the whole process becomes discouraging and frustrating. So, is there any hope? Of course there is!
The fact that inventory is increasing is a very positive change! In order for us to have a “healthy” market however, we need to see our inventory of Active homes somewhere around 30-35,000, and that will take some time! Meanwhile, the median price for homes continues to gradually increase as Sellers push the envelope in attempts to get as much as possible for their homes. Your Realtor should be your best asset! “Someone” is always the “Winner” in a “Highest and Best” situation and your Realtor should be giving you the guidance you need to make a well informed decision that can make your offer shine brighter than the rest! There are huge differences in the way we approach an offer depending on the type of property we’re looking at. Is it a Short Sale, is it an REO/Bank Owned property, is it a “Normal” sale or is it a “Flip”? This information alone tells us a TON about the property and what the Seller may or may not do. As an example, by looking at REO/Bank Owned properties, we are able to anticipate what banks may be doing with regards to pricing based on the number of “Days on Market” and are able to position ourselves appropriately. Banks, typically do not entertain offers below 10% of appraised value. So, a bank owned home listed at 200,000 probably will not consider an offer below 180,000. If no offers are accepted in the first few weeks however, the bank will probably be looking at a price adjustment around day 30. They may drop the list price 5-10,000 and, knowing this in advance, may give us the opportunity to enter in to negotiations that could allow us to acquire the property between 170-180,000. Each property is different and there are certain “indicators” that give a Realtor insight that should be communicated with the Buyer to ensure they make the best decision possible to acquire the property under the best possible terms and conditions. Your Realtor wants you to be a “Winner” in negotiations and is your advocate! When you win, they win, too! Be sure your Realtor is advising you of the best ways to position yourself in EVERY offer, listen to their advice and strategies and make decisions you feel comfortable with. Put your best foot forward, especially in this market, and you’ll see success, even in this “Sellers’ Market”.
