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2019 Arizona Real Estate Market Update With 2020 Predictions The Market Is On
2019 arizona real estate housing real estate market update with 2020 predictions
Jay Bru 480-466-4917 (January 2020)
I recently attended an Arizona Real estate market update with Fletcher Wilcox and Tina Tamboer. They are two of the smartest and most knowledgable individuals with regard to real estate in the valley.
They are in agreement on Arizona and its stats. I have read many blogs and I also use the data from ARMLS. The MLS covers the Metro Phoenix area which is 4,857,962 people and the central part of Arizona. Different stats contain different areas of the cities, so many market updates will vary slightly.
I’m going to show where we’re at, where we’re going, and why.
Prices will continue to go higher in 2020! It mainly comes down to Population growth, supply and demand.
AZ has the 3rd highest state population increase.
330 people moving to AZ every single day
Monthly Supply of homes is 2.05 months, healthy is 5-6 months. (time it would take to sell all existing homes without new listing)
AZ had 4 cities in the top 20 for 'Best cities for jobs' from Wallet hub, (1- Scottsdale, 6-Chandler, 8-Tempe, 20th place is Gilbert)
Predictions for 2020 are Prices ⬆︎, Inventory - tight, New homes sales ⬆︎, Interest Rates ⬇︎.
Supply of homes is low due to a lack of building.
Sales: The year-over-year comparison is up +18.5% from 2019-2020
A 4% price appreciation is expected for 2020.
Interest Rates to remain low.
The USA and Arizona are doing a tremendous job creating jobs, click here to read more about that.
Rent rates remain high and increasing, click here https://jaybrugroup.com/apartment-rents-climb-faster-metro-phoenix-anywhere-u-s/
Click here to download the stats I will be talking about here:
I've chosen the top charts to show you what's going on in the Arizona Housing market in 2019..
Monthly Sales are up 8.8% month-over-month. The year-over-year comparison is up +18.5%.[/caption][caption id="attachment_921" align="alignright" width="329"]Months supply of inventory is 2.05 months, meaning that if sales continued as normal, and no new listings hit the market, it would take only 2.05 months to sell through currnnt inventory. A normal balance some say is 5-6 months of inventory. This puts upwards pressure on prices.[/caption]
The average sales price is up +10.3% year-over year while the year-over year median sales price is also up +10.6%. This is a woulda, coulda, shoulda. If you owned a $300,000 house, you just made $30k on your money. But what if you only put 5% down, what about the fee's, fixing up, and new roof. So a lot goes into this number, but nonetheless, this is extraordinary.This is the most amazing stat of 2019. The total inventory is down 25% from a year ago, I believe its 30% on all of Arizona. This is due from Demand, population growth and not enough building taking place.[/caption]
Your house will sell in 61 days if you put on the market now. This is not accurate for a $300k to a $1 mill home. I can give you your zip code and house price averages, just let me know. December 2019 is basically breaking records from the highs in 2005. Just look at 2005-2009. I don't personally believe this will happen ever again. Not this dramatic, anyway. If you look we have a steady climb but still too aggressive in my mind. [/caption]
As we move into 2020, there is no more important metric than supply and how supply relates to demand. Looking ahead, we’re coming out the box hot, characterized by above normal demand and extremely low supply.
STAT reported 18,049 active listing (excluding UCB & CCBS) at the beginning of 2019, and we begin this year with only 12,425, a decline of 31%. This here says it all. The time it takes these builders to build these homes, people stop moving here, and for a balanced market to take place, could take over 2 years. Predicting home prices past 2 years is irresponsible in my mind. Zillow for instance has a 20 year glance, how do you know that what will happen in 5 yet 20? So many things can happen.
In conclusion, just do the eyeball test. Look for cranes in Tempe AZ, try and rent a house off the mls or zillow (they go quickly), try purchasing a decent house for under $250k, and read this blog. This isn't my imagination, this is real life stats from the MLS, The Cromford Report, and Wilcox report. So I don't care if you have a conspiracy theory that your drunk uncle told you that house prices were crashing in 2020, this is real data from very smart people.
Events that could possibly bring down home prices are war, change in presidency, natural disaster, or some black swan that i'm not thinking about like student debt or something like that. What do you think? I'd love to hear your thoughts!
But Demand is up, Supply is down 31% from last year, Maricopa county is number 1 in population growth, and there is not enough building happening. I predict a 4% appreciation rate and I expect Arizona to become a larger destination then it is today.
Hope this helps, call me if you have any questions.
Jay grew up on a grain and cattle farm in Saskatchewan and started working at a very young age. He got into real estate at a young age buying his first property at 23. He's owned several businesses in....
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