Phoenix Market Shifted, but Sitting Still Is Risky Too

I recapped the last 30 days of the Valley housing market against this time last year, and the shift is hard to miss. More homes are sitting on the market, and fewer of them are moving.

Inventory is up, and sales are down. Available inventory has risen 4.99%, with 30,213 active listings compared with 28,777 a year ago. Homes pending dropped 17.73%, from 7,683 last year to 6,321 now, while homes sold slipped 14.36% to 5,073, down from 5,924 a year ago.

Months of supply now sits at 5.5 months, up 27.91% from 4.3 months this time last year. Numbers like these send a lot of people into a panic, convinced that now is a bad time to buy or sell and that they should sit tight and do nothing.

Your home isn’t a day trade. I’d ask anyone thinking that way whether they plan to day trade their home. I say that half-jokingly. Most people stay in a home for at least five to seven years, so the real question is whether you’re better off on the sidelines or making a move.

I tell my clients the same thing every time. Pick the place you want to be in for the next 7 to 10 years. If that’s the home you’re in now, it hardly matters what the market does.

Move before you have to. If you only want to stay in your current home a year or two longer, now is a good time to start thinking about your next step. Waiting a couple of years could bring a better market, or it could bring a worse one.

The better approach is to choose a time when moving benefits you, but you aren’t desperate to do it. People who wait until they absolutely have to move, sometimes under the gun, don’t always get the best outcome. Move when it’s convenient and when it feels right, even if that means moving a little prematurely rather than at the last possible moment.

Lower rates come with trade-offs. Some buyers are sitting on the sidelines waiting for rates to come down before they make a move, but that strategy has downsides. Rates dropped a lot in 2008 and 2009, yet that was during the Great Recession, and property values were dropping too. Lower rates don’t necessarily mean a stronger economy.

In the other scenario, rates drop while the economy stays strong, and a wave of buyers comes back into the market. Sellers would welcome that shift. Buyers would face far more competition, sometimes against five to eight other offers. Many would end up paying more than appraised value just to get a deal.

Buyers have room to negotiate now. I find it interesting how buyer behavior flips with the market. In a hot seller’s market, buyers jump into bidding wars and pay more than appraised value. When prices start to soften and sellers are willing to negotiate, many of those same buyers sit on the sidelines. It’s kind of crazy when you think about it.

If you’re thinking about buying or selling a home in the Valley and aren’t sure what makes sense for your situation, I’m happy to talk it through. I’ve been doing this for over 25 years and have sold over 200 homes in the Valley. Call or text me at (602) 738-9943, email me at jason@thepenroseteam.com, or visit buyaztoday.com. I’d love to help you with your move.