Good news for home buyer’s in Arizona, the hot housing market is cooling down quickly. After 2 years of rapid growth, record sales, and prices rising to record levels, we are finally starting to see a leveling off. In the past 30 days, over 12,000 new residential listings were added in the Greater Phoenix area. It’s a record 34% jump in new listings.
Mortgage interest rates have risen significantly in the US with the current average 30-year fixed-rate mortgage around 6% versus just a year ago it was hovering close to 3%. This has dropped demand across the US in every market.
“As the spring market ended and interest rates rose, the market shifted very quickly,” said Miles Zimbaluk, CEO at Canada to USA and lead agent for the Canada to Arizona real estate team. “We are seeing a rapid increase in the number of listings finally giving buyer’s some choice. We haven’t seen prices decrease yet, and we are not sure if that will happen or not. It really depends on if interest rates get pushed higher.”
Despite the cooling conditions, the Phoenix area remains a sellers’ market, but it will be more balanced very soon. Prices are still rising, but very slowly and at a more nominal rate. Buyers have more inventory to choose from, and sellers likely won’t be selling their homes within hours of going on the market. We should see a near balanced market by August or September.
It is safe to say the market has peaked, so any property owners who are looking to sell and cash in on their Arizona real estate investment, there couldn’t be a better time than now. It’s still a strong seller’s market today, but that will change over the next few months. Prices are expected to level off as the market shifts to a balanced market.
Sellers can no longer expect multiple offers within hours of listing their property. Just a couple months ago sellers were receiving 5 to 20 offers within the first couple days on market. Today you can expect to wait for the right buyer and the bidding wars are nearly over.