Lack of Inventory may be affecting the Real Estate Market in the City of Phoenix, Arizona. For a market that was hard hit during the real estate meltdown, it needs a strong real estate market activity to rise out of the ashes.
This City of Phoenix is doing well in terms of real estate activity, home prices are increasing and for a few months now we have been seeing more buyers out there looking to buy a home in Phoenix and having problems because of the lack of inventory.
Phoenix Real Estate appreciated by 25.6% this month compared to last year
The city of Phoenix is seeing a 25.6% appreciation in home prices this month compared to the same time last year. This month’s average price per square foot is at $118.73 compared to $94.54 same time last year.
Phoenix Real Estate appreciated by 25.6 percent this month compared to last year copy
Number of Homes Sold in Phoenix reduced in last 2 years.
After an increase in real estate sales in 2011 with investors and cash buyers all over the place, the City of Phoenix is beginning to see the transactions, taper off to the pre-housing boom era of 2003.
The chart below shows the number of home sales by type of during the month of August going as far back as 2001. August 2012 saw a reduction to less than 1400 homes being sold compared to the previous year with over 1600 homes sold in August and this month Phoenix seems to be on the same tract.
Phoenix Real estate Sales Month to Date by Transaction Type
Number of homes coming up for sale in Phoenix Decreasing
The reduction in number of homes sold is not because they are no buyers but because of the lack of inventory.
Last Year, the City of Phoenix saw a little less than 27,000 homes come up on the market for sale and so far only about 17924 homes have have been listed for sale with about 4 months left in the year.
New homes listed for sale in Phoenix AZ
Inventory has not been stable, reliable nor predictable in the past months and for a market that is emerging from the ruins of the recession, Phoenix needs some stability and sustainability to maintain the gradual growth it is seeing in real estate.
The lack of inventory could be attributed to home owners not having enough equity to sell and holding on to their properties till they feel they are comfortable to sell and also cash flow investors having their investments occupied by tenants while holding on for a much better price to sell.
As a home owner thinking about selling, this will be the best time to sell if you have enough equity because there is not a lot of competition and buyers will be asking for more concessions when the market is flooded with lots of homes to sell.