Before Buying In An HOA Community Ask These QuestionsSo you’ve bought a home in an HOA community. Be prepared for LOTS to read and know what to look for to avoid future problems. The most

Dated: December 2 2020
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Phoenix Homes More Affordable Today Than in 2018? YES!!
25,000. Keep that number in your head. 25,000 is a nice round number that reflects an estimate of the typical amount of homes for sale in the Phoenix metropolitan area during a "normal" real estate market.
10,000. The Phoenix metropolitan area has less than 10,000 properties for sale at the moment. Many of you have heard me talk over the last few years about a strong sustained sellers market and predict that eventually, as in most things, the pendulum would swing back in favor of buyers. Not today my friends. Not today!
Buyers are frustrated by competing with high demand and low supply. One would draw the logical conclusion that while it's a phenomenal time to be a seller in this market, it's a nightmare for buyers. However, the very reason that demand is so high, makes it a great time to be a buyer. And I can summarize that reason in one word: Affordability!
The graph above illustrates this affordability well. A home that sold in the final quarter of 2018 for $300,000 now shows a value of $333,000. That's an 11% appreciation rate. Common sense would tell us that the monthly payment on that home will have risen corresponding to the appreciation rate. However, the payment on that home today is actually LOWER than it was in 2018, making it MORE affordable. And that's due to interest rates.
In Q4 2018 the typical interest rate on a mortgage loan was 4.75% resulting in a principle and interest payment of $1565 per month on a $300,000 loan. Today, with an interest rate of 2.875% on a $333,000 mortgage the monthly principle and interest payment is $1382. Despite an 11% appreciation in value, the payment today is $183 lower!
I am still hearing some buyers hanging out on the sidelines to buy, waiting for home prices to go down so a home is more affordable. We don't see that happening in the near term. Phoenix homes are generally high on the affordability index. Any decrease in values, should that happen, will likely be minimally significant. If that decrease occurs and interest rates increase, which they are bound to, that reduction in monthly payment will be wiped out (and then some!), likely increasing the monthly payment.
The biggest challenge for buyers right now, is getting an offer accepted as sellers wade though multiple offers. That's why a good real estate team is essential in crafting strong, creative offers and giving sellers reasons for accepting those offers. If you're a buyer hoping to be in a new home before the end of the year, make sure you're working with an agent that understands what is required in varying markets, and can easily adapt to what is happening in the moment. And if you are considering selling your home, I cannot imagine a better time to list than right NOW!
Family, Community, Home, Helping. These are the things at the core of who we are. As a home buyer or seller, that means YOU are among our highest priorities - whether you're a first time home buyer, i....
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