“When one door closes, another one opens.”
There seems to be quite a bit of that going on in today’s real estate market.
ShowingTime, the platform REALTORS use to schedule most of the MLS showings, reports that in July, listings in the $200,000-$299,999 range averaged 17.27 showings per listing.
The next closest was 14.10 showings per listing, in the $300,000-$399,999 range. And not every showing is scheduled through ShowingTime, so the actual numbers are higher. That’s a lot of traffic.
You’ve heard the real estate market is hot right now. That it’s a “seller’s market.” But what does that mean? It has to do with the inventory of available homes for sale, most often calculated using the number of active and sold listings in the Multiple Listing Service.
Anything less than four month’s worth of inventory is considered a seller’s market. Anything over seven months is, you guessed it, a buyer’s market. During July, 462 MLS listing sales closed in Glendale alone, and 472 in Peoria.
Based on that number, four months’ inventory—just barely a seller’s market—would be 1,848 active listings in Glendale, and 1,888 in Peoria. As I write this, there are only 198 active and available listings (not counting properties already under contract or pending close of escrow) in MLS in Glendale, and 282 active listings in Peoria.
That’s 42.85% of one month’s inventory in Glendale and 59.75% of one month’s inventory in Peoria. Maricopa County is a little better, with today’s active listings about 75% of July’s closed sales.
Compound that with interest rates of 3% and lower, and you have our local real estate market today.
It’s happening in markets across the Valley and the country. Homebuyers hoping to lock in low interest rates and take advantage of the additional buying power, as a result, face heavy competition, not only from other homebuyers but also from cash-paying investors and flippers. Buyers know they will be up against multiple offers and find themselves having to be creative with their sacrifices and incentives, in the hopes of having their contract accepted by a seller inundated with offers.
Even builders are experiencing high traffic and demand, some resorting to a lottery system for available lots.
And it seems many would-be sellers are instead choosing to take advantage of the low interest rates by refinancing, further contributing to the lack of inventory.
No one has a crystal ball, but we suspect a housing crisis of a different sort could be looming in the distance. Banks do not want another market crash and have already been offering forbearance programs to current homeowners. With forbearance and a renewed eviction moratorium, there is hope that people will be able to remain in their housing until unemployment returns to pre-COVID numbers.
For those needing additional resources, rental assistance is available through the Arizona Department of Housing website at saveourhomeaz.gov. Landlords can apply for aid at arizonatogether.org/grants.
Did you know there’s more to the quote? “When one door closes, another one opens, but we often look so long and so regretfully upon the closed door that we do not see the one which has opened for us.”
It’s a good reminder to keep moving forward, navigate the market we have today and keep opening those doors.