The Inventory Problem – Fact or Fiction?
We hear it all the time: “There’s just no inventory out there!” Realtors say it daily. Buyers are frustrated because there aren’t many homes to choose from and new listings often get snatched up within hours. In the Phoenix metro area, the active listing count is down 49.5% from last year. Median days on market is down 24%, from 55 to 42. Median listing price is up 10.2% from last year, at $412,551. Lower numbers of active listings and high buyer demand leads to lower days on market and higher prices. That is the reality in the Phoenix metro market currently.
The Kolb Team specializes in active adult communities. Does this low inventory reality translate into our communities, especially given the added vulnerability in this demographic from the COVID-19 pandemic? Let’s take a closer look at Sun Lakes, the active adult community where we live, which has about 10,000 homes. The average days on market in Sun Lakes in 2020 was 50, down from 58 in 2019. The average list price was up 11.4%, and the average sales price was up 11.7% over 2019, at $345,989. There are currently around 40 active listings in Sun Lakes, so yes, active inventory is low. Let’s dig a little deeper into the inventory picture. The following graphic shows the total number of homes sold in Sun Lakes since 2015.
Remarkably, around 700 homes have sold in Sun Lakes every year for the past 6 years, with the exact average being 693.5 homes. We had 694 home sales in the COVID-19-challenged year of 2020. As a year, sales were unaffected by the pandemic. Demand for homes in active adult communities remains very high. What did change in 2020 was WHEN these homes sold. The following graph tracks quarterly sales in each year from 2015-2020.
The 5 years from 2015-2019 are amazingly similar in pattern. But 2020 saw an uncharacteristic and dramatic slump in sales in the traditionally strong 2nd quarter, and that is right when COVID-19 hit. But then the 3rd quarter was slightly above its previous years’ norm, and the 4th quarter was off the charts higher at 200 homes sold. For obvious reasons related surely to demographics, there is a natural turn of a certain number of homes each year in these active adult communities.
So yes, we do have an active listing inventory problem - but buyers are out there, and homes will continue to come on the market. We are excited and optimistic for 2021, and looking forward to updating this chart a year from now!
An “appraisal” is an estimate of the value of a property, and is done by a qualified professional. The appraisal of your property is as important as your credit history when obtaining a mortgage. After all, the property you are purchasing serves as collateral for the loan.
Although the primary goal of the appraisal is to justify the lender’s investment, it also protects you from overpaying. Your lender will hire the appraiser, and will charge you (as the buyer) a fee for the service.
If the appraisal falls short of the amount you wish to borrow, you may be refused a mortgage or offered a smaller amount on the mortgage. Your offer contract will be contingent upon whether the appraisal comes in at or above the purchase price that you and the seller have agreed upon).
IronOaks Master Planning Committee
This week's Java with John brings in the Board of Directors President, Paula Ferguson, as well as the Chair of the Master Planning Committee, Becky Kolb, to discuss the upcoming Strategic Plan Survey that can shape the future of IronOaks.
Shred-A-Thon 2021 For ALL Sun Lakes Communities
Saturday, February 13th from 8-11AM
We will be near the softball field with two lanes of traffic entering on Price off Riggs going north. Furthermore, once items have been dropped off at the shredder, traffic will exit through the open Mossy Rock gate to Nacoma Drive.
For more information, visit our event page.
- 1 2-lb pkg. frozen hash browns
- 1 can cream of potato soup
- 1 can cream of celery soup
- 1 8-oz carton of sour cream
- ¾ cup of shredded cheddar cheese
- 1 onion, chopped
- salt and pepper to taste
- ¼ cup butter, melted
Put all ingredients except for the butter in a 9x13 pan and mix together gently until combined. Drizzle ¼ cup melted butter over the entire top. Bake at 325 degrees for 1 ½ - 2 hours. Let cool for 10 minutes before cutting (to allow the casserole to firm up).
Highlight on Local Business Owners
Buyers of the Month
We have buyers who are ready, willing, and able to purchase and can’t find homes. If you or someone you know is thinking of selling and can accommodate, get in touch with us. We have your buyer.
- Illinois buyers looking for a 3-bedroom home with a casita, pool, and 3-car garage.
- Buyers from the Midwest seeking golf course home with 2.5-car garage. Would prefer it with updates already completed.
- Buyers from the Pacific Northwest seeking a home with a full 3-car garage. Large, covered patio with a pool or yard large enough to install a pool. Preference is to have the backyard facing North or East. Would like open concept living.
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Real Estate Update
Wondering about your Neighbor’s Home Sales Price? Find out here to see what sold last month. The report is broken down by HOA, address, and floor plan (if the agent listed the model in MLS).