Over the past couple of years there have been reports and rumors of a “shadow inventory” of homes that were being held from the market by banks so the market would not be flooded with homes that would further erode prices.
This has never come to fruition in Arizona and for that matter, the number of foreclosures and short sales has continued to decline. One law office in the Valley that specialized in short sale assistance has removed itself from that market because of the steep decline in business. That spells good news for the future pricing of homes in Arizona.
The new buzzwords are “Shadow Buyers.” Almost certainly there is a pent up demand for housing and the shadow buyers should contribute to the current Arizona housing recovery. We recently sold a home for a client who was relocating to the Valley. They found a home they liked in the Valley, put in an offer, and unfortunately were out bid on the home by a competing offer. In total, there were 29 offers put in on the home with the home being sold for substantially more than asking price. Is this déjà vu of the 2004-2006 home buying days?
Another factor that will be driving the housing market in 2013 is those that short sold their home more than two years ago. They may become eligible for financing to purchase a home again and will be re-entering the housing market.
After years of stagnation there is resurgence in the Valley new home market. Builders are buying land again and preparing for an uptick in business. Buyers who wish to finance a home are being shut out of the housing market by cash buyers. Therefore, they are starting to look at new homes because builders are more than willing to work with buyers who wish to finance a purchase.
The Rim Country housing market normally follows the Phoenix market cycles by 90 to 180 days, however, in the current cycle we appear to be following that market by one year. Based on foot traffic and discussing our current buyer’s motivation for relocation and second homes in our locale, 2013 may be the turning point for our recovery. Time will tell.
Ray Pugel is a designated broker with Coldwell Banker Bishop Realty. Contact him at (928) 474-2216.