The pandemic has affected numerous industries across the world and for many, the dent is just too big to be fixed. The real estate market too has faced the wrath of the economic crises however the story is quite different here. In Arizona, research conducted by housing authorities was based on the trends from 2019 and the effects of the pandemic this year, and it reflected many discrepancies among the experts.
Although not conclusive, these reports can give a pretty clear idea as to how the real estate market is responding in 2020. However, it is also to be kept in mind that these are mere predictions which are bound to change over time. Now that we have kept it aside, let’s take a closer look at these observations.
Real Estate Market Trends in Arizona
The first trend is a treat to those seeking a new property on Arizona soil as the mortgage rates have dipped almost 12 times this year, making it extremely suitable for the new buyers. People who have just entered the Arizona real estate market should leverage this opportunity and lock their deal before the mortgage rates shoot up again. This was evident from the fact that due to potential CoVID vaccine news, the mortgage rates enjoyed a little jump. The spike was although not much, but it is still ideal to buy before it’s too late.
Many buyers tend to wait for the correct time before they could make a final call. However, the problem with waiting is that you could potentially miss an amazing deal and end up paying way more than now. Many top institutions have collected several data points and have come to a prediction that the interest rates are expected to increase as the pandemic resolves and the economy hits the track again in the next four quarters.
Market Trends For The Sellers
Now here comes the trickiest part. Buyers can utilize the low-interest rates to get the best deal they are looking for. But as a homeowner, you may ask yourself, what’s my home worth? However, while the lower than ever mortgage rates have made it easier for the buyers to strike a fruitful deal, homeowners too are getting their share of the pie. How so? Think about it. Buyers would want to buy homes and undoubtedly, there is neck-deep competition in the real estate market to lay hands on the best property. What does the seller get? Options.
If you have a home that’s built nicely, have a good neighborhood, and is well-maintained, buyers would line up for your house to purchase it. That’s what the current real estate market has given to the sellers. Based on a recent NAR’s report, homes in Arizona are receiving 3.4 offers on an average before being sold. Homes that are under $350k are getting even more offers. Due to this, many buyers are not able to get their dream property and have to start looking out for more. This discourages the buyers from buying a property in Arizona and many are even fleeting elsewhere for house hunting.
So does that mean Arizona is not fit for investment?
No, it is. In fact, Arizona is one of the best places in the United States in terms of real estate dealings. However, things have been a little slower than usual, and the market is flat considering the higher demands and very less, or inadequate supply of homes.
Those that are up for selling, have a price tag so huge, that it nearly makes it impossible for a normal buyer to even think about buying it. And due to this huge difference between the demand and the supply, experts predict that the sales of the existing homes will decline.
Challenges
For home buyers, this year can be a little tougher and full of competition as compared to the previous one. However, as already mentioned, this year also offers buyers a chance to buy their dream property at reasonably low prices. Just a little competition is what you would have to face to win this. And if you think you are alone, you are actually not. A report by NAHB said that difficulties in finding a new home are likely to draw 20% of buyers away from the property market.
Now although that figure is 15% up from the previous year, it shouldn’t let you stop your home hunt. This is because the incredibly low mortgage rates that we have seen recently are likely to rise steadily as the economy strengthens and grows to become better. Waiting for the competition to settle, and people to back off of their property search might take you straight to a future market that has high-interest rates.
Result? You’ll pay a lot more than now. The current real estate market is offering you a chance to leverage the affordability it’s providing to the fullest. And if you haven’t yet, you still have this winter to make an affordable home yours.
The Takeaway
Times have been hard and every industry has faced the consequences that came with this pandemic. However, the real estate market is one such industry that, although affected, was quick to recover from this crisis.
Mortgage rates have slashed down more than 12 times this year, with it also touching the less than 3% mark for the first time. All this makes buying a home cheaper than ever so there’s absolutely no point in you missing this amazing deal just because of stiff competition.
Bidding wars, neck to neck competition, and uncertainty whether or not you’ll get a house of your choice may make you as a buyer feel a little lost. However, it is genuinely advised to not let all this deviate from your hunt to get your dream home.
Because the market is being nice these days, nobody knows for how long it will last. And for all the homeowners out there, the current real estate trends are in your favor. You have the choices, you have the options. Choosing wisely between those is the only thing that’s needed now.
