It has been about a year since my last Blog post due to factors out of my control. However, I’m back and will be posting to my Blog monthly hereafter. I will cover the same topics as before and focus on listings and closings in Corte Bella and the 55+ market in the Phoenix metro area.
Housekeeping Matters
Because I focus 100% of my efforts on Corte Bella properties, I have added a new name to my business. I now market under the name CorteBellaHomes.net. My email address has changed to jkladd@cortebellahomes.net and my telephone number has changed to 602.486.0442. I am now brokered by HomeSmart Realty.
The Phoenix 55+ Housing Market
So, you ask, what's up with the Phoenix and Corte Bella housing market? Funny you should ask. They say a picture is worth a thousand words and the chart below proves the statement to be true. The chart shows the Median Sales Price (MSP) of 55+ homes sales in the 85375 Zip Code for 2021-2023. The top of the market was May of 2022, when the MSP hit $460,000. As of July 7, 2023, the MSP is $397,500, which is decline of $62,500, or a 14%. Now for some good news. The MSP on January 1, 2021, was $305,000 meaning the current MSP of $397,500 is up $92,500 or 30% in two and a half years! Your home is your shelter more than it is an investment. However, a nice return on your shelter doesn’t hurt!
Although we had a decent spring, we are in the dog days of summer in Phoenix and seeing low demand and even lower supply. With the 30-year fixed interest rate stuck around 7%, most homeowners do not want to sell and give up their sub-4% loans, and buyers are struggling to qualify and afford a home with 7%+ mortgage rates. Buyers who can afford a 7% mortgage are unimpressed with the low inventory of re-sale homes and are increasingly turning to new built homes. Developers are enjoying strong orders, firmer prices and healthy margins, but have relatively low inventory of homes for sale and a weak pipeline of new permits to build. The strongest sector in the housing market is single-family new construction. Not something a real estate sales professional wants to hear.
It is easy to overstate the importance of interest rates in determining home prices. Interest rates are important, but it is the balance between supply and demand that determines how prices move. At the moment supply is much weaker than demand so prices are increasing. As the chart below shows, on July 30, we had 50 days of inventory versus 120 days in January of this year. A balanced market here in our market is generally thought to be a 60 days supply of inventory. Inventory should climb as our high-season approaches and sellers list their properties to take advantage of our snow-bird market.
While interest rates remain in the 7% range, it appears unlikely there will be much improvement in the overall Phoenix housing market until rates decline to 5-6%. However, higher mortgage rates have less of an effect on Corte Bella buyers since roughly 25% of Corte Bella buyers are cash buyers who are not concerned with mortgage rates. Rising prices will make it even harder for buyers in the overall Phoenix market to close on a home. This could also be the case for Corte Bella buyers as more expensive homes require more cash or a loan to close. However, if interest rates fall to 6% or below, all bets are off and we could see a sharp increase in demand and prices.
Corte Bella Stats for July 2023
We are well into our seasonal swoon, which typically lasts until October. As of July 31, we have 11 listings in Corte Bella and we had seven closings in July, 13 in June, and nine in May. The seven closings are the last of the escrows to close from the mini rally we saw in April and May of this year. I expect fewer closings through the end of the year. Activity will probably increase beginning in January 2024, with about average closings. See below for more thoughts for the rest of 2023 and 2024.
Looking Ahead
Based on current fundamentals for Maricopa County one would think this will be a slow high-season in Corte Bella. However, 55+ communities such as Corte Bella are odd ducks. They operate on a different set of fundamentals than the broader market. This is why I cringe when I see a sign go up for 72Sold sign or another agent who rarely works Corte Bella. Agents who don’t work Corte Bella everyday like I do, do not fully appreciate the market dynamics here in Corte Bella. I have seen instances where an outside agent will fail to price a listing properly, typically resulting in an unusually long listing period due to the property being over-priced or, worse yet, an immediate offer from a buyer who better understands the Corte Bella market and who recognizes the list price is too low. We have several fine agents who work Corte Bella every day in addition to myself so, if you are or thinking of selling in the near future, make sure to speak with a professional. I would love to have tho opportunity to meet with you and discuss your options.
Next month, the 72 Sold myth.
Have a great month and call or email me anytime with questions!
New Listings, Pending, Closed Transactions for July 2023.
The information contained herein is believed to be accurate however you are encouraged to confirm this information before relying upon it.
ACTIVE LISTINGS
12824 W Junipero Dr.; Arcada Model; 1,684/sf.; 2br/2ba. $454,900
12812 W Junipero Dr.; Arcada Model; 1,884/sf; 2br/2ba $455,000
13813 W Junipero Dr; Arcada Model; 1,660/sf; 2br/2ba $461,000
12948 W Micheltorena Dr.; San Ysidro Model; 1,812/sf.; 2br/2ba $459,900
12722 W Figueroa Ct.; Encanto Model; 2,095/sf.; 2br/2ba $559,000
12950 W Quinto Dr.; Mirada Model; 2,559/sf.; 2br/2.5ba $677,000
12832 W La Vina Dr.; Cambria Model +Casita; 2,582/sf.; 3br/3ba $679,000
13233 W Los Bancos Dr.; Figueroa Model; 2,784/sf.; 2br/2.5ba $738,000
21912 N Valerio Ct.; Granada Model; 3,027/sf.; 3br/2.5ba; GC Lot $850,000
22422 N Del Monte Ct.; Granada Model; 3,027/sf.; 3br/2.5ba; GC Lot $949,000
UNDER CONTACT ACCEPTING BACKUPS
23215 N Cardenas Dr.; Mirada Model +Casita; 2,806/sf.; 3/2.5 $725,000
UNDER CONTRACT CONTINGENT ON BUYER SALE
22322 N Arrellaga Dr.; Montecito Model; 1,315/sf., 2br/2ba $449,000
PENDING LISTINGS
12848 W Junipero Dr.; Montecito Model; 1,315/sf., 2br/2ba $395,000
12731 W Junipero Dr.; San Ysidro Model; 1,837/sf; 2br/2ba $489,000
23236 N Caleta Ct.; San Marco Model; 1,904/sf; 2br/2ba $529,000
13555 W Nogales Dr.; San Marco Model; 1,904/sf; 2br/2ba; Pool $675,000
CLOSED LISTINGS
22426 N San Ramon Ct.; Belita Model; 1,154/sf.; 2br/2ba; GC lot $420,000
13811 W Figueroa Dr.; Encanto Model; 2,095/sf.; 2br/2ba $490,000
13440 W El Sueno Ct; San Ysidro Model; 1,812/sf; 2br/2ba $510,000
23122 N Loreto Dr.; San Marco Model; 1,904/sf; 2br/2ba $530,000
13420 W San Pablo Dr.; San Ysidro Model; 1,837/sf; 2br/2ba $539,000
12959 W Rincon Dr.; San Marco Model; 1,904/sf; 2br/2ba GC Lot $585,000
13123 W Micheltorena Dr.; Figueroa Model; 2,784/sf.; 2br/2.5ba GC Lot $850,000
22409 N Del Monte Ct.; Granada Model; 3,027/sf.; 3br/2.5ba; GC Lot $912,500
If you are interested in seeing any of the above "Active" properties, I would be happy to arrange a showing.
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