Balanced market an exciting time for buyers

Many people are having bad memories from the 2008-09 market crash we experienced here in Queen Creek. Many people ultimately lost their homes mostly due to bad mortgages.

Back then, a bank owned home sold between $70,000 to over $100,000, obviously depending on the home. Driving through certain neighborhoods, weeds from abandoned homes were so tall they peeked over the fences from the backyards.

HOA’s were not maintaining the aesthetics of their communities due to their lack of income as a result of homeowners not paying their dues. No wonder we all have bad memories from the crash!

This is not that market.

What we are experiencing is a change in our local real estate market with a velocity no one anticipated. Last month, I shared that by August we would likely be in a balanced market. It’s still July and we have already been in a balanced market for a few weeks.

What is a balanced market and what does that mean to home sellers and buyers? A balanced market is a market with a healthy inventory level that provides plenty of options for the buyers to choose from while the seller is still able to sell their home.

The average days on market for a home is longer and could be in the range of 30 days. While this is a sharp contrast to the market we just came out of, it’s important to note that this is considered normal for a balanced market.

A balanced market for buyers is exciting! It means they have time to consider which home they actually want to purchase. It also provides far more options for the buyer than a seller’s market.

It is also a time where buyers, who can afford the monthly mortgage on a home but may be struggling with closing costs can actually re-enter the market.

A balanced market for a seller means that while it may take longer to sell their home, they can expect healthy negotiations with the buyer.

The added time on market actually provides the seller the opportunity to figure out where they are moving to and when and how to coordinate that with their move.

Our topic of the market change would not be complete without addressing the interest rates. Yes, they have gone up. They are still 2% lower than the rate I secured on my first home in the late 90’s, when we celebrated locking in under 8%.

Have you heard the phrase “Marry the house, date the rate”? Just as it sounds, a buyer should place more emphasis on the place they want to call home than the rate itself.

A home has deep and lasting meaning. Rates have a history of going up and going down. When the rates drop, a homeowner could refinance. Not the most ideal scenario but one many are focusing on right now.

Another main focus right now is a rate buy down. The buyer could pay for this themselves. This would also be an option for the seller to pay on behalf of the buyer in lieu of lowering the price as it saves the buyer far more money in the long run.

Since April, each week has brought a new set of changes to our real estate market. Last month I reported there were 13,500 homes active on the market. That number moved to almost 18,000 in one short month.

I look forward to sharing the changes in our market again next month. For now, if you plan to sell your home any time in the near future, now would be the time.

Melanie Nemetz, the owner and founder of The Melanie Nemetz Team with Keller Williams Integrity First can be reached at 480- 221-3034, melanie@fosteringre.com or www.fosteringre.com