If you listen to the media surrounding the Arizona housing market you would believe that it is still falling. You would hear of a double dip recession, that the constant downward pressure of short sales and foreclosures will not allow for the market to turn upwards in for the next 2 to 3 years. If you listened to the media, you would be wrong.

How can the media’s reporting of the Arizona home market be wrong? Truth be told its not wrong it is just out of date. The media makes generalizations, typically based on three month rolling averages in home prices. This is great for giving a big picture overview but its is a terrible way of measuring turns in the market. You would need to wait nearly 3 months to understand that the market has changed, as it has now.

Instead of listening to the negative news coverage for the next three months, here are some alternative ways to measure the Arizona housing market. These ways are more up to date and give you a more in depth understanding of what is going on.

Arizona Home Inventory. Home inventory is the amount of homes that are for sale at any one time in Arizona. To put this in perspective and show the importance of what home inventory levels mean to the pricing, lets give some history. At the height of the housing bubble in 05′ through 07′ there were a mere 7,000 homes available for sale in the valley at any one given time. With millions of residents and very little inventory, supply and demand created the astronomic home prices. When the market crashed and everything fell apart in ’08 there were over 45,000 homes available. These levels held true until just recently. Over the last few months we have seen inventory levels sink by over 50%.

The current home inventory as of July 2011 sits at 21,000 homes for sale. This is a statistic you will not see in the Media, it changes day to day and there is no three month rolling average. However, when inventory falls home prices start turning upward.

Median List Price. Real Estate Agents are in the trenches, they are not looking at facts and figures for the month in review. Agents understand the market much more fundamentally than the people analyzing the figures. Troy Reeves prophesied recently that inventory levels would decline and prices would begin to rise. That’s why when agents start to list homes higher to anticipate rising prices, instead of lower to anticipate dropping prices people should take notice. June was the first month since the housing bubble burst that the median listing price has went up instead of down. This means that the majority of real estate agents believe that the market will go up, so much so that they are willing to bet their paycheck on it.

Shadow Inventory Dropping. Shadow inventory is defined as the homes that are in foreclosure of are in danger of being in foreclosure, yet have not been put on the market for one reason or another.

While there are still foreclosures out there, the numbers are falling. There have also been measures put in place by the government to keep people in their house. The side effect of this is keeping another home off of the market, this in turn lowers the home inventory.

The next time you are watching a major news network or reading a paper/blog and the topic is the sinking housing market in Arizona, allow yourself to check the figures and see where they are collecting there information. If you are thinking of buying a home but keep seeing the negative information in the news, contact us and schedule a time to look at the day to day figures. Now is the time to buy before everyone starts realizing what real estate agents know now.



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