Phoenix Area Market Update – Fact and Opinion

By Buying, Mike's Articles, Phoenix Metro Real Estate News, Renting, Selling December 2, 2019

As Realtor professionals, we view the current Phoenix Metro residential real estate market landscape with a mix of excitement, and wonder. Excitement because we’re seeing the initial stages of a potential and dramatic market shift. I mean, this is happening now, in real-time.

The wonder part has to do with the question, “We wonder what’s next?” I think the best way to demonstrate the current market is by providing various market facts (or professional opinions) that we’re observing, such as:

Fact: The latest (11-26) S&P Case-Shiller report:  Phoenix is leading the nation in appreciation year over year at 6%, which is close to twice the national average of 3.2% and almost 25% higher than the next leading city. The index rose .46% since last month! Benefit: Homeowners. Detriment: Renters.

Fact: Mortgage Loan Limits: Recent news last week reported by the FHFA that Conforming real estate Loan limits in Maricopa County will increase 5.4% from $484,350 to $510,400. This move enables borrowers to obtain higher mortgage amounts without the higher costs associated with a “jumbo” mortgage. Benefit: Moderate to Higher Priced Buyers.

Opinion: Low Mortgage Rates: Mortgage rates for the next year are expected to remain at current historically low levels, according to the Mortgage Bankers Association. They predict mortgage rates will remain low in 2020, rising to an average of about 4% by the end of next year, with the impact confined mainly to boosting home purchases rather than spurring refinancing. Benefit: Buyers.

Fact: 12,611 active listings compared to 17,081 last December 2nd 2018. Benefit: Homeowners/Sellers. Detriment: Buyers. Renters.

Fact: New Home Construction Strengthens: At the end of October there were 20,791 single-family permits issued across Maricopa and Pinal counties, up 6% from 19,600 in October 2018. Benefit: Buyers.

The top 10 cities for single-family permits in 2019 so far are:

  1. Phoenix – 3,393 (3,087) +
  2. Buckeye – 2,068 (1,856) +
  3. Unincorporated Pinal County – 2,009 (2,285) –
  4. Mesa – 1,728 (1,649) +
  5. Maricopa – 1,608 (1,098) +
  6. Surprise -1,414 (1,170) +
  7. Goodyear – 1,368 (1,118) +
  8. Queen Creek – 1,220 (1,112) +
  9. Peoria – 1,187 (1,099) +
  10. Gilbert – 998 (1,262) –

Opinion: As we’ve reported in these last few issues, we believe the Phoenix metro communities are on the verge of a major price escalation, at least all signs seem to be pointing in that direction, and now being confirmed by local and national statistics.

How would I know? Well, frankly I don’t know for sure, but I’ve seen some market similarities in four decades in this business. What would surprise me, however, would be if this market didn’t escalate.

About the Author
Michael Bodeen, Associate Broker

     I was born and raised in San Rafael, California, from the mid 50’s to the early 70’s. I had super parents who worked hard to provide 5 kids with a good Catholic education – despite my best attempts to overthrow the knuckle-cracking regime of Sister Mary Anselma. My dad worked as a self-employed butcher until his retirement at 65 and enjoyed many wonderful years until mom passed away in 1992.

     Dad passed away in the fall of 2006 having lived a great and full life into his early 90’s! In California, I attended college in Chico and Sacramento as a “Sosh” major, but like many of my contemporaries, I did not have a clue what I wanted to do when I grew up. Because of my age, I missed the Vietnam War and into my early 20’s I had many typical youthful indiscretions.

     Thankfully, that was a brief period of my life, and with greater thanks, not too much damage was sustained in those early and rebellious years. And by the way, those thanks are due to the answered prayers of faithful relatives who prayed for years that a wayward Michael would turn his life over to the Lord, and in January of 1982 that’s what happened.

     I lived in Sacramento, California in the mid 70’s, and later moved to Truckee, California, which is near Lake

Tahoe and Reno, Nevada. Truckee’s often labeled the “coldest spot in the nation.” Why did I move there?

My father-in-law was a real estate broker in Donner Lake, California, and despite his cantankerous disposition, he seemed very successful in his real estate endeavors. I joined him in sales in July of 1976.

    The Truckee and Lake Tahoe area was a wonderful place to raise a family, but a difficult and cold environment to live in, but we did so for 18 years. In 1994, my wife, Karen, and I visited Scottsdale at a friend’s request, and within 8 months, our family of 5 had relocated to “the valley” – or is it a desert? Whatever it is, it’s warm. At any rate, 24 years have gone by since we made the break from the late great state of confusion, uh, California, and it’s turned out to be a great move.

     As for hobbies, I enjoy family, friends and travel. My kids Robert, Kendra, and Jonathan are now 40,

34, and 31 respectively. I recently became “gramps” for the 4th time as well. It’s a nice time of life. Karen remains as lovely on the inside and outside as the day we were married. We continue to wonderfully grow together as the years advance. As an ordained Christian Chaplain, I volunteer Preaching at Florence Prison with Along Side Ministry. The ministry helps make the formerly incarcerated able to function, even thrive, on “the outside.”

     Should you choose to have me represent you in the sale or purchase of your home, you’ll be receiving my 40+ years of real estate knowledge, counsel, and experience (including negotiation experience).

    Beyond the transaction, I’m always available to you, should you ever need my real estate advice.