TRENDING REAL ESTATE NEWS_______________________
Luxury Home Prices Hit All-Time High; Record Number Cash Sales Recorded
Luxury home prices hit an all-time high to end the year with the typical U.S. luxury home selling for a record $1.17 million, up 8.8% from 2022, according to a new Redfin report.
The price of luxury homes rose twice as fast as the price of non-luxury homes at the end of last year and a record share of high-end buyers paid cash for those purchases. Non-luxury home prices rose 4.6% year over year for comparison. Redfin categorizes luxury homes as those projected to fall within the top 5% of their specific metropolitan area in terms of market value. Non-luxury homes are identified as those expected to be within the 35th-65th percentile based on market value.
In Phoenix, luxury home prices rose 4.8%, while new listings grew 42.3%.
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Scottsdale Housing Market Trends and Forecast for 2024
The Scottsdale housing market is one of the hottest in the country, with home prices rising steadily over the past year. The median listing home price in Scottsdale is now $1.1 million, and homes are typically selling for 2.73% below the asking price. However, there is still a strong demand for homes in Scottsdale, and inventory is low. This means that buyers need to be prepared to act quickly when they find a home they love.
Scottsdale, Arizona is a vibrant city with a thriving real estate market. Whether you’re looking for a luxurious estate or a cozy starter home, Scottsdale offers a range of options. Scottsdale is a suburb of Phoenix, sitting on the eastern side of Maricopa County. It is overshadowed by Phoenix unless you’re a golf aficionado or watch baseball. If you are an investor, Scottsdale has a track record of being one of the best long-term real estate investments in the nation. Let’s discuss about the latest trends in this market.
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MARKET UPDATE_______________________
The Spring Housing Season is Upon Us
What’s Hot and What’s Not in Greater Phoenix
“That is one good thing about this world… there are always sure to be more Springs.” ~Lucy Maude Montgomery
Spring is peak home buying season in Greater Phoenix. March is the 2nd most popular month for new listings historically (the most popular is January), and the beginning of a 4-month long closing season that lasts until June. Supply is up 14% over last year, still 31% below normal, but 16,886 active listings feels like an avalanche compared to 2 years ago when there were only 4,400 to choose from.
Higher mortgage rates continue to keep buyer competition lower than normal, but even mild declines in the rate have resulted in a boost in weekly accepted contracts. Closings over asking price have edged up seasonally to 17% of March sales so far, but the majority of sales are negotiated down by an average of 2.1% below list.
Builders have been ramping up new single family home permits over the past 7 months, up 32% since June 2023. Over the last 3 months, 73% of new home sales closed have involved builder incentives paid to the buyer, with at least 50% paying $11,500 or more. These incentives typically go towards buying down the mortgage rate and saving the buyer $100’s on their monthly payments.
Median Sales Prices
Those who have been keeping these updates over the past year have probably noticed that the median sales price has barely moved for 10 months. Starting at $440,000 from June-July 2023, stagnating at $435,000 from September-December, dropping to $430,000 from January-February 2024, and now back up to $441,000 in March. While the current appreciation rate from last March measures +5.8%, over the next 2 months this will start to move closer to 3%, which is in line with the rate of inflation.
This 10-month stagnation in price, which has endured erratic mortgage rates ranging from 7-8%, has allowed some breathing room for annual incomes to catch up to prices. While low affordability rates are leading negative headlines this month, they are largely based on 2021 median family income from the U.S. Census, which doesn’t reflect the influx of higher paying jobs, inbound migration fueled by the “work from home movement”, and private sector income growth experienced in Greater Phoenix in 2022 and 2023. Updated income reports combined with an expected mild decline in rates this year provide a reasonable expectation that affordability is set to improve. In short, don’t listen to affordability reports that say the majority of homes are not affordable to the masses. You only need to find the one home that’s affordable to you. Don’t give up.
For Sellers:
Spring is statistically the best time to be a seller in Greater Phoenix as buyer activity closes in on its seasonal peak from April through May before slowing down from June through December. This season some areas and price points have been heating up more than others compared to last year, but heat is not all about demand because it’s difficult to increase sales without supply for sale.
For example, areas with the highest percentage increase in contracts over the past 2 months happen to be on the edges of the Valley, such as Black Canyon City, Carefree/Cave Creek, Rio Verde, Sun Lakes, Wittmann, El Mirage, and Avondale. However, with the exception of Avondale, none of these areas feel particularly hot to active sellers because there’s more competing inventory to accommodate the increase in demand.
When supply is taken into account, the hottest areas of Greater Phoenix where supply isn’t quite sufficient for Spring demand gravitate to the south. Namely Avondale, Tolleson, South Phoenix, Ahwatukee, Chandler, Gilbert, and San Tan Valley. While median prices in these areas are still flat, reasonably-priced sellers are selling 1-2 weeks faster than the current 4-week median time frame.
Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2024 Cromford Associates LLC and Tamboer Consulting LLC
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FOR THE HOME_______________________
Before Co-Owning A House With Family Or Friends, Know The Pros And Cons
Homeownership continues to elude many would-be buyers. It’s still a seller’s market due to the lack of available housing. Additionally, this situation likely won’t change in the foreseeable future. Compounding the problem is the lack of affordable homes. At the end of 2023, the National Association of Realtors reported the existing home sales median price as $382,600. However, according to Census Bureau data, real median household income in 2022 was $74,580. (Note: real median household income is defined as the inflation-adjusted amount.)
According to a consumer report from RE/MAX, prospective home buyers are getting creative to achieve homeownership — and 28% would consider purchasing a home with family or friends. This tracks with a report by Pacaso, which recently identified the 10 U.S. counties with the highest year-over-year growth in co-ownership transactions (excluding married couples) from EOY 2022 to EOY 2023. Six of the 10 counties were in Virginia, and the rest were in Utah, North Dakota, Minnesota, and Colorado.
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LOCAL ADVENTURE_______________________
ACA Attracts Billions in Investment to Arizona
On Feb. 23, Sandra Watson, president and CEO of the Arizona Commerce Authority (ACA), spoke to members of Valley Partnership. Highlights of the ACA’s successful economic development efforts include the billions of dollar in investment coming to Arizona. As a result, Arizona has a growing profile on the international stage and new education opportunities to meet workforce demands.
Established in 2011, the ACA is a public-private agency and the state’s leading economic development organization. Recently, questions have arisen as to how the ACA spends funds relating to hosting CEOs for business attraction efforts. The agency is up for reauthorization under the state’s sunset review process and HB 2417 seeks to extend the ACA until July 1, 2028.
“We have seen tremendous expansion opportunities and growth in our semiconductor industry,” Watson says. “We are so fortunate with not only having Intel, one of the leaders in the semiconductor industry, but also attracting TSMC, which is clearly the global leader in the semiconductor industry.”
In the last two years, the investments from TSMC, Intel and 34 other semiconductor-related companies add up to $64 billion. These investments make Arizona the top state in nation for semiconductor industry growth.
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Scottsdale Symphonic Orchestra
2023 – 2024 CONCERT SEASON!
The Scottsdale Symphonic Orchestra provides affordable, professional quality live concert events. These performances uplift, inspire, and culturally enrich its audience as well as its members.
We are currently conducting a worldwide search for a Music Director. Our 2023-2024 season will feature the finalist candidates for this position as guest conductors for each concert. We will appoint a permanent Music Director for our 2024-2025 season.
Our mission extends beyond the stage to cultivate a culture of accessibility, inclusivity, and education in classical music. Grounded in the values of musical excellence, respect and kindness, we serve, inspire and unite diverse communities, fostering a love for symphonic music while nurturing the next generation of musicians and classical music audiences.
The Best Seats Sell Out First – Buy Your Tickets Today!
MARCH 24, 2024, 4 PM
Scottsdale Center for the Performing Arts
Desmond Siu, Guest Conductor
- Bernstein, West Side Story Overture
- William Grant Still, Mother and Child
- Florence Price, Dances in the Canebrakes
- White, Acadia Fanfare
- Dvorak, Symphony No. 9
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The Best Places for Easter Activities in Scottsdale
Decadent brunches, egg hunts and pictures with the Easter Bunny, and family-friendly events and activities. We have rounded up the top things to do this Easter weekend in Scottsdale!
Scottsdale’s chefs are dishing up decadent Easter brunches and multi-course prix fixe meals fit for the grandest celebrations! The annual Easter Brunch at the Fairmont Scottsdale Princess includes selections from all four of the resort’s signature restaurants. A major highlight is the Alice in Wonderland Easter Egg Hunt Adventure. Over at Hash Kitchen, kids can chow down on treats like Banana Split Brioche or Bread Pudding French Toast Sticks. However, adults might prefer the 50-ingredient Build-Your-Own Bloody Mary Bar.
Prix fixe feasts for this year include elegant three-course options at Sanctuary Camelback Mountain, a Gurney’s Resort & Spa, Royal Palms Resort and Spa and El Chorro.
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See something that interests you in this March 2024 Newsletter? Contact me and we can check it out together! Feel free to call me directly at 480-788-5446.
