Pending Home Sales
With the quarantine in place, we shifted our primary focus to pending home sales to show what, if any, change we would see in the Flagstaff housing market. Because the average length of escrow for a home to sell can take 30-60 days it is hard to judge any immediate changes to our market by watching the sold homes. Pending homes sales are properties that a Buyer and Seller have mutually agreed upon the terms of a purchase contract. This is a much more immediate action in the market to allow us to evaluate the strengths/weaknesses of our market in the coming months. Not all homes that are pending close and are counted as sales. In any market, some pending contracts cancel during the inspection period, appraisal issues, or general loan qualification process. Looking at the pending bar graph above you can see we had 140 pending single-family homes in the Flagstaff area. We dipped a bit at the beginning of April with 127 and then bounced back up to 139 as of May 5, 2020. All things considered, this indicates steady progress in our market. In a traditional Flagstaff sales market, we see a steady incline in home sales as we transition from the winter months into spring and even more so as we hit our busy summer months. We anticipate the pending sales to increase throughout May and the rest of the summer. One of the many factors impacting this is the number of active listings available to Buyers. As of May 5th, we only had 70 active single family listings under $500,000. While this inventory is constantly revolving it does limit the options for buyers. Many of these are new construction which can take 4-12 months or more before completion. We know some Sellers made a decision to postpone listing a property until things begin to settle down with Covid-19. Our supply-side going into the crisis was low and has declined to below a 2.1 month supply or lower for homes under $500,000. Our entire market for single-family homes counting all price ranges is at 3.5 months.
We are seeing the higher end or luxury homes moving in our market with 10 homes pending that are over the $1,000,000 price range. If you are a seller who has been waiting for the dust to settle, you may want to reconsider your decision. Homes in Flagstaff are selling right now. We anticipate this to increase as the state and nation relax the stay at home orders. Add to this the anticipation of lower interest rates for mortgages and we are somewhat confident of a strong summer for Flagstaff sales. NATIONWIDE was a different story. While the National Association of REALTORS® will not release the pending sales report for April until May 28th they did report a 20.8% decline in pending home sales for all property types during the month of March. According to Lawrence Yun, Chief Economist for National Association of REALTORS® in the monthly pending home sales report, “The housing market is temporarily grappling with the coronavirus-induced shutdown, which pulled down new listings and new contracts.” Yun went on to say he anticipates an increase in buyer confidence and low-interest rates should bring an increase back to the market. He does not believe the increase will cover for the losses and anticipates a 15% reduction in sales volume for the year. With this, it is still anticipated to see a 1.5% increase in the median sales price nationwide with some variances in higher-end homes.
Flagstaff Home Sales for April
Single-family homes sold in April of 2020 were down from the same month in 2019. We had 62 sales reported so far on the mls for this April, down from the 77 sold last April. We are confident there is some impact related to Covid-19 but cannot accurately report exactly how much. We anticipate the sold properties to increase in the coming months. The median price for single-family homes sold in the Flagstaff area came in at $470,000 for April 2020. This is up to $42,000 from the April 2019 median price of $428,000. For April there were 16 townhomes sold and 10 condos sold. Nationally the sales number for April will not be released until May 21st. For March sales for single-family home sales were up 1.3% from one year ago according to NAR’s monthly sales report. The median sales price was $282,500 for the month of March for single-family homes nationwide. Be safe and call the Elite Team for all your real estate needs. Contact The Elite Team at RE/MAX Peak Properties – Give us a call at 928-440-1299 or send an email to [email protected] for experienced, professional advice on purchasing or selling a home in Flagstaff.