August's stats are here with some interesting indicators. Geoff Hyland gives us a new market update for the Prescott area.

We are continuing to see the transition from a very abnormal market that we all grew accustomed to in the past two-and-a-half years to what I would consider to be a normal real estate market.

I tell a lot of my clients that over the past two and a half years we were asking buyers to purchase a home in less time than most people take to buy a pair of sneakers. Right now we are seeing the average number of days on market is stretching out a little bit to about 40 days, which is typical of a more normal market.

On inventory levels, we started August with about 750 homes. We crested on September 1st at 800 and have been basically holding firm at the 800/810 mark.

To give you a little historical context, in September 2019, before Covid, we still had about 10/15% fewer homes available than we do today.

Overall, when you look at absorption rates, in July our pending numbers were down year-on-year by 40%. In August that figure was down 27% from August 2021. So those numbers continue to creep back up.

Interest rates continue to fluctuate. At the moment rates for a 30-year home loan tend to be around 7% (please note they have risen since we recorded this video).

We have a lot of buyers saying they are going to wait, because I believe a lot of them think the market is going to crash.

Now I'm not here to predict the future, but to tell you the observations that I see, based on my 17 years of selling estate right here in Prescott.

Back in 2010, we had close to a 25 to 27 month supply of homes here. Now most real estate experts would agree that a normal market is between five and seven months. Today we have a three and a half month supply of inventory.

Values have dropped between 10% and 15%, depending on the municipality and price point. For August, they came down overall between 3% and 4%. So values are continuing to float down just a little bit.

With inventory, I feel that we are stabilizing. Historically throughout my career, Prescott inventory has been very cyclical, peaking in August and September and then starting to diminish,.

So, as a buyer, you have a better opportunity with more inventory on the market now than you are going to see in the coming months.

As a seller, you should start seeing other homes coming off the market, reducing your competition as we move into the fall and winter.

Also keep in mind that there are some tools you have to buy those mortgage interest rates down. We're happy to answer any questions you may have, regarding how you might be able to get some relief for the life of the loan or for, say, a 2-1 buy down, so that you can get the rate down to a more comfortable level at present, in the hope that rates will come back down at some point and you can refinance into a lower rate.

I want to emphasize that homes are still selling. A lot of sellers are discouraged through dealings with other agents and/or negative comments in the media.

I want to encourage you by considering that about 250 homes are selling monthly in the area. Here at The Hyland Group, we're selling one home per day on average - about 30 to 35 total per month right now. Inventory is still moving!

If you're a seller and looking to put your home on the market and getting it sold this year, give me a call and we can sit down and go through what the value actually looks like and see if it makes sense for you.

On the buyer side, be really careful about sitting on the sidelines too long, because I don't know that we are going to see an expansion in inventory that would lead to greater depreciation in value.

If you have any questions at all, whether you're looking to buy or sell, please give me a call on 928-237-4425. I'd be happy to help.

Have a great day.

Geoff

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