We have heard a lot in the news lately about what's going on in the nation in terms of inventory levels. No different than a lot of the other areas of the country, the inventory levels in Prescott actually did not start going up in March as we might have anticipated. We rolled into February with 589 total site-built single family home listings for sale. As of March 1st, that number had dropped to 537.

So why is this happening?

Inventory is a battle across the country, as our buyers frequently tell us. I read a study that 99% of homeowners in the US have an interest rate at or below the current rate. So unless you are a motivated seller that has a really strong reason to move, a lot of homeowners are choosing just to wait this out.

Speculation still continues that we are going to see some relief on rates later this year. So if you are a buyer, the message I would like to give you is that this is not such a competitive environment as you may have been accustomed to in the past couple of years.

Remember that saying: "You marry the property and you date the rate." So if you're asking yourself if now is the right time to buy or not, I would look at long-term real estate investing.

Right now it's a much more friendly environment for a buyer. You are not having to waive appraisals or do a lot of those things that we have become so used to over the past couple of years.

So focus on finding the right home for you, and we would be happy to help you do that. From there, remember that there are also options of buying down the interest rate a little bit. You could explore a 3-2-1 buy down option with our lender Elevated Mortgage. Then, once those interest rates do come down, you simply refinance. Look at it as more of a long-term picture.

Let's talk locally just a little bit more.

Our inventory right now is remaining at about a 13.5 week supply, 3.3.months. This is quite an interesting market that I've not seen in my career where the inventory levels are low and interest rates are a little elevated.

And when you look at the number of pending Prescott area homes that went under contract last month, compared with Februry 2022 when the market was on fire, our demand only slipped by 14%.

Existing home sales in the US, they say, plunged to the lowest level since 2010. Well maybe Prescott is a little bit different!

You have to be careful about what you read and hear. Whether you are a buyer or seller, what I would focus on is what is your true motivation?

Are you looking at this long-term hold? You can talk about interest rates coming down at a later time if you are a buyer. As a seller, as long as you sell and reinvest in a market, there's a theory of relativity there.

Now lets talk about the values. These are holding pretty constant.

Prescott experienced a neglible 1% drop in February and Prescott Valley rebounded with a 3% rise that can probably be attributed to some of the brand new homes that are being sold there at elevated prices. MLS-wide we saw a 1% drop. Chino Valley is a little more volatile as one big or small sale can skew the numbers and it experienced an 8% drop last month.

In summary our market remains at about a 3.5 month inventory level and we are here to help you, whether you are buying or selling. We can go into the details about what's right for you, so give us a call at 928-237-4425. We're happy to assist in any way we can.

Let's have a great month!

Geoff

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