This month we're going to do things a little bit differently. I'm joined by Chelly Herren who's the COO of our company here at the Hyland Group.
One of the things that we looked at, that I was kind of surprised with, is the number of pending homes that actually went under contract in October.
We felt it on the team as well. We were able to put 41 homes under contract in the month of October, which was great for our little team here. But then on the market as well, kind of remarkable, there was an actual 35% increase in terms of the number of homes that went under contract in the month of October 2024, compared to 2023.
Now, when we sat down and did business planning with all of our agents early on in the year, I was asking them to try and have 80% of their production done by the end of September, because historically, in my career, ahead of a presidential election cycle, the market tends to slow down a little bit, and we didn't really quite see it slowing down as much as anticipated.
In fact there's an argument that, obviously by the numbers, it was stronger than last year for some reason. So I don't know if that's just consumers were ready for the election to be over and tired of being on the sidelines.
As far as values are concerned Prescott actually saw about a 3% decrease in values. Prescott Valley shot up about 3%. Chino Valley saw a moderate 1.5% gain. MLS-wide about -1.75% overall for the month. So, again, if you look at year-over-year, median pricing was pretty much in the same spot.
I fielded a phone call from buyers. And they said: "We're seeing all these price reductions, it looks like if we just hang on the market is coming down." I kind of slowed them down a little bit.
I said, so tell me what you mean by that. One of the things that they brought up is, well we're looking at listings all the time and it seems like a lot of them out there are reducing their price. And that's true. And so one of the things that I was letting them know about is that you've got to be careful looking at what actual values are doing, which is the pending and sold properties versus what's active on the market.
So, for example on November 1st there were 1009 properties on the market. So, that's still a lot. Historically it's higher than what we're accustomed to. But when you look at the demand, it's only a four and a half month supply.
I've said this many, many times here on this update that a normal market is six months supply. So it's just more than we've had on the market for the last 4 or 5 years and we're seeing levels that we haven't seen since like 2016. So it's great for buyers because there's lots to choose from.
Now when you look at the properties that are active on the market, they have been on the market an average now of 118 days. So the progression continues that days on market continues to go up a little bit. And, when you look at their pricing, they're averaging 14.5% higher in terms of a price per square foot or average sales price or listing price versus or relative to the average home in our MLS itself.
So there's a direct correlation with pricing 118 days on the market, 14.5% over what things are selling for. Whereas the days on market for those homes that sold last month is averaging an MLS-wide at 71 days. So that is ticking up a little bit.
We've been watching the progression from 55, 60, 65, now we're at 70 days or so. So we'll continue to keep you apprized on that.
As far as the inventory breakdown is concerned, roughly half of the inventory is in Prescott. There are about 215 in Prescott Valley and about 100 or so in the Chino Valley marketplace, and then the rest is kind of in our ancillary areas.
There's not a whole lot of good news to report in terms of the interest rates. 30 to 45 days ago, the interest rates were right at about 6.1%. That was just ahead of the Fed announcement, when they actually reduced the rates by 50 basis points.
As we turned into November, interest rates are now back up at about 7.1%. Rates are a little higher than what anybody would like to see right now.
The latest speculation is that we probably are going to see those rates come down. Now they're kind of saying early 2025. And so remember that you date the rate but you marry the property. So if you're a buyer out there and you're kind of on the fence, maybe you were waiting for the election to be over, I do think we're going to see some relief with interest rates in the not too distant future.
I think the overarching advantage that buyers have right now is that there's a lot more options to choose from than they're accustomed to.
As I said, we had a really busy month in October and a lot of our buyers are saying that they were pleasantly surprised because in some cases, they made offers on properties and if it didn't work out, they were able to go to number two and in some cases number three until they found the right fit with the seller.
If you're a buyer and you're wanting to target one of those homes that is overpriced, that's been on the market for a while, I think it just goes back to making sure that you're working with a really knowledgeable agent to make sure you're getting the best deal.
We talk a lot about this internally here on the team. Because, to be clear, if a property comes up on the market and for example, is within walking distance to the Downtown Courthouse Square and quintessential little cottage on Mount Vernon or something like that and hits the market today, if you go in there and offer 14% or under you're probably going to be met with a lot of resistance. So I think working with like a really knowledgeable agent from a really knowledgeable team that's moving a lot of properties is going to be able to guide you through some of those nuances.
But generally speaking the average home right now that's going under contract is taking about 70 days. So if you see a property that's been on the market for 120, 140 or even 160 days and it's on the cusp of maybe even expiring from the listing contract, it's very possible that they might be overpriced.
You have to look at how long has it been on the market. That's the first thing. Secondly, have they done one or two price reductions? And then your agent should be asking questions of that other agent and say: "Hey, I'm just kind of curious. Maybe we're in the running on two or three different properties. What's the interest level? Have you had any offers on the property? Tell me what's going on. What's the biggest objection?"
Asking some of those questions, depending on the agent on the other side, could reveal some really valuable tidbits to help you craft your offer and get the best possible pricing terms.
One other thing that we discovered this week is we had an agent on the team and there was a property where the seller had indicated originally that they were not wanting to compensate a buyer's broker. And what happened there is they went ahead and made the offer anyway and they asked that seller to pay the agent that we're representing the buyer to compensate them. And it was met with zero resistance and they paid it.
No problems? No. They were on the market for 150 days, but they were they were ready. So some of those nuanced questions might help.
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