We are seeing some changes in the marketplace - more substantial changes than we've seen in several years.

We rolled into January with 821 listings on the market, as I mentioned last month. That was a higher level of inventory than we've seen in January since 2016. At February 1st, the inventory was at 869 single family homes on the market. It excludes condos, townhomes, etc.

There is really good news for demand. In January we had 224 single family homes go under contract. That is actually up 61% year over year, a pretty dramatic increase year-over-year in terms of pending sales.

Closings last month paint a little different picture. In January we had 141 total sales, so when you divide the closings into our current supply, we're looking at just over a six month supply of inventory in the market.

We always talk about the fact that a textbook balanced market is a six-month supply. So for the first time in a long time we're basically seeing a balanced market.

Now I do anticipate that this could be a relatively short window where we're seeing a six-month supply. I have noticed that showing activity is dramatically up and offers are coming in. So if that happens, what we're going to see is a rise in the number of closings, for the month of February, which should diminish that overall supply. But, for right now, the inventory is sitting at a six-month supply.

Let's talk about values just a little bit. Of the inventory, 397 homes are in Prescott, so roughly half, 199 are in Prescott Valley and 54 are in Chino. The rest are kind of spread out through the quad city area.

As far as those values are concerned, in Prescott, we saw a little bit of an increase last month, a little over 2%. Prescott Valley slid by about 4.5%, Chino saw an increase of about 2.75% and, for the MLS average, we went up 1.3%.

On days on market, this continues to rise ever so slightly. The MLS average is 77 days. Prescott, on the other hand, where the bulk of the inventory is, is running at 93 days. Prescott Valley is running at 59 and Chino Valley at 83 days. I am kind of anticipating that's going to kind of level off and maybe even start going in the other direction.

So what's the messaging?

Well if you're a buyer, and you're waiting for interest rates to continue to come down and you're waiting for more homes, here's some good news. We saw 7.25% interest rates during the month of January. As of early February, it's 7.05% and our lender has been locking in buyers, with some minimal costs, in in many cases in the mid 6% range.

That could be where some of this activity is, coming from, as well as the fact that with 869 homes on the market once again for February, we haven't seen those numbers since 2016. And so if we're starting at 820 and 870 in January and February, that upward curve of inventory coming on the market has already started.

I'm not going to predict the future, I want to be really clear about that, but I would anticipate that if the trend continues and, if history is any guide, it looks like we could see between 1100 and 1200 homes on the market. If that happens, we haven't seen that since the 2015 market. So buyers, it looks like you're going to have lots of options as we go into the spring and summer.

Interest rates have settled down a little bit, they're at 7%. Talk to your lender. Talk to our lender about what options you have to get that interest rate down into the mid to upper sixes. There are some wonderful properties coming on the market right now.

Sellers, there's a lot of inventory coming on the market. If you are contemplating selling your property this year, let's get together and take a look at what the value of that property is right now and try and get ahead of this onslaught of new inventory coming on the market.

So that's your update for February. I look forward to visiting with you soon. Thanks so much and have a great day.

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