We take a closer look at the reality of our local real estate market versus the national media picture.
As realtors, we are often asked by both buyers and sellers if it is a “good time” in our market. Those who remember the ramp up of 2006 are naturally fearful of a repeat performance. Are we approaching the high prices of the old days a decade ago? We thought we would look into this in more detail and examine how each segment of our local market is doing relative to the pricing at the peak of the market. It is interesting to note that different areas in the northeast Valley peaked at different times.
We originally thought to use an annual average, allowing us to avoid any sudden spikes or dips; however, it is more accurate to use a quarterly average to capture the data. These numbers reflect CLOSED sales only, not active listings or those under contract.
Homes larger than 3,000 SF are a distant ~50% from the price per square foot at the peak. In 2017 it seems, from an appreciation standpoint that smaller homes appreciate faster when their locations are closer to the city center. Larger homes on the outskirts are appreciating the slowest.
For our Sellers: While valley home prices as a whole have shown moderate increases, it’s important to note that some areas have fared better than others. The takeaway from this is the importance of proper pricing on our listings so that they sell, not sit on the market.
For our Buyers: It is definitely a good time for buyers to purchase. Current averages are still a far cry from the prices we observed in 2006/2007. This offers our buyers opportunities for more equity as home prices increase at a steady and reasonable pace, not like the manic ramp up we experienced a decade ago.
To sum this up, the dramatic spikes of 2006/2007 have been replaced a decade later with steady increases over a longer period of time, indicating reasonable appreciation, not a bubble.
**Data in the table above has been extracted from the Cromford Report, May 2017.