The welcome humidity of the Arizona summer, albeit thick and sweaty and warm and generally out of character for our dry heat reputation, signals a light at the end of the tunnel for our 100-degree days and the coming months of absolute weather bliss where the parks will once again be packed with little feet and big bicycles, festivals and outdoor shopping and all of the creature comforts of an Arizona Fall.
Provided, that is, we can keep our not-so-friendly COVID-19 and its variant from joining the party.
And while the sloshy front yards and dripping porches make showing homes a little more challenging in the unpredictable monsoon weather, the fact that we even have homes to show is as magnificent as the reflection of a night time thunderstorm off the Superstitions.
In fact, Gilbert has 140 percent more available homes for sale in August than it did just last quarter – which might feel like a proverbial flood of supply to our land locked little town but it is still just a sprinkle in the bucket: we’re only sitting at about a two-week supply for a healthy number of folks trying to make Gilbert their home.
Similar to the majority of cities across the Valley, we’ve seen a steady increase in homes coming to the Gilbert market since mid-March with a fast-tracked plan to replenish our deficient supply over the last quarter.
With days on market still declining and prices rising another 7 percent since May, now might be the best opportunity that there has been all year to sell your home for top dollar and actually have somewhere to go.
While the feeding frenzy of the earlier parts of 2021 is likely over, homes are still selling for 102.87 percent of asking price – meaning that your average home in Gilbert is still receiving multiple offers, seeing full or partial appraisal waivers and some are still including lease backs for the seller.
Those lease-backs, however, are becoming slightly rarer and more reasonable in length.
Sales are down about 24 percent year over year and demand is just 70 percent of what it was a year ago.
That indicates the healthy level of skepticism that some of our Gilbert buyers have after several months of shockingly fast rising prices. It also may reflect a feeling of defeat from some of the fiercest negotiations we’ve ever seen in the Arizona real estate market.
As we head toward a more normal balance of supply and demand in Arizona, there will likely be a lot of erroneous assumptions about prices. That would include any major fluctuation in interest rates – which we’ve seemed to avoid for now.
There may also be an emotional disconnect for our sellers who have very quickly gotten used to double digit appreciation (and then some!) as compared to a more “normal” rate of annual appreciation like the 5 percent we saw in 2016.
While new construction will continue to struggle to keep up with a lack of readily available building supplies, turn-around times for build completions will continue to increase and prices will continue on an upward trend from the 15.4 percent annual appreciation our brand-new communities have seen in the last year.
Quick move-in homes are hard to find but are becoming more readily available. We’re starting to see many builders incentivize buyers again – which is a welcome change to the buyer experience that has mostly included window shopping only without anything to show for it.
With inventory tripling in some of our outlying cities, the active adult and luxury communities are still strapped for available housing. And with second-home buyers returning to the market from cooler climates, it’s going to take quite a bit more supply for us to see any flattening of housing prices.
But this is a town dubbed the city of the future with a brand-new gateway to Gilbert’s Heritage District, enhanced training opportunities for our first responders at our state-of-the-art public safety training facility and a strong #gilbertkindness campaign. It should be a HOT place to live. (All puns intended.)