Our beautiful Arizona weather, with temperatures in the high 60’s to low 70’s it is no wonder people are buying up homes in Bullhead City, Fort Mohave and Mohave Valley. Inventory continues to remain low and multiple offers in all price ranges continue to be a regular occurrence for homes priced right.
Fourth quarter 2011 numbers are in, so we can make some year over year comparisons. For the first time since the start of this housing crash our median sales price stayed the same two years in a row at $114,000. It is too early to speculate that prices have stabilized but it is very encouraging news that at least during 2011 the price decline stayed flat.
The number of homes under contract was up 28% year over year in January 2010 compared to January 2011. This is not too surprising as we have been experiencing an influx of buyers having fewer homes to choose from. More good news, our inventory is shrinking as once again year over year comparisons, there are 11.9% fewer homes on the market in Bullhead City, Fort Mohave and Mohave Valley for buyers to choose from.
Playing with the charts today I thought I would take a look at year over year but looking backward 3 years. Wow, things are improving as the number of homes sales was up 31.4%, the number of homes on the market down 52% and the number of homes under contract up 19.9 % as well.
So what does this mean? Has the market corrected and is on the way to a slow comeback? What happens if the “Foreclosure Shadow Inventory” shows up?
Well we all know about opinions, but it is clear that the worm has turned. Sales prices continue to be the salt on the wound for sellers and the icing on the cake for buyers. The big question is how long will it take to see sales prices improve? When will the underwater homeowners begin to emerge from the perpetual dark depth of the ocean floor and see the sun light above the surface?
I’ll share a personal story with you today. Our 20 year old daughter is in escrow to purchase a small 2 bedroom home in Fort Mohave. It has been a long short sale wait and although the close of escrow is set for this month we are all anxious as we know when it comes to working with a bank changes can happen at the last minute. But the point of the story is that the purchase price is $72,000 and the required insurance coverage on the home is $128,000 for replacement cost (remember there is no land value as it is always there). So just think about it. That is a huge spread between what she is paying for the home and how much it would cost to build it. When the housing inventory becomes so low that our expert home builders begin to put sticks in the air, we know that these new homes must be sold for construction costs plus profit to the builder. (Builders are self employed entrepreneurs without a government bailout). So, for the rest of the existing homeowners out there, your values will increase too. It is just time and thankfully for Bullhead City, Fort Mohave and Mohave Valley, we may be finally moving off the ocean floor.
As always, thank you for your continued support and referrals. Without your continued faith in us and Real Living Country Ranch, our business would not be what it is today.
Michael and Petra Fahey
Avg. Sales Price: 12500
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