Having a sense of the current real estate trends can be helpful as you consider if you want to buy or sell a home. Whether the market favors buyers or sellers, for instance, could be enough to push you toward listing your home or waiting for the tide to shift.
As Arizona’s most exclusive area, Paradise Valley is home to a housing market that has been anything but stagnant to start the year. With custom homes covering the landscape of exclusive, gated communities, buyers will need to act quickly to secure the home with the features and views they covet. At the same time, the market is not as red-hot as it has been over the past few years. This shift has helped ease the pressure on buyers to pay top dollar without getting everything they want. Below you will discover some of the latest trends in Paradise Valley real estate and tips for how to navigate the market.
Housing prices continue to rise
Many exclusive Arizona communities saw population growth and housing price spikes in recent years. The Paradise Valley real estate market saw growth during the height of the pandemic when city dwellers wanted properties with more outdoor living space during periods of quarantine. Warm weather, abundant sunshine, and natural beauty made the Sunbelt an attractive place to relocate for those tired of being isolated indoors.
In fact, with median listing prices above $5 million, Paradise Valley has grown to become the 50th most expensive zip code in the country. While Paradise Valley may have emerged as an in-demand Sunbelt enclave in the past two years, even the hottest markets have cooled in 2023. Despite some cooling, home prices
still are up by 3.8% in 2023 versus a year ago. And houses above the five million mark have seen some of the biggest growth in sales and appreciation, as well. Do not be surprised if housing prices continue their gradual uptick.
Mortgage rates may slow sales
Interest rates were at rock-bottom lows in 2021, but they have inched higher in the past two years. Consequently, some potential buyers are wary of making a move in the current market in hopes that these rates will drop closer to the historic lows of 3% or better. After all, higher mortgage rates translate to a heftier repayment amount in the long run. But are these potential homebuyers realistic in their expectations? Many experts think that they are not.
History does not suggest that rates are likely to retreat to the historic lows of 2021. Prospective homebuyers, however, have adjusted their expectations in light of those historic lows. A recent survey
indicates that most homeowners believe that normal mortgage rates should be under 5.5%. With current rates at about 6.4%, it may take some time before rates fall to perceived normal levels if they do at all. Some experts are predicting that rates could head closer to 5.25%
before 2023 concludes. Those looking to sell their homes may need some extra patience, a willingness to negotiate, or the flexibility to list their home when rates are lower.
Buyers may have the upper hand
As a buyer searching for homes for sale in Paradise Valley, you may have an edge in the housing market. That is because the Phoenix metropolitan area is expected to see growth among sellers. Right now, Phoenix-Mesa-Scottsdale has the third highest concentration of sellers
in the country. That translates to lots of options for buyers looking to secure the ideal new property.
Why does the Phoenix area have so many sellers? It’s largely a matter of timing. Because so many homeowners in the area are approaching a decade of homeownership, there is a stronger likelihood that these parties may sell their homes soon. In other words, prepare for some turnover in places like Paradise Valley. The National Association of Realtors determined that most people hang onto their homes for an average of nine years. As a result, buyers may be able to negotiate better deals to help move inventory in a saturated market.
Buyers who are willing to pay cash for their homes will have an edge, as well. This growing segment of the buying population may be better positioned over those who rely on a mortgage but are wary of current interest rates. Typically, working with cash buyers results in faster transactions.
Know what it takes to close the deal
When you receive an offer on your home, are you in a position to negotiate? The answer to this question may hinge on how the market is doing. With slowing sales and reduced prices on some properties, you may be wondering how much you will have to concede as a seller. As a buyer, you may see current conditions as a golden opportunity to get a better deal.
The end of 2022 showed that Paradise Valley did not experience a rise in seller concessions
on closing statements. By contrast, the rest of the Phoenix area saw growth in seller concessions. Concessions may include absorbing more of the closing costs or taking care of significant repairs before closing on the home. As a seller in a market that has cooled in the past year, you may need to be willing to take on more responsibilities during the negotiations.
Find the right home in Paradise Valley
Ultimately, investing in property in a desirable location is always a good move. You will reap the benefits of living in a location with high-quality amenities and increasing property values. Paradise Valley real estate may not be as scorching hot as it was a year ago, but it remains a sought-after community in a sought-after region. Working with experienced real estate agents
will help you arrive at a home in Paradise Valley that meets your needs.
The agents at The Karas Group
have the industry expertise and understanding of market trends to navigate the local market. You can expect a high level of professionalism and customer service as you pursue buying or selling a home in Paradise Valley. Reach out to us today
to learn more about how you can find the right property.