The Fountain Hills market is simmering gently on the back burner, just short of a full boil. Residential sales during the 2nd Quarter, while not as strong as the same period in 2013, still posted total volume that is the third highest quarter since 2007, during the height of the market.
Fluidity in the market appears to be tempered by some good, old-fashioned and conservative practices that keep the market–and values–from rocketing skyward, but still strong. Lending, while easily available and very affordable, places strong requirements on the borrower to prove their ability to repay a loan. Recently, we also began to feel the effects of the Dodd-Frank Act, in particular affecting Seller Carry-backs, a segment of our market that often provided a safety net for buyers and sellers who wanted to take advantage of the tax and income benefits(sellers) and lower lending costs and restrictions (for buyers) afforded by a Seller carrying a note against their real estate.
As you will see on the following pages, Prices of Homes remained somewhat consistent (and on the rise, depending on the period of time you use to analyze the data), yet there are 29% more homes on the market than one year ago and less homebuyers–23% less for the 2nd quarter ending 2014 compared to 2013. These trends follow first quarter, 2014.
There has been some media emphasis on affordability in the marketplace. While it’s true that only 34% of our residential inventory is below $300,000, there are still 35 homes and 74 condos under that price point. Many of them could use some updating, but they are often on large homesites (single family) or in solid condo communities that offer upward appreciation for those that would like to build sweat equity. Many of them have already been nicely updated. So, instead of feeling that affordability is a serious issue, we believe that consumer confidence and education is more the culprit. We believe that many in the affordable housing market don’t believe there are programs for them or that they need more cash than they possess. On the contrary, there are exceptional lending programs available that offer 5% downpayments; Sellers will often provide closing cost assistance that reduces cash down payments, and we are even seeing a new conventional lending program that allows for upgrades/updates to the home that can be allowed in the mortgage.
The great news is that Fountain Hills is still a very attractive destination for home buyers of all ages. There is also a nice selection of larger homes with family-friendly floorplans and yards that are priced competitevely.
If you know a family that is looking to enjoy the quality of life in the community, encourage them to contact us at Sonoran Lifestyle Real Estate. Historically, Fountain Hills has always treated it’s affordable housing owners very well in a reasonably decent market, and we see no signs on the horizon that indicate anything but. There are opportunities for equity gain that will provide a nice future for those with vision.
Click Here to view the SUMMARY Fountain Hills 2nd Quarter Market Analysis 2014. For a full Report that includes details on your SPECIFIC NEIGHBORHOOD…contact your Sonoran Lifestyle Agent at 480-816-5557.