The last 5 weeks have shown the first significant bump up in prices in over 6 years. The median selling price of a free-standing home 5 weeks ago was $120,000. The median price now is $128,000. The last time I showed prices this high was February 2011. Inventories of homes for sale are down 40% from just two months ago. As I was running the numbers for the various local planned communities I was shocked by the lack of inventory in some of the most previously active communities. Silverado Ranch closed more homes last month than are on the market there today. Mountain’s Edge, probably the leading community in terms of home sales for some time, also has only around a one month inventory.
When I was doing the planned community updates it was also apparent that in almost every case the median price for homes currently listed for sale was increasing. Factoring in the increase in asking prices with the huge continuing reduction in inventory, I think that I can safely suggest that at least in the short run, prices here will increase.
In 2005, in the small gated section of the community I live in, Sun City Anthem, there were at one point 58 homes for sale out of a total of 226 inside the gate. At that point, for reasons that I really fail to understand, we all thought the party was never going to end for this market. Now in the entire community of over 7,000 homes there are only 93 on the market. Get ready for some higher prices. This will affect sellers probably more than buyers in that sellers are much more likely now to take a “wait and see” position much the same as buyers have taken for the last several years waiting for the bottom. The problem with identifying the bottom is that you can only identify it after the fact and that may well be where we are right now.
