September Real Estate Market Update for Cave Creek Arizona for August 2019This month is going to be a dive deep into the numbers of supply and demand in Cave Creek’s real estate market, so
Cave Creek Housing Market Update
September Real Estate Market Update for Cave Creek Arizona for August 2019
This month is going to be a dive deep into the numbers of supply and demand in Cave Creek’s real estate market, so buckle up. Without beating around the bush, let's just jump right into it: a lot of things have been going on in the cave Creek market lately. I have even seen other agents asking online in agent forums about what's going on in Cave Creek. They will post things like, “I don't seem to be able to get the same traffic I would in the price range I'm looking at. I'm not sure what's going on!” The fact of the matter is they are seeing lower final sales prices but continuing to list homes higher based on word of mouth opinions on the local real estate market and haven’t quite tuned into the number. The traffic is slower as a result and they can’t figure out why. There's currently a lot of things going on (as some of you may know if you watch or read my blogs and videos regularly). I talk often about how the market is shifting, we're in a little transition phase, and a lot of people really haven't caught on to it yet (unless you listen to me on the Regular). So, before I talk any more about that, let me just get to the nitty, gritty, details.
Our active listings in Cave Creek are down 5.5% over last year. There's currently only 205 Active listings in all of Cave Creek. For those of you don't know, Cave Creek, just has the one zip code which is 85331. It's just a couple blocks from my house where I am at in North Scottsdale - it's basically across the street and you're in Cave Creek. Therefore, the demographics are a lot alike and there's a lot of horse properties. There are still some planned subdivisions and things like that. But it's more of a small-town, quasi-rural feel out here.
Our sold listings are down 18.2% and our sold listings for the whole month of August was at only 63. Last year it was 77 sales that closed. So not only are our listings down, but so are sold listings.
Our median sale price per square foot is still up 6.1%. This means people are still tending to price their homes a little higher having not gotten the memo that the market is shifting. As a result, our current median price per square foot is $209.01/square foot. Last year it was $196.96. The interesting thing right now is that the number of months of supply is up 15.5%. This time last year we're only at 2.82 months of supply meaning we were in a pretty hot seller's market. Now we're at 3.25-month supply. That is still considered a seller's market. But remember, if you've seen my other videos where I discuss what makes a seller's market versus a buyer's market, you will recall that anything four months of supply or less is a seller's market. Four to seven-month supply is a more even and stable market. And then anything with eight months or more of inventory supply is a buyer’s market. Overall, as a whole for Cave Creek and the 85331-zip code, we're looking at 3.25-month supply. This means we’re creeping towards that four-month mark - pretty much right where I've predicted all this year.
But the good news is that it is still a seller's market. It is still just starting to even out a lot for a lot of the buyers which is great news for everybody. Buyers are happy when the playing fields a little more even. However, sellers are still getting more for their home - it's just that you know if the comps are at a certain height and price, you may be pricing a little more in line with the last comps or just below as opposed to ast or above the last highest comparable sale. That is something to keep in mind when pricing your home competitively – especially in the higher end markets.
As I have said before, if you are interviewing agents to list your home, one of the best ways you can gauge if that agent knows how to price your home properly, is if they know how to calculate the number of month supply for your neighborhood and how to apply that information. There is a big difference between an agent who knows how to calculate those numbers for your specific neighborhood versus one who is going by the word-of-mouth, what they see on the news, what they heard from another agent, and second-hand information. You really want somebody who knows how to dive deep and crunch those numbers for you.
Another number that is down this month is the median days on market. Median days on market (MDOM) is down 18%. This means if your home is still priced appropriately, it is going to sell and it's going to sell quickly. Our MDOM right now is currently 50 days. The 90-day mark is considered an even/stable market. We are currently at 50, so anything less than that is still a pretty hot housing market. You will likely continue to see that market condition over the next couple months, especially in homes under $500,000. We will simply be seeing a return to a normal economy and a normal market as opposed to the highs and the lows that we have seen in the last decade. That is just one more thing to keep in mind.
This month I broke down supply and demand by price point as well. One of the things I have noticed is that there are some large breaks in price ranges in Cave Creek and most of the North Valley. Unfortunately, I am also seeing quite often right now where many agents either really being honest with their clients or simply have not really seen the numbers for the area and are now pricing homes a little too high and in the long run selling for less. Many of these are numbers you're not going to see on the nightly news because we all know that “if it bleeds it leads”. Therefore, numbers aren't sexy, the truth isn't always sexy. As a result, it is not going to be on the local news.
What we're seeing in Cave Creek is that between the $200,000-$300,000 range there's a two-month supply which is lightning fast. In other words, you put it on the market and in a matter of weeks or even days, you've got an offer and 30 days later you're closed. That's great news for Sellers in that price range. The entry-level market for a Cave Creek is right about the $300000 mark and anybody trying to get in and buy a home under that number is going to have a lot of competition. There is almost no inventory under the $200,000 mark. There is almost nothing regardless of the home type in that price range, so that's one thing to keep in mind especially if your home is in the $200,000 to $300,000 range. It doesn’t matter whether it's a single-family home, condo, townhouse - doesn't really matter.
The next bracket is the $300,000 to $500,000 range and that has a less than two-month supply. That price range is really the sweet spot for most of Cave Creek. There are so many people that want to be out here, but inventory is limited, and the entry level price is a bit higher than the rest of the Valley. Most of the buyers are between the $300K to $500K mark. In many of the more desirable neighborhoods in in Cave Creek, $350,000 is about the lowest price point that they can hope to get for a 3-bedroom, 2 bath home. Especially if you live in a neighborhood like Tatum Ranch, for example. After the $500,000 mark there are less buyers, so things change.
From the $500,000 to $700,000 mark there is roughly a three-month supply. This price range is creeping towards the four-month mark, which is where things start to even out for buyers and sellers, making it a more level playing field. That is something to keep in mind.
The $700,000 to $1 Million price range is currently at a seven-month supply. That number has gone up, so Seller’s need to keep that in mind when pricing their home. We do have a lot of high-dollar, large properties in Cave Creek. We have a lot of horse properties. Many of those are custom homes on three-quarters of an acre or full acre or more. If your home is in that price range, you're looking at about a seven-month supply of inventory. That indicates an even market, but trending towards a buyer’s market. We are likely going to see this continue to go in that direction. It is imperative if you are considering selling a home in that price range, to make sure that you're pricing your home just at or even just below whatever the comparable properties are.
From the $1 Million to $3 Million-dollar range there is an almost a 14-month supply of inventory. It is (for some) crazy to think of taking over a year to sell your home. But that's currently where the supply is but not a whole lot of demand so if you're getting ready to sell a home in that price range you will want to make sure that your home is the prettiest one on the block, that it has the most attractive price (and by that I mean price it below the comps for as high as you can get away with in relation to your payoff needs) simply due to the fact that you have got so much more competition. Just another thing to keep in mind.
Right now, most sales in Cave Creek are happening in the $300K-$500K range. If you're looking to sell one of those homes in one of those easily attainable and desirable neighborhoods that's great news for you. You are in a seller's market.
If you are over that $500,000 mark, you are in an even market and trending more towards a Buyer's market, but not quite there yet.
If you are in the $1-3M price range, you are in a strong Buyer’s Market with a 14 month of supply.
As a native Arizonan with expertise in data mining and strategic analysis, Dusti Martin is well versed and has put her skills to use for over 5 yrs helping clients find the best deals in real estate a....