1. Supply & Demand
   • Unless you’ve been living under a rock, you know that Maricopa county (home to AZ’s largest cities like Phoenix, Scottsdale, Gilbert, etc.) is the fastest growing county in the country for three years running. This inbound migration is a key driver of the high demand for both renting and owning a home. The simple economics principle of demand exceeding supply continues to drive prices up across the valley. Valleywide we only have a two month supply of homes available for purchase meaning that if no other houses were listed for sale it would only take 60 days for all homes to be purchased. Yikes! 
2. Low Interest Rates
   • Last week the Federal Reserve dropped their interest rate by .25%. This is the first rate drop since 2008 and very important for consumers for a couple reasons. First, this means borrowing money becomes more affordable and you’ll be paying less interest on outstanding debts (think, student loans and credit cards). Second, mortgage rates have been at historical lows for a few months now in anticipation of the rate cut. If you already own a home and have above 4% interest rate you should explore refinancing. If you don’t own a home, these low rates will materially change your payment on a monthly basis and make homeownership more affordable.  
3. Strong Overall Economy
   • Arizona continues to have some of the strongest job growth in the country. As employment rises so does personal income. Increased personal income translates into higher consumer spending on both retail and housing. All of this means our local micro economy will be stable and growing. Of course, we are susceptible to the macro National trends, but having these important local metrics going in the right direction helps insulate us from some of the economic turbulence. 

So, if you’re one of the many people who say “I’m going to wait till prices fall to buy” you could be waiting for quite a while. In the meantime, you’re sitting on the bench and missing a great opportunity to improve your personal financial situation. Have more questions on this topic? Shoot me an email at lindsay@lindsayfricks to discuss!

Lindsay Fricks, Helping you, your family and friends Live and Love in Arizona!