Local Market Update - November 2023
As we kick off 2024, we are constantly being asked “what is the real estate market going to be like this year?” Well, we believe the best way to navigate this market is to look at its current trends!
As of the end of November 2023, the real estate market in Prescott, Arizona, shows some signs of stability and an interesting “hold patten”. The median home sale price in Prescott has experienced a modest decrease of approximately 3% compared to the same month in 2022, however in the last 24 months Prescott has experienced a whopping 15.45% increase. This slight downtick in property values so far in 2023 is largely attributed to the quick rise in interest rates throughout the year.
November closings were down significantly, 40% compared to
November 2022 but this is clearly caused by the peak in interest rates in October. Surprisingly the median days on the market decreased to 27 days, a large 55% decrease, this could partially be due to the lower number of closed transactions as well as buyers trying to get close before interest rates possibly rise again.
Active inventory is down slightly, less than 1%, there were over 420 homes available for buyers to shop from. This temporarily puts our active inventory at about a six month supply, which means that we are experiencing a more balanced market between buyers and sellers.
The market is technically stable and balanced according to the numbers, but I would consider this market temporarily “on hold”, and we don’t expect this “hold” to last for too long. With the significant decrease in interest rates over the last two weeks and the Feds announcement of rate cuts coming next year, we expect buyers to start preparing to buy. This is evidenced by the fact that new mortgage and refinance applications have increased significantly over the last two weeks. The good news for buyers is that inventory available to buy may also increase in the spring because many potential sellers have been waiting for lower interest rates to be able to make a move. More buyers and more sellers at the same time should be positive for the market.
We expect the Prescott housing market to remain good for sellers and attractive to buyers due to the city's attractive blend of natural beauty, a thriving local economy, and a steady influx of new residents seeking the desirable lifestyle that Prescott offers. As we head into the end of the year, we anticipate that the market will continue to exhibit resilience, making Prescott an attractive real estate market for buyers and sellers.
Whether selling or buying timing and process can make a significant difference in your success and your wealth. Your home is usually one of the largest financial investments you will make. In fact, some studies indicate that more than 80% of wealth upon retirement may come from home equity. With that in mind you deserve to have the best financial steward working for you, someone that will handle every detail of your real estate transaction with the highest level of knowledge and experience. A person who has the passion, integrity, and discipline to protect your financial interest and put your interest above all else. Who you hire for this financial, life altering transaction really matters for your success!
