Updated Oct 21, 2013 - 9:15 am
Homebuyer strike in Phoenix? Arizona real estate expert says it's happening
September is a very significant month for Phoenix's real estate market.
Exactly two years ago, Phoenix home prices bottomed out to their lowest levels during the housing crash. Two years later, a swift real estate rebound has pushed home prices up 40 percent, creating a high demand-low inventory situation that has left many prospective buyers frustrated and, at times, hesitant to get back into the real estate market.
This trend has been particularly apparent in September, a month that is historically quiet for home sales, according to Michael Orr, director of real estate, at the W.P. Carey School of Business at Arizona State University.
"I think we've got a little bit of a buyers' strike going on," Orr said on his weekly appearance on That Real Estate Show, Saturdays at 3 p.m., on News/Talk 92.3 KTAR.
"[Buyers are] fed up with not being taken seriously or given enough respect over the last few years. To them, prices seemed to have gone up very fast and interest rates, too," he said. "They're probably pretty fed up and want to sit on the fence for a bit."
Orr also believes negative media speculation about real estate "bubbles" and hidden housing inventory from banks have played a role in the "buyers' strike."
"They're going to need a little bit more encouragement. There's a certain amount of motivation and emotion involved in buying a home," Orr explained. "If [buyers] feel there's chance any of that negative stuff in some of the media is true, maybe [they] will want to hold off and see."
Orr doesn't see any reason for Valley homeowners to be concerned with real estate "bubbles," as have been projected by some national pundits, including prominent economist Karl Case of S&P's Case-Shiller Index.
"It's just not a bubble situation [in Phoenix]," Orr said. "It's almost laughable."
Despite all the bubble talk, Orr sees a more balanced real estate market for Phoenix, which could be good news for anyone participating in this "buyers' strike."
"Right now we're in a situation where (housing) supply is still pretty low, but it's increasing, so supply and demand are heading towards each other, which means the market is moving towards normality," Orr explained.
Whether that shift will cause Phoenix's disgruntled homebuyers to immediately re-examine their options remains to be seen, but long-term hope remains that many of these "buyers' strike" participants will strongly consider a move across the picket lines and into a new Arizona home.
Listen for more Phoenix real estate news with realtors Diane Brennan and Rod Lakin on That Real Estate Show Saturdays at 3 p.m. on News/Talk 92.3 KTAR.
Rod Lakin, That Real Estate Show