Flagstaff Real estate market data, AZ Provided by Kelly Broaddus of The Kelly Broaddus Team of REMAX Fine Living
Flagstaff Housing Prices Soar, Up 4%
Spring season is almost here and with it the home buying and selling season in Flagstaff. Looking back at last year's blog, the headline is almost unchanged- Flagstaff housing prices continue to climb. The median home price in the greater Flagstaff region spiked 4% in February to $346,500. It was at $334,000 in February 2015. While this might spark concern for buyers, the rate of increase for Flagstaff's median home price for this period (4%), is actually way down compared to February 2015 double-digit gains of 23%.
The highest Flagstaff median home price recorded was in 2006 when it hit an all-time high of $379,000 while the lowest was recorded during the market crash in 2012. The current median home price has climbed way up from the lowest recorded value of $252,000 but is still down from pre recession peak. We still have a ways to go before we reach the peak, now that growth rates have slowed down to more normal levels.
According to the Northern Arizona Multiple listing service, sales volume is up from 43 in February 2015 to 44 total home sales in February 2016. The average price per square foot climbed double digits, 15% to $188.
Inventory of Homes for Sale
The biggest challenge is still the lack of housing supply in the lower price ranges. There are only 292 homes for sale in the greater Flagstaff region that are not currently under contract. Within the City limits that number drops to 106. When we view supply and demand from a price perspective, the shortage of listing is readily apparent below $400,000. If you are a buyer looking for a home in the $200,000- $300,000 price range, there are significantly fewer homes to chooose from with ony 1.8 months supply of inventory of homes for sale. Supply of homes at the $400,000 to $600,000 is at normal levels while above this price range, it's a "buyer's market" with over 10 months supply of homes.
Flagstaff has a limited housing pool. 2015 saw a large increase in the number of homes built due to greater demand of buyers looking to move to a larger home. However, home builders have not yet caught up with the demand for more affordable housing just yet. New construction home prices typically start at $320,000.
The demand for affordable housing in Flagstaff is expected to rise in the next several years. Student population in Northen Arizona University is projected to go up. More people from outside Flagstaff are buying second or vacation homes. Majority of these buyers come from Phoenix/ Scottsdale area looking to escape the heat.
Opportunity for Buyers
Rents are really high. It has become increasingly difficult to find a nice rental in Flagstaff. If you can afford to buy you’re going to be better off. Average rental rate is up by about $1,527.
Even with the high and increasing housing prices, mortgage interest rates are still pretty low, which can make getting a house affordable. Residents looking to buy can find something if they’re a buyer with good credit. Mortgage rates are still near historic lows. A 30-year fixed rate is still at 3.5% unchanged from last month. It was at 3.7% the same period last year.
“Even though home prices are climbing far above people’s income, exceptionally low mortgage rates have permitted people to buy a home without overstretching their budget. For someone making a 20% down payment, the monthly mortgage payment at today’s mortgage rates would take up 15% of a person’s gross income. During the bubble years, it was reaching 25% of income. The long-term historical average is around 20%. Therefore, a middle-income household does not need to overstretch their budget much if at all to buy a typical home.”
-Laurence Yun, National Association of Realtors Chief Economist
Shop for a mortgage. Not all lenders are created equal. You might be surpised that you qualify for downpayment assistance, or zero downpayment or low downpayment programs available for Flagstaff homebuyers. Check with your current employer if they provide Licenced Loan Originators or lenders can help you get qualified for the right program. Contact your realtor for a lender recommendation that will assure you of a smooth and hassle free closing of your real estate transaction.
Opportunity for Sellers
“Don’t wait too long to list. Remember: You want to be on top of the pile!”
– Dr. Skylar Olsen, Zillow Group senior economist
It is considered a seller's market for homes priced below $400,000. Listing your house now will allow you to capitalize on the shortage of homes available. If you are selling at this price range, expect your home to sell faster than average which is approximately 4 months.
Many homeowners are still hesitant to sell because they are undervaluing their home equity. Contact a real estate professional to evaluate your home equity and get your home sold at the best price with the least amount of hassles. Want to sell more than just average? Listings sell quickly when priced right, and may sell for more money when listed at the right time. If a home is overpriced, the seller will have to be very patient and wait for the right buyer. Priced too high, a home will probably end up being cancelled or expired if pricing is not adjusted.
Flagstaff Home Values Up 11%
Flagstaff home values appreciated at double digit rates for the second year in a row according to data released by the Coconino County Assesors Office. Last year, home values jumped by 13% and this year it went up 11%.
The Equestrian Estates, Flagstaff Ranch and Lockett Ranch area saw the largest median increase in value, 24.54 percent over last year’s median value of $411,345 to $512,306.
Two neighborhoods in the Flagstaff area saw a decrease in their values. The Valley Crest/Peakview area saw a decline of 0.91 percent in their values over last year. The University Meadows, University Park, Point North, Franklin Condos and Elden Townhomes area saw a 9.07 percent decrease. These declines were not caused by the market, but were a result of the Assessor’s Office changing the boundaries of these areas.
Expect to see home price appreciation slow down and level out to more typical growth rates this year. Home Price Expectation Survey by Pulsenomics reveal that home values will appreciate by 3.7% over the course of 2016, 3.3% in 2017.
Real Estate Trivia
$4,100,000- Price of the most expensive single family home sold in Flagstaff in February 2016. This luxury mountain retreat is located in the one of the most exclusive golf community in Flagstaff- Pine Canyon. At almost 12,000 square feet, this is also the largest property sold in the area. Can you believe this mega mansion sold in less than 10 months?
$405,000 - Price of the most expensive condominuim unit sold in Flagstaff in February 2016. This 3 bedroom 2 bathroom condo came with a $30,000 Social Membership to Flagstaff Ranch Country Club
$88,000- Price of the most affordable home sold in Flagstaff this February. A 2 Bedroom, 1.5 bathroom mobile home located in delightful Kachina Village close to hiking trails and minutes to downtown Flagstaff
1,166 days on market- It took more than 3 years for this 3 bedroom 2.5 townhome in Rio Homes Development to sell. The new homeowner had to meet the income and eligility requirement set by the city in order to buy the home.
Looking for a real estate agent to help you buy your dream Flagstaff home or sell your Flagstaff real estate? We would be honored to assist you. Kelly Broaddus is one of the top real estate agents in Flagstaff with affliations to both Flagstaff & Sedona MLS. Backed by REMAX Fine Living one of the top real estate brokerages in Flagstaff. Please contact us at 888.446.5602 or email email@example.com.
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