I’m continually amazed at how real estate agents latch onto positive news, touting it on social media and even, apparently, emphasizing it in advising their clients and planning their businesses. Of course, we expect newspapers to try to sell newspapers with dramatic headlines like the one which appeared in the Arizona Daily Sun this week, “New Sizzle in Flagstaff Home Sales.” But, as professionals, we real estate agents should be a bit more cautious, as I try to do each month in my monthly Flagstaff home sales report on this blog. (Here is the latest Flagstaff Home Sales Report.)
There are some differences in numbers between these two reports just because we’re using different markets and times. I use sales in the City of Flagstaff and immediately surrounding areas from which people normally commute to Flagstaff. My report also focuses on single-family home sales and the newspaper seems to be using a total number that includes all types of housing. (I discuss the Flagstaff townhome, condo and manufacturing home markets separately.)
The apparently dramatic increase in the Flagstaff median home price is a direct reflection of two things: (1) inventory in the lower price ranges is very tight and (2) there has been some improvement in sales of higher end homes — which pulls the median higher. The bad news is that buyer demand has not yet returned significantly. We’re still selling about 25% of the homes per month that we sold during the boom market in 2006-2007. I don’t think it would be good news to go back to that furious pace of sales; however, it would be nice to see us at 50% of that volume. It would mean that we have a significant number of people who can afford to buy a home in Flagstaff, and want to do so.
In sum, I don’t think Flagstaff is insulated or any super exception to the national housing market. Things are getting better for sellers, but “sizzle” is a little too much for me.