August Sales Update for McCormick Ranch

The summer sun isn't the only thing bringing the heat. What is usually a slow and sluggish season has turned out to be on absolute fire.

Like much of the metropolitan Phoenix area and Scottsdale, McCormick Ranch homes have been selling extremely quickly. This is due to two factors: limited supply and declining interest rates. And, it doesn't seem to be changing any time soon.

Over the last 6 months, we have seen a huge home buying spree due to dropping interest rates. This has continued throughout July even with news that the economy may be slowing down. Homes in almost all price ranges are being gobbled up, and McCormick Ranch is no different.

Also affecting this buying spree is that Maricopa has been announced as the fastest growing county in the country (!). There is a huge amount of demand not only from locals but those coming from California, the Midwest, and everywhere else.

When you couple that with very low inventory (there were just 69 active and available homes at the start of August), you start to see some fire works. With 55 sales in July, we only have 1.25 months of inventory. This is as low as I have ever seen.

Interestingly enough, we are mostly seeing this with single family homes. Condos prices had a big push over the past few years but have been very flat since then (although price per square foot is up). Townhomes and patio homes have been fairly even, as well. But single family homes have risen by around 9% in terms of price per square foot and 5% in terms of pure average price.

Moving forward, there are a couple of factors that can greatly affect what we are seeing.

First, is how long is this low inventory going to last? With so few homes to choose from, what is available will very likely turn into a bidding war.

Second, what will happen with interest rates? If they spike up we could quickly see demand shift and change. If they stay low for a while, the demand will stay high.

There were 45 homes under contract at the beginning of the month. So, we should see around 40 homes actually close. This still puts us less than 2 months of inventory meaning prices *should* shift a bit higher.

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Yours in McCormick Ranch real estate,

Randy