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Douglas Trudeau , Assoc. Broker
Prudential Foothills Real Estate
64 N. Harrison Road, Suite 160
Tucson , AZ 85748
Mobile: 520-954-2209
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What Is The Real Story About The Tucson Real Estate Market?

Watching the news yesterday the average person would think that Tucson will turn into a ghost town. That real estate is on a decline. That buying or selling a home is hopeless. Not true. Reminds me of a professor who commented about the media be a great fertilizer. Lets see, the newspapers and the media depend on readers for sales and viewers to get higher ratings and sell more advertising space. Sensationalism is the key ingredient. Lets give the public what they want. Forget what damage it does to a vital part of our economical market.

True, there are way too many homes on the market. As of this writing there are 9,895 mobile homes, condos, town homes, and single family residences on the market through the MLS in the greater Tucson area. Consider the For Sale By Owners, and the number is higher. That is an impossible number to track though. Of those available homes 9,156 do not have an offer. Oops, 9,155 homes I had accepted offer for my Buyers yesterday that I have to turn in today. That means 701 homes are in various stages of process leading to the word all Sellers love, “Sold.”

True, current sales are not keeping up with the number of homes hitting the market. A healthy market based on the average number of monthly sales is somewhere between 7,000 to 8,000, depending on who you talk to. Until that time it will remain a Buyer’s market. When the number of available homes begin to drop or sales start shooting up, buyers will less opportunity to get great deals. When that happens, what will happen to interest rate?

True, interest rates are dropping again. The interest rates have dropped below 6%. Last time the greater Tucson real estate market experienced challenges similar to today’s interest rates were well over 8%. At one time as high as 18%. Now, that was a tough market for buyers, sellers and everybody tied into the real estate market. Once sales start picking up, anticipate that those rate will increase to over 6% again.

True, Tucson is a growing community. As more and more people move to Tucson the demand will increase. Builders have already stopped building spec homes, and sold off inventory at incredibly low prices. Forcing the new home inventory to drop. Working toward basic economics of reducing supply. Now we just have to work on the demand.

True, home buyer confidence is at an all time low. This is the key to the demand. Sellers have reduced prices, builders have reduced inventory, the Fed and lenders have reduced interest rates. Now is the time to take a serious look at the real estate market in greater Tucson and ask yourself, “Should I take advantage of the current situation and buy now, or should I risk waiting for it to get better?” Don’t get trapped into WSC (Woulda Should Coulda).

True, buying a home is a huge investment. That’s why buying what you can afford today and not what you think you can afford tomorrow is vital. Too many buyers anticipated increased value and higher pay. Too many bought on emotion without sitting down and counting the beans. Before buying, crunch the numbers. My suggestion, buy a little less than you can afford, stay in your home for at least five years, and thank God you have a roof over your head. For sellers, if you don’t have to sell, don’t sell. Level out the market so those who have to sell their homes can. Sellers don’t be greedy, sell for a win-win price. Investors, buy for five to seven year investments. Quit buying today to sell tomorrow. Draw your rents, maximize your write offs and do some long term planning.

The greater Tucson real estate market is not immune to what is happening nationally. However, we are not suffering as bad as many parts of our nation. With thousands moving to our community every year, its a matter of time for the market to level out and get healthy again. Ask yourself, “How many times have you let opportunity slip through your fingers, only to kick yourself later?”

This entry was posted on Thursday, January 24th, 2008 at 11:04 am and is filed under Real Estate News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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