So, What IS Coming in 2009 to the Prescott Arizona Real Estate Market?

I mentioned last week that we would take a look at the year to come in the near future, so wanted to dust off the crystal ball today, and see what we can predict. Or, lets say "suggest" might happen in 2009 in the Prescott, Arizona Real Estate market. We will take a look at 3 different aspects of our local market: 1.) Inventories 2.) Prices 3.) Interest Rates

First off, if you haven't looked at our inventory chart we put together that encompasses the last 3 years, you can take a look in at it HERE (and you will probably want to do that first). So, now that you have seen where we have been, we would suggest that inventories in 2009 will likely creep back up, but won't likely go much higher than the 2008 high of approx. 2700 site built homes. Currently our inventory has sunk to 2,315 homes on the market. So, you can expect stabilized inventories over 2009 when compared to 2008, which would point towards stabilizing prices.

Secondly, as just mentioned, we believe prices will begin to stabilize in the resale markets over 2009. This is good news of course, unless your pockets are full of cash. Which is likely not the case for most of you. If it is, please call us right away and we can difinitely help with that!

Lastly, regarding interest rates, our best sources are predicting that rates will remain stable over the next 1 to 2 quarters, possibly the lowest rates we will see in our lifetimes! The fed is likely cutting rates again, and we will likely see (actually already are) sub 5% rates with a point buydown. How does 5% translate when buying, say, a $200,000 home? Lets say with 5% down, and a 5% interest rate amortized over 30 years, your PI payment would be $1020! That is less than rent in many cases!

So, backing out and taking a look at the bigger picture, we have stabilizing inventories, truly record low interest rates, and stabilizing pricing in the resale markets over 2009! Sounds like a great year to me! If you are considering investing in 2009, don't wait until rates adjust back up, cause 1 thing is for sure, right now the gettin is good!