June was a wild ride, and a few months back no one would expect to be in the housing boom we are in right now. In the midst of the government shutdown, it is safe to say that house flippers who were using loans for investing did not expect to see these large returns.
With the ever turbulent nature of real estate, and in the peak of the summer season, we break down what our top trends for those using hard money loans for investing. Including the rising cities, the increasing supply problem, and more.
Rising Cities In Arizona
Avondale has held the title of the most improved CMI city for an extremely long time. Avondale features one of the lowest inventories and strong demand, making it hard to surpass.
Now that the Phoenix market is having record-breaking months, other mini-markets are stepping up to take the most-improved spot. 16 cities saw improvements in the past month, with the only city not seeing improved being Tempe, and still a strong seller market.
This squeeze making a bit harder for real estate investors to get their foot in the door, but those that are can making a killing.
Last month alone we saw cities improve in the double digits, with some even cracking improvements of 20%. With Supplies lower than ever before, finding the next rising market is a great way yo find your next big deal.
Rising Cities To Start Investing In
- Goodyear: Last month Goodyear saw an increase of 20% in the CMI alone. With over 300 listings active on the market, and only more room to grow. Average price per square foot for Goodyear was $147, an increase of 4% compared to the same period last year, and rentals even saw an average rise of $100 dollars last month alone, making it perfect for those using hard money loans for investing.
- Fountain Hills: Another heating market, Fountain Hills Increased to over 19% is the second most improved city after a record-breaking month. The median sales price for homes in Fountain Hills for Mar 27 to Jun 26 was $385,000 based on 277 home sales. With about 157 homes available, getting into this market may be a bit tricky, but the pay off promises to be worth it.
- Queen Creek: With a CMI Increase of 17%, and over 500 active listings, Queen Creek may become the next big investment hub in Arizona. Trends in Queen Creek show a 5% year-over-year rise in the median sales price, that features an average sales price of $360,950.
- Chandler: Sitting in the current #4 spot, Chandler had great growth last month as well, with an increase of 12%. Of the group, Chandler has the least amount of climbing to do to take over the number one city and is already strongly favoring sellers. Chandler is shaping up to be a great investment opportunity and has over 400 listings available, perfect for house flippers using loans for investing.
- Buckeye: With only an average CMI increase of 9% many may be surprised to see Buckeye Mentioned. With its ever-booming population, Buckeye is a market to watch and maybe the dark horse of the pack. Like all the other cities, its supply is below average, with only 372 listings showing. Buckeye offers a chance to start investing with less interference as the other cities mentioned.
Low Supply In Arizona
It seems like we have been talking about low inventory for years. Unfortunately, the numbers don’t lie. The Cromford report released this report, showing current markets inventory and supplies.
In Fact, to compound the problem, July only added 1,831 new listings during the first week of July across all areas & types.
This is down 8% from last year and continues the weak supply trend that started earlier this year.
That is not all, Mesa, Chandler, Glendale, Gilbert, and Surprise are all below 50% of their long term average. This is causing some serious issues for house flippers using loans for investing.
The Gap between supply and demand just keeps growing, having many people worried that this will cause the next crash. As supply continues to drop, 16 out of 17 cities are becoming more favorable for sellers. Which may make it harder to find the next houses for real estate investors.
Rental prices have also risen 42% since June of 2006. For Real estate investors, finding houses may be difficult, but renting opens much more opportunities. now is the time to rev up activity and to start using loans for investing.
Despite the low inventory, thee highlights actually spell good news for the real estate market as of now.
Silver Linings
- Interest Rates Are Mostly Low: Despite the mortgage rates being risen multiple times last year, earlier this year they were lowered slightly to a more reasonable level. With the real estate market continuing its record-breaking streak, and low supply, the interest rates are still reasonable for buyers looking for new homes.
- More Investor Activity: With the real estate market doing well, there are more house-flippers than ever before. This is good for buyers, looking for move-in ready homes. Real estate investors are buying less desirable properties, giving them much needed upgrades to make them more appealing to buyers. That means more homes with upgraded features and less maintenance for new buyers.
- New Buyers Are Still Entering the Market: As the economy continues to boom, new industries, and job entering the market not to mention millennial home buyers, and new buyers from California. In fact, almost 80% of California migration went to the Phoenix metro area, says Arizona Commerce Authority. These all make the home buying market even more competitive.
Loans For Investing
With such hot market activity, having the best loans for investing is vital. Using hard money loans make it easy to start investing. So what are the best hard money loans to use?
Top 3 loans for investing
- Fix and Flip Loans: Fix and flip loans are perfect for those looking to purchase, renovate and sell an investment property. Fix And Flip Loans are used to buy properties, make crucial repairs to bolster the home value and then sell for a profit. These hard money loans make it easy for house flippers to fund their properties as they cover the purchase, repairs and even the listing of different real estate investments.
- Home Rehab Loans: Home Rehab loans are used on properties that the real estate investor already owns to repair and upgrade the property. These tend to be used on rentals, to add new amenities or upgrades to make their property more appealing. They could also be used by investors who are looking to finance the repairs on a flip before putting it back on the market to make a bigger profit.
- Bridge loans: Bridge loans are used to fill gaps in funding for properties, and help real estate investors get the funding they need for their projects. This hard money loan is literally used to bridge the gap between fundings and help save properties from foreclosure. Commonly it is used to help refinance loans and get the funding sorted out.
Summary
Phoenix real estate is on the rise, and with fast-moving markets, and low supply, finding the next deal can be difficult.
- Rising Cities In Arizona: Goodyear, Fountain Hills, Queen Creek, Chandler, and Buckeye. These cities in Arizona are performing well, they could be great for your next investment.
- Low Supply: Arizona has fewer houses available than ever, but these are signs that the market is doing well. With a new generation of buyers, strong seller markets, and low rates it is a great time to start investing.
- Best loans for investing: Hard money loans make real estate investing fast and easy. Whether you need a fix and flip, or a bridge loan, you can find the best loan for investing here.
What do you think the next top real estate trend will be?
