A RECESSION? MAYBE, BUT IT’S AFFECT ON SEDONA REAL ESTATE WILL PROBABLY BE MINIMAL, AND HERE IS THE REASON WHY . . .
Sedona real estate is often said to be insulated from the national trends. The latest statistics from Washington D.C. indicate home prices were down nationally an average of 7% in 2007, the biggest yearly decrease since May 1991.
Merrill Lynch predicts prices could decline further by as much as 15% in 2008. If they are right, a lot of people who would like to sell their homes and retire to the Sunbelt are likely to find themselves in a bit of a predicament. So maybe now is the time to consider making the move, especially if your destination is Sedona.
For one thing, home prices in Sedona were down only an average of 5.6% in 2007, noticeably less than the national average. It’s not hard to recognize why there is a discrepancy. According to USA Today, Sedona is generally considered to be the most beautiful place to live in America, and therefore commands a premium price. It’s pretty obvious Merrill Lynch’s prediction for 2008 is not going to apply here.
The inventory of Verde Valley residences for sale has continued to decline from a high of 1747 units in October of last year to 1558 units in January 2008, a nearly 11% decrease in available homes. Add to that the unprecedented two decreases of .75% and .50% in Federal borrowing rates put into effect at the end of January, and you can see the reason why now might just be the perfect time for you to start thinking about staking out your own piece of red rock country.
Another possibility you might want to consider is investing in vacant land. Unlike the market for homes, the number of transactions involving vacant land in and around Sedona has decreased dramatically during the last four years, from 439 transactions in 2004, to 337 transactions in 2005, to 121 transactions in 2006 and a mere 72 transactions in 2007. Bear in mind that not only is land something we can’t make more of, but Sedona and a good part of the Verde Valley is surrounded by National Forests that limits the amount of property available for private development. It’s the old story of supply and demand, and right now potential investors are definitely in the driver’s seat.
Whatever you decide to do, be sure to first seek the advice of a seasoned real estate professional.
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