Real Estate in spring 2015 is off to a great start! Home sales in the Phoenix & Scottsdale Metro Area continue to increase & listing volume is trending lower than recent years: (3/11/15 Cromford Report)
March 11 – The number of active listings for Greater Phoenix (excluding UCB) is 21,829 which seems quite reasonable, if a bit on the low side. However the picture looks rather different when we break it down into price ranges.
Below $150,000 we have only 3,708 listings and the trend is sharply down. There were 5,754 on the same date last year and 4,372 as recently as January 20. Anyone wanting to buy a home is this price range is going to have an increasingly hard time. There have been 1,660 closed sales in the last 4 weeks in this price range, so today’s supply represents only 2.2 months of supply.
Between $150,000 and $250,000 we have 5,711 listings and the trend is sharply down. There were 7,500 on the same date last year and 6,428 as recently as February 7. There have been 2,345 closed sales in the last 4 weeks and the current supply represents just 2.4 months of supply. This is simply not enough to sustain a balanced market.
Between $250,000 and $500,000 we have 7,447 listings and the trend is fairly stable. There were 1,704 closed sales in the last 4 weeks, so we have 4.4 months of supply, adequate for the current demand but just a little below normal.
From $500,000 upwards we have 4,963 listings and the trend is for this total to move steadily higher. The closed sales total over the last 28 days was only 389. We have almost 13 months of supply for homes at or above $500,000. This is too many to allow sellers to feel comfortable. The number of active listings over $2,000,000 has started to climb down for its peak, but between $500,000 and $2,000,000 the count is still growing.
Some good news for higher-end sellers is that a recovery in the low and mid ranges tends to be a long term positive for the high end. In housing, the trickle concept works up rather than down.
For the visually minded, this is what it looks like in chart form:
||Mos of supply|
Note: >3 mos supply is considered a “Seller’s Market”, 3-6 mos supply is considered a “Balanced” & 6mos+ is considered a “Buyer’s Market”.
Which sellers should be really optimistic and which ones should exercise some caution?? As of 3/11/15, our median sale price in Maricopa County is $207,750, and likely represents a big chunk of the sales for our market. Sellers up to about $500K are looking really good. Those from $500K-$800K have also been looking good, but if you have a home listed at over $800K, don’t turn up your nose at the offers you’re getting. You’re halfway there, even standing out from the crowd amongst the competition!
If the “trickle up” theory is correct and “Millennials” (born 1980-1995) & “Boomerang Buyers” who previously owned homes but lost them to short sales or foreclosures during the housing bust) buyers are in fact driving sales, hopefully the trickle up will start showing at the luxury of the market before very long.
Stay with me and see whether the landscape will change again soon!
Related Pages & Articles: