Arizona Real Estate and Community News

Dec. 7, 2019

November Market Update

Market Summary for the Beginning of November 2019

We note that October 2019 contained 23 working days and October 2018 contained the same. There is therefore no need to apply any adjustments when comparing the 2 months.

So what are the numbers telling us?

  • The seasonal increase in active listings during October did take place, but was weaker than normal and much weaker than last year
  • Demand remains high, looking at listings under contract and pending listing counts, although it always declines due to seasonal factors between September and November each year
  • Closed sales are still well ahead of last year and were almost as high as last month
  • Sales pricing is finally beginning to take off and has a lot of upward momentum building

Although the Cromford® Market Index has fallen a little over the past month, the huge rise over the prior 8 months is now beginning to have an effect on sales pricing. This is as expected. The CMI is a leading indicator which tends to need 6 to 12 months before its movements are reflected in sales pricing.

Since there is little sign of supply increasing substantially, we can expect continued strong upward moves in sales pricing over the next 6 months. We should be on the lookout for any changes in demand but at the moment interest rate movements appear favorable.

Here are the basics - the ARMLS numbers for November 1, 2019 compared with November 1, 2018 for all areas & types:

  • Active Listings (excluding UCB & CCBS): 14,525 versus 17,953 last year - down 19.1% - but up 5.6% from 13,755 last month
  • Active Listings (including UCB & CCBS): 18,322 versus 21,311 last year - down 14.0% - but up 4.1% compared with 17,592 last month
  • Pending Listings: 5,919 versus 4,770 last year - up 24.1% - but down 1.5% from 6,011 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 9,716 versus 8,128 last year - up 19.5% - but down 1.3% from 9,848 last month
  • Monthly Sales: 8,018 versus 7,352 last year - up 9.1% - but down the tiniest possible amount from 8,019 last month
  • Monthly Average Sales Price per Sq. Ft.: $174.39 versus $165.41 last year - up 5.4% - and up 2.8% from $169.56 last month
  • Monthly Median Sales Price: $285,000 versus $262,000 last year - up 8.8% - and up 2.0% from $279,500 last month

If you or anyone you know is looking to make a move, Please let us know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com

 

 

(Previous Months Market Updates Below:)

October Market Update

September Market Update

August Market Update

July Market Update

June Market Update

May Market Update

April Market Update

March Market Update

February Market Update

January Market Update

Posted in Market Updates
Dec. 7, 2019

October Market Update

October 2019 ~ Market Update

The Cromford® Market Index stayed over 200 for the second month since 2005, but failed to rise further. The market remains hot and very unbalanced in favor of sellers but the situation did not get more extreme. This is largely due to seasonal factors. Between September and December we always see active listings grow each year. October in particular is a very popular month for creating a listing. However sales activity always declines steadily as the temperature cools, despite the influx of snowbirds, some of whom decide to buy somewhere, often in a spot more conducive to retirement or vacation rather than commuting.

In almost every year we have seen a move in favor of buyers during the period September to November, though the effect can be slight, moderate or significant. This year it looks to be slight, but it still exists.

We note that September 2019 contained 20 working days while September 2018 contained only 19. This gives September 2019 a 5.3% advantage. We should bear that in mind when looking at the large increases in monthly sales compared to September last year.

Compared with August 2019, September gave us

  • a slight increase in active listings
  • a noticeable drop in demand numbers (sales, pending, under contract)
  • very little movement in sales pricing
  • a large upward movement in for-sale pricing
  • a large upward movement in under contract pricing

The first 3 of these are to be expected every year in September. The last 2 are not so common and are the first sign of the significant up-tick in pricing that inevitably follows a major move higher by the Cromford® Market Index. It would be surprising if we do not see a corresponding move higher by sales prices over the next several months. Please don't say we didn't warn you.

Mortgage interest rates have plummeted since January creating an unexpected jolt of affordability into the housing market. In most circumstances, greater affordability translates into strong demand. However, there are now significant signs of weakness in the US economy (and the rest of the world). International trade disputes have a history of hurting both sides quite badly. In the USA, the manufacturing and agriculture sectors are probably the most exposed to unwelcome trends. The Federal Reserve will often cut interest rates in a faltering economy and if they do, and if these cuts translate to even lower mortgage rates, we could see continuing jolts of affordability for the housing market. If we are to enter a recession, then the housing market will not be the leading cause like it was in 2008. In Central Arizona it should remain in pretty decent shape as long as the current employment trends hold reasonably steady. Unlike last time, the Greater Phoenix housing market looks well placed to weather a mild to moderate economic storm.

Here are the basics - the ARMLS numbers for October 1, 2019 compared with October 1, 2018 for all areas & types:

  • Active Listings (excluding UCB & CCBS): 13,755 versus 16,819 last year - down 18.2% - but up 1.1% from 13,609 last month
  • Active Listings (including UCB & CCBS): 17,592 versus 20,303 last year - down 13.4% - but up 0.1% compared with 17,577 last month
  • Pending Listings: 6,011 versus 5,195 last year - up 15.7% - but down 5.3% from 6,350 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 9,848 versus 8,679 last year - up 13.5% - but down 4.6% from 10,318 last month
  • Monthly Sales: 7,987 versus 7,067 last year - up 13.0% - but down 10.4% from 8,913 last month
  • Monthly Average Sales Price per Sq. Ft.: $169.58 versus $161.31 last year - up 5.1% - and up 0.2% from $169.19 last month
  • Monthly Median Sales Price: $279,500 versus $260,000 last year - up 7.5% - but down 0.2% from $280,000 last month

If you or anyone you know is looking to make a move, Please let us know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com

 

 

(Previous Months Market Updates Below:)

September Market Update

August Market Update

July Market Update

June Market Update

May Market Update

April Market Update

March Market Update

February Market Update

January Market Update

 

Posted in Market Updates
Dec. 7, 2019

September Market Update

September 2019 ~ Market Update

With the Cromford® Market Index over 200 for the first time since 2005, the market is obviously hot and remarkably unbalanced in favor of sellers. Demand is some 8% above normal, which is strong but not too unusual. What is unusual is that supply is 43% below normal. We have had supply below normal ever since May 2011. but the weak flow of new listings has exacerbated the situation.

Active listings widened the gap compared to last year but declined much less in August than they did in July. Normally active listings grow each year between August 1 and September 1, so even though the decline was gentle it is not good news for buyers.

Listings under contract gained more momentum when compared with 2018 but fell sequentially (as is normal every year). Closed listings beat last year by 6.7%. August 2018 had the maximum 23 working days while August 2019 has one less so this comparison is biased in favor of 2018 making the 6.7% more impressive for 2019 - we are doing about 11% more business through the MLS than this time last year, measured in units. Of course the average price is up over the last 12 months so dollar volume is up by almost 16%.

Demand usually subsides between July and January every year so unless there a brand new trend develops we should see new listings maintain enough momentum to keep active listing counts from falling much further, if at all. However when demand grows again again in February we can expect a mad scramble. We will probably look back on 3Q 2019 and wonder how prices managed to stay so low. Based on existing data, the Cromford® Report expects a strong upward trend in closed pricing between October 2019 and June 2020.

Here are the basics - the ARMLS numbers for September 1, 2019 compared with September 1, 2018 for all areas & types:

  • Active Listings (excluding UCB & CCBS): 13,609 versus 16,222 last year - down 16.1% - and down 1.0% from 13,746 last month
  • Active Listings (including UCB & CCBS): 17,577 versus 19,831 last year - down 11.4% - and down 1.9% compared with 17,920 last month
  • Pending Listings: 6,350 versus 5,262 last year - up 20.7% - but down 2.0% from 6,479 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 10,318 versus 8,871 last year - up 16.3% - but down 3.1% from 10,653 last month
  • Monthly Sales: 8,810 versus 8,253 last year - up 6.7% - but down 5.8% from 9,348 last month
  • Monthly Average Sales Price per Sq. Ft.: $168.99 versus $161.27 last year - up 4.8% - but down 0.42% from $169.66 last month
  • Monthly Median Sales Price: $280,000 versus $262,000 last year - up 6.9% - and unchanged from $280,000 last month

If you or anyone you know is looking to make a move, Please let us know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com

 

 

(Previous Months Market Updates Below:)

August Market Update

July Market Update

June Market Update

May Market Update

April Market Update

March Market Update

February Market Update

January Market Update

Posted in Market Updates
Dec. 7, 2019

August Market Update

August 2019 ~ Market Update

The market is hot and becoming very unbalanced in favor of sellers. Demand recovered suddenly during the second quarter and has stabilized at a level significantly above normal. The last 2 months have seen supply drop sharply from its already low level, so we now have a wholly inadequate number of homes for sale to keep the market functioning normally.

Last month we noted the unusual drop in active listings (excluding UCB & CCBS), which fell to 4.1% below the 2018 level on July 1. On August 1 this gap has expanded to a startling 12.4%. Much of this decline was due to the low number of listings activated during July - 8,260 is our current count, the lowest number for July that we have seen since we started keeping records. With pending and UCB contracts up by 13 to 15% from last year, the supply has tightened dramatically. Where have all the sellers gone?

9,325 closed listings is another strong monthly total for July. The 9.2% growth over July 2018 is a little misleading, however. This is because July 2019 had 22 working days, so the number of closings per day was 424. July 2018 had only 21 days so 407 closings per day. The difference is 4%.

Dollar volume for July was $3.1995 billion. This is the highest total for any July in history.

Pricing is showing no excitement whatsoever, behaving as if the market was normal. This cannot last. Remember that sales pricing is a trailing indicator, often as much as 12 months behind the leading indicators. We expect to see fireworks in pricing over the next 12 months. In fact the current situation reminds us of 2004. The huge imbalance between supply and demand and the absence of distressed properties are very similar. The big difference is that 2004 was seeing large price increases and a significant number of the homes were being bought for resale by speculative investors and remained empty. The level of mortgage fraud in 2004 was also extraordinary. Hopefully that is not the case in 2019.

These are very interesting times, unlike the past 5 years which were stable and predictable.

Here are the basics - the ARMLS numbers for August 1, 2019 compared with August 1, 2018 for all areas & types:

  • Active Listings (excluding UCB & CCBS): 13,746 versus 15,686 last year - down 12.4% - and down 11.0% from 15,442 last month
  • Active Listings (including UCB & CCBS): 17,920 versus 19,415 last year - down 7.7% - and down 10.5% compared with 20,030 last month
  • Pending Listings: 6,479 versus 5,655 last year - up 14.6% - and up 0.6% from 6,642 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 10,653 versus 9,384 last year - up 13.5% - but down 5.1% from 11,230 last month
  • Monthly Sales: 9,325 versus 8,543 last year - up 9.2% - but down 1.7% from 9,483 last month
  • Monthly Average Sales Price per Sq. Ft.: $170.16 versus $160.79 last year - up 5.8% - but down 1.2% from $172.21 last month
  • Monthly Median Sales Price: $280,000 versus $265,000 last year - up 5.7% - and up 0.4% from $279,000 last month

If you or anyone you know is looking to make a move, Please let me know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com 

Saving You Thousands!

Saving You Thousands!

(Previous Months Market Updates Below:)

July Market Update

June Market Update

May Market Update

April Market Update

March Market Update

February Market Update

January Market Update

Information provided courtesy The Cromford Report.
Posted in Market Updates
Dec. 7, 2019

July Market Update

July 2019 ~ Market Update

The months of May and June 2019 were both exceptionally strong, especially considering the market was looking wobbly back in January

Let us start with the basics - the ARMLS numbers for July 1, 2019 compared with July 1, 2018 for all areas & types:

  • Active Listings (excluding UCB & CCBS): 15,442 versus 16,101 last year - down 4.1% - and down 8.5% from 16,869 last month
  • Active Listings (including UCB & CCBS): 20,030 versus 20,464 last year - down 2.1% - and down 8.1% compared with 21,799 last month
  • Pending Listings: 6,642 versus 6,092 last year - up 9.0% - but down 5.3% from 7,015 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 11,230 versus 10,455 last year - up 7.4% - but down 6.0% from 11,945 last month
  • Monthly Sales: 9,463 versus 9,234 last year - up 2.5% - but down 10.1% from 10,528 last month
  • Monthly Average Sales Price per Sq. Ft.: $172.30 versus $163.43 last year - up 5.4% - but up 0.2% from $172.01 last month
  • Monthly Median Sales Price: $279,000 versus $268,000 last year - up 4.1% - and up 0.4% from $278,000 last month

The most unusual change during June was the 8.5% drop in active listings (excluding UCB & CCBS), which lurched from 5.3% higher than 2018 on June 1 to 4.1% below 2018 on July 1. Much of this decline was due to the low number of listings activated during June - 8,731 is our current count, the second lowest number for June since 2001 and down 11% from June 2018. On top of a very busy month for contracts and closings this has caused the supply to tighten dramatically.

9,463 closed listings is a huge number for June. This is because June 2019 had only 20 working days, so the number of closings per day was over 473. June 2018 had 21 days so less than 440 closings per day. The difference is almost 8%.

Dollar volume for June was $3.315 billion. This is the highest total for any June in history.

The monthly median sales price of $279,000 is a new record high. The annual median sales price is also at a new record high at $268,000.

Average price per sq. ft. is nowhere near setting a new record, because the homes being sold today are much larger than those being sold at the last peak. The monthly average $/SF record is $190.05 set in May 2006. We edged up very slightly to $172.30 from $172.01 during June.

We now wait to see if July will continue the strong trends of May and June or start to ease off.

If you or anyone you know is looking to make a move, Please let me know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com 

Saving You Thousands!

Saving You Thousands!

(Previous Months Market Updates Below:)

June Market Update

May Market Update

April Market Update

March Market Update

February Market Update

January Market Update

Information provided courtesy The Cromford Report.
Posted in Market Updates
Dec. 7, 2019

June Market Update

June 2019 ~ Market Update

The month of May 2019 was a monster. New all-time records were set for sales units and dollar volumes through ARMLS, surpassing not only 2018 but the bubble year of 2005.

But let us start with the basics - the ARMLS numbers for June 1, 2019 compared with June 1, 2018 for all areas & types:

  • Active Listings (excluding UCB): 16,869 versus 16,018 last year - up 5.3% - but down 3.7% from 17,513 last month
  • Active Listings (including UCB): 21,799 versus 20,809 last year - up 4.8% - but down 7.8% compared with 23,650 last month
  • Pending Listings: 7,015 versus 6,608 last year - up 6.2% - but down 4.2% from 7,326 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 11,945 versus 11,399 last year - up 4.8% - but down 4.2% from 12,463 last month
  • Monthly Sales: 10,466 versus 10,104 last year - up 3.6% - and up 8.3% from 9,667 last month
  • Monthly Average Sales Price per Sq. Ft.: $172.11 versus $164.23 last year - up 4.8% - but down 0.01% from $172.20 last month
  • Monthly Median Sales Price: $278,000 versus $265,000 last year - up 4.9% - and up 3.0% from $270,000 last month

10,466 is the largest unit sales count we have ever measured for a calendar month. The previous record high was 10,345 which was set in June 2011 at the height of the REO feeding frenzy.

Dollar volume for May was $3.647 billion. The previous high was $3.354 billion which was set in May last year. The previous high was $3.245 billion set in June 2005 at the height of the real estate bubble.

These were not the only new records. The monthly median sales price of $278,000 is a new record high. The annual median sales price is also at a new record high at $265,900.

Average price per sq. ft. is nowhere near setting a new record, because the homes being sold today are much larger than those being sold at the last peak. The monthly average $/SF record is $190.05 set in May 2006.

May 2019 contained 22 working days, the same as May 2018 and April 2019, so no mental adjustments need to be made to these numbers to account for any difference in working days.

Supply is still higher than last year, but it is dropping faster than it did at this point a year ago. New listings are arriving at roughly the same rate as 2018 so the reason supply is falling is that homes are going under contract faster than last year.

May is usually the strongest month in each year, so we can expect monthly volumes to decline for the rest of 2019. We are also reaching the point where prices go a little soft for 3 or 4 months. This is mostly caused by the mix of homes sold because the high end is much weaker during the 100 degree weather. Wealthy people can afford to be somewhere other than Phoenix during the Summer.

It is unlikely that anyone would have predicted a May like this back in January. June looks pretty good too, but it has almost no chance of beating May. June 2019 starts and ends with a weekend and has only 20 working days, so we should expect a 9% fall in sales and dollar volume during June compared with May. It also starts with 4.2% fewer homes under contract. Set your expectations accordingly.

If you or anyone you know is looking to make a move, Please let me know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com 

Saving You Thousands!

Saving You Thousands!

(Previous Months Market Updates Below:)

May Market Update

April Market Update

March Market Update

February Market Update

January Market Update

Information provided courtesy The Cromford Report.
Posted in Market Updates
Dec. 7, 2019

May Market Update

May 2019 ~ Market Update

Starting with the basic ARMLS numbers for May 1, 2019 and comparing them with May 1, 2018 for all areas & types:

  • Active Listings (excluding UCB): 17,513 versus 16,329 last year - up 7.3% - but down 6.1% from 18,650 last month
  • Active Listings (including UCB): 23,650 versus 21,440 last year - up 5.6% - but down 3.2% compared with 23,399 last month
  • Pending Listings: 7,326 versus 7,393 last year - down 0.9% - but up 5.3% from 6,958 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 12,463 versus 12,504 last year - down 0.3% - but up 6.5% from 11,707 last month
  • Monthly Sales: 9,676 versus 9,185 last year - up 5.3% - and up 13.9% from 8,496 last month
  • Monthly Average Sales Price per Sq. Ft.: $171.80 versus $162.84 last year - up 5.5% - but down 0.1% from $172.04 last month
  • Monthly Median Sales Price: $270,000 versus $255,000 last year - up 5.9% - and up 1.5% from $266,000 last month

Last month we saw strong growth in listings under contract. This month we see strong growth in closed listings. This is why listings under contract is such an important number - it gives us early warnings of a change in the market. On this occasion the change is strongly positive for sellers. Sales are not only recovering, they actually exceeded April 2018 by 5.3%. Now those in the know are aware that April 2019 had a 4.8% advantage over April 2018, because it contained 1 additional working day. Many people tend to forget how significant the number of working days can be in retarding or advancing sales counts. But even allowing for that unfair advantage, April returned higher sales per day than April 2018. In fact April 2019 was the strongest month since 2005 for unit sales.

Currently the listings under contract count is almost the same as last year, so we should expect closed sales in May 2019 to be similar to May 2018. Both have 22 working days so this will be a fair fight.

New listings have been flowing a little more freely since March - we know sellers get encouraged by lower interest rates as well as buyers. However the new higher level of demand is making short work of the extra supply and active listings without a contract dropped over 6% during April. Supply is higher than last year, but it is falling more quickly than it did in 2018.

As we predicted, prices are rising, but at a slower pace than in 2018. The median sales price was up 5.9% compared with a year ago, while the average $/SF was up 5.5%.

Buyers waiting because they thought prices would fall have been left in the dust. The market continues to strengthen and the likelihood of falling prices in the near term is minimal. We have extremely low levels of distress, chronic low supply and the best buyers can hope for is that the appreciation rate will trend lower. We think that is a reasonable expectation, but it it shows no sign of turning negative. It would take a very different set of numbers from the ones above for that to be a possibility.

All in all, the market is more vibrant now than almost anyone expected it to be. This is good news for sellers, agents, title companies, lenders and developers. If interest rates start to rise again then we may see another mild slowdown, like we experience from September 2018 to February 2019, but at the moment the market engine is firing on all cylinders once more.

If you or anyone you know is looking to make a move, Please let me know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com 

Saving You Thousands!

Saving You Thousands!

(Previous Months Market Updates Below:)

April Market Update

March Market Update

February Market Update

January Market Update

 

Information provided by The Cromford Report

 

Posted in Market Updates
Dec. 7, 2019

April Market Update

April 2019 ~ Mkt Update

Starting with the basic ARMLS numbers for April 1, 2019 and comparing them with April 1, 2018 for all areas & types:

  • Active Listings (excluding UCB): 18,650 versus 16,972 last year - up 9.9% - but down 1.6% from 18,959 last month
  • Active Listings (including UCB): 23,399 versus 21,829 last year - up 7.2% - and up 0.9% compared with 23,197 last month
  • Pending Listings: 6,958 versus 7,128 last year - down 2.4% - but up 13.7% from 6,119 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 11,707 versus 11,985 last year - down 2.3% - but up 13.0% from 10,357 last month
  • Monthly Sales: 8,487 versus 9,645 last year - down 12.0% - but up 30.0% from 6,526 last month
  • Monthly Average Sales Price per Sq. Ft.: $171.87 versus $161.44 last year - up 6.5% - and up 1.9% from $168.62 last month
  • Monthly Median Sales Price: $266,000 versus $254,283 last year - up 4.6% - and up 0.8% from $264,000 last month

The housing market across Greater Phoenix improved significantly during March but has yet to catch up with 2018.

Supply without a contract is up almost 10% from a year ago. However it is down 1.6% from last month and new listings were lower in March 2019 than in March 2018 or 2017. Supply has been chronically low for many years and very little has changed in that department.

What we experienced starting in September 2018 was a minor but noticeable drop in demand. That declining trend is now being replaced by growth in demand. As usual we see this in pending listings and UCB listings before it shows up in closed listings. Under contract listings are only 2.3% lower than this time last year. At the start of March they were 11.5% lower. If this improvement keeps up then under contract listing counts could even overtake 2018 during April. We will have to wait and see.

Closings run well behind contracts and have not caught up with 2018 rates yet, but they are improving, March was up 30% from February. We should also mention that March 2019 had 1 fewer working days than March 2018 so 5% of the 12% gap can explained by that fact alone, leaving a 7% deficit. In February there was an 8% deficit. Because of the surge in contract activity we expect the gap to close further in April.

With demand comfortably exceeding supply, prices continue to rise, though not as quickly as they did this time last year.

Almost all the gloomy statements you may have seen about the Phoenix housing market outside the Cromford Report have proven to to be wildly overblown. It is in good shape and, thanks to lower interest rates and higher loan limits, we are seeing demand headed back to normal.

If you or anyone you know is looking to make a move, Please let me know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com 

Saving You Thousands!

Saving You Thousands!

(Previous Months Market Updates Below:)

March Market Update

February Market Update

January Market Update

 

Information provided by The Cromford Report

 

Posted in Market Updates
Dec. 7, 2019

March Market Update

March 2019 ~ Market Update

Starting with the basic ARMLS numbers for March 1, 2019 and comparing them with March 1, 2018 for all areas & types:

  • Active Listings (excluding UCB): 18,959 versus 16,924 last year - up 12.0% - but down 0.4% from 19,040 last month
  • Active Listings (including UCB): 23,197 versus 21,474 last year - up 8.0% - and up 2.4% compared with 22,655 last month
  • Pending Listings: 6,119 versus 7,158 last year - down 14.5% - but up 22.1% from 5,012 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 10,357 versus 11,708 last year - down 11.5% - but up 20.1% from 8,627 last month
  • Monthly Sales: 6,480 versus 7,067 last year - down 8.3% - but up 18.6% from 5,462 last month
  • Monthly Average Sales Price per Sq. Ft.: $168.57 versus $158.83 last year - up 6.1% - and up 0.6% from $167.59 last month
  • Monthly Median Sales Price: $264,000 versus $252,000 last year - up 4.8% - and up 0.8% from $262,000 last month

The second half of February saw momentum building in the market, though it will need to build even more to catch up with last year when it was running on all cylinders.

Supply without a contract is up 8% from a year ago. However it has already declined between February 1 and March 1, something which usually only occurs in years when the market is doing rather well. That is just one of several good omens that suggest the weakness in demand that started in September is now dissipating.

Another positive sign is that sales increased by over 18% between January and February. This compares favorably with last year which gave us a 14.4% increase. The annual sales rate continues to fall, but the momentum of this trend is fading just a little.

Under contract listings grew over 20% since last month, Again this is better than in 2018 when the increase was 16.6%.

It is early days in the improving cycle so we should not get carried away with enthusiasm. Demand could fade again if we get a significant increase in loan interest rates. However, if this is signalled ahead of time, it could encourage buyers to make their minds up before the rates go into effect.

Anyone who is expecting prices to fall is likely to be very disappointed by the current state of affairs. Yes, asking prices are being cut at quite a high rate, but asking prices are often overly optimistic anyway, especially for homes that have just been listed. Actual closed prices are looking very strong, as we can see in the numbers above. The mix is changing in favor of higher end homes too, since the low end below $200,000 remains chronically under-supplied. The usual upward cycle in average price per sq. ft. during the spring looks like it has turned up as usual in 2019.

The market looked uncertain at the end of January, but now we are seeing an upward trend in the Cromford® Demand Index and any day now we should see a mild declining trend in the Cromford® Supply Index. Both of these are good news for sellers and not-so-good for buyers.

If you or anyone you know is looking to make a move, Please let me know!

Buying | Selling | Investing

480-773-5792

www.Sell4Free-AZ.com 

Saving You Thousands!

Saving You Thousands!

(Previous Months Market Updates Below:)

February Market Update

January Market Update

 

Information provided by The Cromford Report

 

Posted in Market Updates
Dec. 7, 2019

February Market Update

February 2020, Market Summary!

The current situation is even more remarkable than last month.

Last month I wrote that buyers must hope for a big surge in new listings. Not only did they not get anything close to a big surge, or even a tiny up-tick, they unexpectedly got far fewer new listings than normal. The lack of supply was described as shocking at the start of 2020, so I am starting to run out of adjectives to adequately describe the current state of supply. It is almost (but not quite) unheard of to see supply drop between January 1 and February 1, but active listings without a contract are down 1.4% for the month. They are down a colossal 35% compared to a year ago.

Meanwhile demand has been picking up so that monthly sales are up 17% compared with last year while listings under contract are up 16%. Given that there are so few homes to buy, this is impressive.

Economics 101 teaches us that lower supply and higher demand is a recipe for higher prices. So far the reaction of pricing has been muted. However, you should not expect it to stay that way. The spring selling season has just started and by the time we get to June a significant upward adjustment in pricing is likely.

Mortgages are becoming easier to qualify for in many different ways, so demand is likely to increase. Yet there is no sign of more supply coming along to satisfy it. In this situation the market is likely to become both frenzied and frustrating. We certainly live in interesting times.

Here are the basics - the ARMLS numbers for February 1, 2020 compared with February 1, 2019 for all areas & types:

  • Active Listings (excluding UCB & CCBS): 11,974 versus 19,040 last year - down 35.1% - and down 1.4% from 12,141 last month
  • Active Listings (including UCB & CCBS): 16,015 versus 22,655 last year - down 29.2% - but up 6.8% compared with 15,018 last month
  • Pending Listings: 5,969 versus 5,012 last year - up 19.1% - and up 28.0% from 4,662 last month
  • Under Contract Listings (including Pending, CCBS & UCB): 10,030 versus 8,627 last year - up 16.3% - and up 33.0% from 7,539 last month
  • Monthly Sales: 6,403 versus 5,467 last year - up 17.1% - but down 17.8% from 7,789 last month
  • Monthly Average Sales Price per Sq. Ft.: $182.20 versus $167.79 last year - up 8.6% - and up 1.3% from $179.85 last month
  • Monthly Median Sales Price: $289,900 versus $262,000 last year - up 10.6% - and up 0.1% from $289,500 last month

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Information provided courtesy The Cromford Report.

 

Posted in Market Updates