Your look at what’s happening in residential real estate throughout Greater Phoenix and the Northeast Valley cities of Scottsdale, Phoenix, and Cave Creek. This month, prices continue to rise, sellers control the market under $500,000, and see which zip codes have reached their lowest inventory level in the last several years.
Market Summary | Greater Phoenix | July 2018
Here are the ARMLS numbers as of July 1st, 2018 compared to July 1st, 2017 for Greater Phoenix (all areas and property types).
Active Listings: 16,101 versus 18,087 last year – down 11%
Monthly Sales: 9,171 vs 9,608 last year – down 4.5%
Monthly Avg. Sales Price/Square Foot: $163.59 versus $151.67 last year – up 7.9%
Monthly Median Sales Price: $267,329 versus $245,000 last year – up 9.1%
Market Commentary by Michael Orr with The Cromford Report
Greater Phoenix is officially in the seasonal summer slowdown and contracts in escrow are expected to continue declining overall until the end of the year. The peak of the market for contract activity usually hits at the end of April, as it did both this year and last year. So far levels have dropped 17% from the peak, which is closely following last year’s drop of 18% between April and July.
If the 2018 market follows last year and previous years, we can expect contracts in escrow to drop about 4% per month until the end of the year. This would be considered perfectly normal, anything more could indicate a non-seasonal drop in demand.
The sales count for June looks weak, down significantly from May and the first month to show a year-on-year decline for 2 years. Before we start to wring our hands, we need to check how many working days there were in June 2017 and 2018. There were 22 in 2017 and 21 in 2018, giving June 2018 a 4.5% disadvantage.
This is exactly the same percentage as the shortfall in sales compared with June 2017. We conclude that the underlying sales rate is very similar to last year. This is nothing to be too concerned about but it is evidence that the sales rate peaked in May and may no longer be rising.
To confirm this we look at the annual sales rate which stands at 96,965. A month ago, we saw 97,402, so we are seeing confirming evidence that sales are no longer growing. However there is also little sign of a significant decline in sales so far, as the huge declines at the bottom are sufficiently balance by increases in the mid-range and top end.
LISTINGS UNDER CONTRACT
The number of listings under contract at the beginning of July is lower than last year – down 3% – but this is nothing new, as it was down 6% last month. In conjunction with the lower monthly sales count and the weaker annual sales rate, this confirms that demand is getting slightly weaker. A combination of poor supply, higher pricing and rising interest rates makes this unsurprising. Demand is strong at the upper end but unit volumes are too small above $500,000 to have much impact on the overall market direction.
Just as median sales prices dropped unusually low during the housing crash, they are now rising artificially quickly. This is predominantly caused by the lack of supply of homes at the low end, not by the increase in home prices.
We caution you not to use the median sales price as a guide to how fast the market is appreciating. The average price per sq. ft. is a much better measuring tool at times like these.
Shared with permission of The Cromford Report
City Snapshots | July 2018
Here’s a closer look at the numbers for the residential resale market as of July 5th, 2018 compared to July 5th, 2017 in the following cities (single family homes only).
Active Listings: 1,937 versus 2,149 last year – down 9.9%
Monthly Sales: 540 vs 494 last year – up 9.3%
Annual Avg. Sales Price/Square Foot: $249.61 versus $239.27 last year – up 4.3%
Annual Median Sales Price: $549,000 versus $511,000 last year – up 7.4%
Days on Market (monthly sales): 103 versus 116 last year – down 11.2%
Active Listings: 3,558 versus 3,771 last year – down 5.7%
Monthly Sales: 1,599 vs 1,667 last year – down 4.1%
Annual Avg. Sales Price/Square Foot: $163.08 versus $152.39 last year – up 7.0%
Annual Median Sales Price: $255,000 versus $235,000 last year – up 8.5%
Days on Market (monthly sales): 55 versus 59 last year – down 6.8%
Active Listings: 277 versus 276 last year – up 0.4%
Monthly Sales: 75 versus 85 last year – down 11.8%
Annual Avg. Sales Price/Square Foot: $196.33 versus $185.20 last year – up 6.0%
Annual Median Sales Price: $450,000 versus $439,450 – up 2.4%
Days on Market (monthly sales): 110 versus 123 last year – down 11.0%
Active Listings: 198 versus 251 last year – down 21.1%
Monthly Sales: 57 vs 43 last year – up 32.6%
Annual Avg. Sales Price/Square Foot: $211.63 versus $198.25 last year – up 6.8%
Annual Median Sales Price: $469,450 versus $439,950 last year – up 6.7%
Days on Market (monthly sales): 142 versus 146 last year – down 2.7%
Active Listings: 296 versus 325 last year – down 8.9%
Monthly Sales: 37 versus 32 last year – up 15.6%
Annual Avg. Sales Price/Square Foot: $373.68 versus $352.03 last year – up 6.2%
Annual Sales Price: $1,710,000 versus $1,400,000 – up 22.1%
Days on Market (monthly sales): 208 versus 197 last year – up 5.6%
Active Listings: 738 versus 848 last year – down 13.0%
Monthly Sales: 422 versus 408 last year – up 3.4%
Annual Avg. Sales Price/Square Foot: $160.04 versus $150.86 last year – up 6.1%
Annual Median Sales Price: $319,250 versus $294,750 – up 8.3%
Days on Market (monthly sales): 45 versus 48 last year – down 6.3%
Active Listings: 779 versus 981 last year – down 20.6%
Monthly Sales: 545 versus 504 last year – up 8.1%
Annual Avg. Sales Price/Square Foot: $150.86 versus $140.96 last year – up 7.0%
Annual Median Sales Price: $318,000 versus $292,000 – up 8.9%
Days on Market (monthly sales): 47 versus 56 last year – down 16.1%
Active Listings: 240 versus 347 last year – down 31.0%
Monthly Sales: 139 vs 158 last year – down 12.0%
Annual Avg. Sales Price/Square Foot: $169.52 versus $159.95 last year – up 6.0%
Annual Median Sales Price: $299,000 versus $280,000 last year – up 6.8%
Days on Market (monthly sales): 44 versus 64 last year – down 31.3%
Active Listings: 1,114 versus 1,260 last year – down 11.6%
Monthly Sales: 672 versus 677 last year – down 0.7%
Annual Avg. Sales Price/Square Foot: $146.54 versus $135.86 last year – up 7.9%
Annual Sales Price: $259,000 versus $239,500 – up 8.1%
Days on Market (monthly sales): 47 versus 60 last year – down 21.7%
Active Listings: 691 versus 653 last year – up 5.8%
Monthly Sales: 375 versus 387 last year – down 3.1%
Annual Avg. Sales Price Per Square Foot: $137.15 versus $127.45 last year – up 7.6%
Annual Sales Price: $239,000 versus $223,500 – up 6.9%
Days on Market (monthly sales): 46 versus 50 last year – down 8.0%
For more information about market conditions in your area, contact us today.
Data and commentary shared with permission by The Cromford Report®
Single Family Listing Counts
“July 2 – At this half-way point in the year, it is tempting to assume that not much has changed since January. The overall Cromford® Market Index is bouncing around within a narrow range between 150 and 170 and everything looks pretty stable.
However when we look at individual ZIP codes, we see some that are reaching new lows in single-family active listing counts while others are moving much higher. Here are some of the zip codes that jumped out at us.
Supply Moving Higher:
- Phoenix 85006 – 74 active listings – the highest count since 2011
- Phoenix 85008 – 68 active listings – the highest in over 2 years
- Phoenix 85013 – 63 active listings – the highest in 15 months
- Phoenix 85015 – 79 active listings – the highest in over 4 years
- Phoenix 85023 – 74 active listings – the highest in 14 months
- Phoenix 85053 – 52 active listings – the highest in 19 months
- Phoenix 85083 – 115 active listings – the highest in over 4 years
- Phoenix / Anthem 85086 – 291 active listings – the highest in 14 months
The low inventory plaguing most of the valley does not apply in the above areas, so buyers may do well by shopping there.
Supply Reaching New Lows:
- Paradise Valley 85253 – 267 active listings – the lowest level in almost 3 years
- Scottsdale 85255 – 424 active listings – the lowest level in almost 3 years
- Scottsdale 85257 – 46 active listings – the lowest level in 3 years
- Scottsdale 85258 – 82 active listings – the lowest level we have ever recorded for the start of a month
- Scottsdale 85262 – 360 active listings – the lowest level in almost 3 years
- Rio Verde 85263 – 43 active listings – the lowest level in almost 3 years
- Fountain Hills 85268 – 161 active listings – the lowest level in almost 5 years
- Phoenix 85045 – 26 active listings – second lowest level since 2013
- Mesa 85206 – 46 active listings – the lowest number we have ever recorded for the start of a month
- Gilbert 85298 – 137 active listings – the lowest level in over 5 years
- Surprise 85374 – 110 active listings – the lowest level in almost 3 years
- Carefree 85377 – 53 active listings – the lowest level in almost 5 years
- Surprise 85378 – 15 active listings – the lowest level in 14 months
It is counter-intuitive that the ZIP codes showing growth in supply should be all in the central and north valley. However it is true. Phoenix is better supplied than most of the other large cities.
Many of the ZIP codes hitting low points are in southern Pinal County and the Northeast Valley.
The 4 most expensive ZIP codes (85253, 85255, 85262 and 85377) are all in the list of ZIP codes making new lows in supply. It would appear that wealthy people are spending some of their tax cuts on luxury homes. The strong increase in luxury sales in 2018 has made inroads into what used to to be an excess of supply.
Commentary shared with permission of the Cromford Report®
City Rankings – Annual Average Price Per Square Foot
This table ranks the cities by their annual average sales price per square foot. Only single family detached homes are included in these numbers. Information for the 12 major and 17 secondary cities is current as of the date shown. Data for the 14 small cities is updated on a monthly basis, and is measured on the 13th of each month.
The primary function of this table is to show the least and most affordable areas in the Phoenix metropolitan area together with longer term pricing trends.
Commentary shared with permission of the Cromford Report®
With over 25 years of experience representing buyers and sellers throughout Phoenix, we have the knowledge and expertise to you need in an agent. If you have questions or would like more information on the market conditions in your area and how they may impact your goals to buy or sell, contact us at Info@CarmelleAZHomes.com or call/ text us at 480-648-9253.
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