The media talks about the hot Phoenix real estate market, yet most home sellers I meet are still operating from a perspective that no one is buying homes these day, because the market is so bad!
However, any home buyer will tell you, it’s a battle out there. Multiple offers are common in the lower price ranges, and with the deadline of the $8,000 tax credit coming up quickly, last-minute shoppers are finding that a full-price offer is often not enough.
You see in the chart above that overall Phoenix has been experiencing a seller’s market since May of this year. You can also see that the steep incline has been tapering off over the last couple of months.
When you look at the next chart showing Months Supply by Price Range, you will see that this year’s trend continues: The lower the price of the home, the lower the housing inventory.
We are seeing just a bit of change though. The Seller’s Market that we were experiencing this summer is cooling off in the $250-350K range.
- Homes priced up to $250K have less than five month’s supply. Seller’s have the upper hand here. Multiple offers are common.
- Between $250,000 and $400,000, we are seeing a balanced market.
- Over $400K, Buyer still have a lot of negotiating power, depending on how the Seller has priced the home.
If you’d like to go back and see where the market was earlier this year, these two posts will help:
Buyers Market? Sellers Market? Depends. – August 2009 view
Why is Scottsdale real estate market behind the curve? – June 2009 view
With the tax credit possibly coming to an end, the slight changes you are seeing here could continue, even more significantly. I think most would agree that any movement towards a more balanced market would be a welcome reprieve after the roller coaster ride of the past several years.
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yep, yep and yep…you nailed it Dru. When people ask me if it’s a buyer or seller’s market I ask them what price range they are interested in, because we really do essentially have 3 separate markets, and likewise 3 different marketing and/or buying strategies we need to be operating in. Great concise post! Thanks.
Great article. I especially liked the graphic of Months of Inventory by list price with the hand written notations of Buyer, Balanced and Sellers Market.
It would also be nice to take into account how long it’s taking for a lot of these homes to actually close escrow. Does that change with the price of the home too?
Luckily we don’t have the market you do in Phoenix right now.
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Thank you, Tiffany and Steve.
Paul – Yes, I do know of situations where short sales have taken so long to negotiate that the appraisal is no longer valid in a depreciating market. Short sales seem to be closing a bit more quickly (as we gain experience and they become more prevalent), and prices in the more active and lower end of the market have begun to stabilize. You are lucky to be a more stable market.
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