You all know that major changes have occurred in the Phoenix real estate market over the past year, but I think these two charts illustrating the Months Supply by Price Range may take you a bit by surprise. I know I did a double-take, and needed to take a closer look before sharing them with you.
A year ago, the lower end of the market was moving quite briskly, and there was less than six months inventory for homes priced under $200,000. For homes priced over $600K, there was more than a two year supply, and that supply increased dramatically as the price range increased.
Now, see what is going on today.
Looking at months supply of homes, you will notice that now there is less than a six month’s supply of home in all price ranges under $350K. And the 2+ year supply of homes doesn’t come into play until you get into the super-luxury market of over $3M. While there is still definitely a surplus of inventory in the $600K-$2M range, it is no where near what we were experiencing last year and dramatically reduced from a year ago.
For instance, in 2009 there was a 49 month supply of homes in the $1-1.5M range. Today, that supply is 13.6 months! This decrease in supply is most noticeable in the upper price ranges, from $500K and up. And in Scottsdale, where the current average home price is about $525K, this reduction in inventory in the higher price ranges is more than good news.
In my mind, it only gets better from here. What do you think?
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