Much of the news today talks about how hot the real estate market is. And generally speaking, it is a seller’s market. But, if you look at the details in the Phoenix area, the lower price ranges are selling quickly, while the higher price ranges that you see in Scottsdale and other parts of the valley are moving more slowing, which is really pretty typical.
Here are 2 charts to show you how many homes sold in each price range last month, as well as how many months of inventory are currently listed for sale, as of the first of May.
A buyers market is consider to be one where there is less than 5 months of inventory and a seller’s market is one where there is more than 7 months of inventory. The sweet spot, a balanced market, is between 5-7 months
So when you hear about homes sold in one day or one week, with multiple offers, there’s a good chance that they were listed at $300,000 or less.
Just listed for sale in Arrowhead Lakes Golf Course Home for Sale.
Phoenix Residential Real Estate Contracts up 12%
Monthly Median Sales Price up 7.1%
The Phoenix Residential Real Estate market has been this summer in comparison to the busy Spring season. However, there is a bright side for sellers. While contracts in escrow have seasonally declined 17% since their peak last May, at 11,190 this measure is nearly 12% higher than last year’s count. Another bright side for sellers is, despite the seasonal slowdown of new contracts in escrow, listings under $400,000 are still getting within 98-99% of their asking price after negotiations. Nearly 28% of July closings through the MLS included some level of seller-assisted closing costs. That percentage is highest for listings between $200,000 and $250,000 at nearly 35%, and lowest for listings over $500,000 at under 5%. Be prepared for weekly price reductions to increase next month as more new listings begin to enter the market.
If you’ve been frustrated over the past 5 months with high buyer demand for well-priced properties within your price range, you should be seeing some relief now. August is typically a slow time for buyer activity across all price ranges and 2016 is no different. Contracts in escrow began their decline in June, dropping nearly 17% from a high of 13,432 in May to 11,190 by the first week of August. Active listings have also declined nearly 10%, down to 19,783 since their peak in March at 21,924. At this time of year, many sellers are tired of being on the market, making it a good time to revisit those listings that were not picked up during the peak or came on the market late in the season. August is a very slow month for new listings to come on the market, therefore expect inventory to be relatively stale until more new listings start coming on stronger towards late September and October.
Scottsdale housing prices remain steady and strong. According to the Cromford report, the average price per square foot for housing is $231/sf, just $2/sf over last year. And while this may not be the impetus to buy or sell. in and of itself, it’s an indicator.
Scottsdale Ranks #3 in Housing Affordability
Looking more closely at the cities that have experienced double digit (by %) growth in the past year, you will see that once again, we are in a market where many of the outlying areas are experiencing the greatest growth, and the greatest decline, with the exception of pricey Paradise Valley.
Scottsdale, remains a relatively central location, with easy access to both the Scottsdale and downtown Phoenix job centers. And with stable home prices, remains a smart buy in today’s real estate market.