Examining the latest market indicators closely, there are notable trends suggesting stability and positive prospects for the Greater Phoenix area, according to the latest data released by Phoenix REALTORS, the Valley’s preeminent real estate membership organization and most reputable source for real estate news today, with many resources that include a clearinghouse of up-to-date research, statistics and data offering insights on marketplace trends.
“Changes in interest rates, questions about the market and the difficulty of finding replacement homes are clouding the residential market,” says Butch Leiber, president of the Phoenix REALTORS’ board of directors and an active broker. “The major takeaway from the data is that the numbers don’t look as good as last year, but we’re holding steady in some of the key indicators like price and turnover, which is terrific news for the long term.”
Leiber explained that the “Unicorn Years” phenomenon of 2020–2022 is not reflective of the reality in the Valley. “The Unicorn years were unbridled boom years. But when we look at 2017–2019 — a period of relatively normal and expected growth — the market is tracking exactly where it should be,” he says.
“Sales prices are holding steady compared to April and May, with a median increase from $449,000 in May to $455,000 in June, but the real story is in seeing how our numbers fare historically,” Leiber says. “While the reality of year-over-year numbers may be stark when considering pending sales are down nearly 32% and new listings are down by 47.8%, the truth is that the Greater Phoenix area is doing quite well.”
Additionally, even looking at numbers from last year, there are growing signs of market stability:
- List price: The percentage of list price received for sales is the highest since March (98.6%, down just 1.9% from last year). In year-to-date comparison, 98.1% is the highest since March, but that’s 3.3% less than last year’s 101.5%.
- Inventory/Days on Market: The 2.3-month supply of inventory is steady but trending downward. The lack of inventory can be attributed to sellers holding back listing their homes until interest rates improve, limited new construction and an influx of new residents to Arizona.
The market entered July with 13,072 homes in the inventory, which sits in the middle of the past four months, that ranged between a high of 13,676 in May and a low of 12,563 in April.
- New listings: While the June numbers — at 6,591 — were flat compared to May’s 6,953, they were higher than both March and April.
Some additional data revealed that pending sales dropped 12.1% from May but were down around 3% from March and April. At the same time, closed sales were down 9% from May and higher than in March or April.
“It’s hard to look ahead with the way the market data has been reporting, especially looking at year-over-year numbers,” Leiber says. “The statistics keep showing that, overall, the market is doing well since this winter. But comparing data to last year — an anomaly period — doesn’t give an accurate picture of how the market is performing this year.”
Leiber believes the numbers are showing that the Greater Phoenix area is in a healthy growth phase or a “new normal” after a period of untamed growth.