Maricopa County March Market Update

by Troy Peterson

BOTTOM LINE: The ever so slight slow-down I mentioned last month appears to be in certain sub-markets more than the overall Valley. I believe that the low inventory is the greatest contributor as there just aren’t enough homes to sell. Our market however remains extremely hot, and it HEAVILY favors the sellers. The competition is fierce (and often frustrating) for buyers. I feel for the first-time homebuyer. We should expect a continuation of quickly rising prices and high appreciation percentages.

POINTS OF INTEREST

SALES PRICES: To give a little perspective, there has been a 67% increase over the last 2 years. The average sales price in March, 2020 was $373,700.

CLOSINGS OVER LIST PRICE: Pay attention! This has rapidly changed in the last few months and currently 55% of all homes being sold are OVER list price! Even the Scottsdale market is seeing 57% of homes selling for over list price. The price point with the highest percentage (64%) of sales over list price continues to be $300-400k.

ANNUAL APPRECIATION: Even with a slight cool down, we are still seeing a 22% appreciation rate based on average price/sf. NOTE: There has been an appreciation rate of over 15% for 19 straight months!

SLIGHTLY LOWER TRANSACTION VOLUME: There is definitely a trend that 2022 volume is below 2021 levels, however it’s still VERY strong and ahead of nearly all previous years.

SELLERS MARKET: The entire Valley remains a SELLER MARKET. The Cromford Market Index (CMI) has appeared to crest in February and now decreasing slightly to a current of 453. The index has not reached the highest point of ’21, but probably unperceptively close. With an index this high it’s extremely in favor of sellers, and buyers will have a difficult time winning without very aggressive offers. A balanced market of supply vrs demand is a CMI of 100.

INVENTORY SHORTAGE: Nothing new here. There just aren’t enough houses coming on the market to meet the demand.

NEW CONTRACTS: Though we are seeing a strong amount of new contracts across the Valley, if you look at some of the cities, such as Scottsdale, we are down 21% in new contracts. Depending upon your primary market, you might be feeling this slow down. As I talk with you, my hunch is that it’s completely due to low inventory, NOT that there aren’t buyers looking in these markets.

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