Maricopa County September Market Update by Troy Peterson

THE MARKET FACTORS

BOTTOM LINE: we remain in a hyper seller’s market with little indication that a major change is imminent. So it’s likely to remain a challenge for buyers in most price points, but better than it was 6 months ago. Sellers are still mostly in control, just not without some need for reasonability.

• SALES PRICES DECLINE!: This again is news! This is the 2nd month in a row where the average sales price has dropped. This can be somewhat misleading however, because if you look deeper at the numbers, it’s not that prices are actually dropping, but rather that in the recent couple months there are more lower priced homes selling in comparison. This is mostly due to the fact that the luxury market slows in the summer and therefore those higher priced homes are not selling and elevating overall sales prices. The year over year increase is still 23%!
  
• INCREASED INVENTORY: We continue with this positive trend, and available properties have been slowly increasing since late February. That said, we are still well below last year and a normal “healthy” level of supply.
  
• SELLERS MARKET: The entire Valley remains a SELLER MARKET. As of today, the Cromford Market Index (CMI) is at 348 and has been mostly flat for 5 weeks. That said, we are still in a hyper seller’s market, so we will no doubt continue to see rising prices (year over year). A balanced market of supply vrs demand is a CMI of 100. Interestingly, FOUNTAIN HILLS is the hottest market right now!! Go figure.
  
• CLOSINGS OVER LIST PRICE: This has been slowly declining for the last 3 months which peaked in June at 60%. However, in September we are still seeing 51% of all homes being sold at OVER list price! Remarkable.
  
• ANNUAL APPRECIATION: This trend continues to see a cooling off. Though it’s still staggering, it has “dropped” now to 28%, measured using a monthly average price/sf.
  
• NORMAL TRANSACTION VOLUME: For the month of August, the amount of sales was fairly typical to overall averages of previous years. Amidst the challenges of the market, it’s still possible to put deals together!
  
• NEW CONTRACTS:  This calendar year the amounts of new contracts has been mostly flat from week to week and not really influenced by normal seasonality.
  
• iBUYERS: One of the most interesting trends of late is the buying spree of the iBuyers and large institutional investors. The iBuyers as a group purchased 1,145 homes in August, the largest number ever in one month. They hold approximately 10% of the available listings on ARMLS currently. This is definitely something to keep an eye on!