Market Summary for the Beginning of March 2024

Hello,

Market Summary for the Beginning of March

Here are the basics – the ARMLS numbers for March 1, 2024 compared with March 1, 2023 for all areas & types:

• Active Listings: 16,568 versus 14,739 last year – up 12% – and up 6.4% from 15,574 last month
• Under Contract Listings: 8,693 versus 9,109 last year – down 4.6% – but up 17% from 7,423 last month
• Monthly Sales: 5,720 versus 5,706 last year – up 0.2% – and up 29% from 4,435 last month
• Monthly Average Sales Price per Sq. Ft.: $293.70 versus $271.11 last year – up 8.3% – and up 1.7% from $288.74 last month
• Monthly Median Sales Price: $440,000 versus $413,000 last year – up 6.5% – and up 2.3% from $430,000 last month

This set of numbers is a little disappointing, but by no means disastrous. On the bright side, closed listing counts for February 2024 managed to exceed February 2023, but only by 0.2%. This is not the recovery in volume that so many are impatiently hoping for. Also brighter, sales pricing performed better than anticipated and was up 1.7% from last month based on the monthly average sales price per square foot. The monthly median sale price rose by $10,000 too. However, the rate at which contracts are getting signatures is lower than we expected and much lower than normal. We are starting March with only 8,693 listings under contract, down 4.6% from this time last year. And last year was well below normal.

The slow contract signing rate means active listing counts have continued to grow steadily, up by 2,000 since the start of the year. Last year we saw a fall of over 1,500 over the same period, because new supply was much scarcer then. It was the decline in supply that allowed us to scoff a year ago when Goldman Sachs published their ludicrous forecast that Arizona home prices would fall to 2008 levels in 2023. That certainly proved they had no idea what they were talking about. Prices are now up 8.3% from this time last year. But I suppose we should not be surprised – Goldman Sachs also had a “conviction buy” rating on Wirecard in 2019, the same company that declared insolvency 9 months later when their auditors finally spotted that over $2 billion in Wirecard’s cash account did not actually exist. But I digress.

There is still no sign of a market crash in the short or medium term, but the market is struggling to gain traction. The healthy amount of incoming supply is not quite matched by a small improvement in demand and the balance between sellers and buyers only favors sellers by a small amount when considering the market as a whole. In many sectors of the market, buyers have more negotiating room, even though, judging by the recent price movements, most of them do not seem to realize this.

At the top end of the market we have a lot of supply.

• Over $10 million, there are 76 active listings – this is 2.6 years of supply at the current closing rate of 29 per year.
• Between $5 million and $10 million, there are 221 active listings – this is 16 months of supply at the current closing rate of 164 per year.
• Between $3 million and $5 million, there are 319 active listings – this is 8 months of supply at the current closing rate of 455 per year.

In certain outlying areas, we also have plenty of active listings. Examples include Casa Grande, Maricopa and Buckeye. But many cities that are closer to Phoenix and are dominated by homes under $1 million still have a tight supply and buyers outnumber sellers in most of these areas.

Market conditions are currently quite stable, so the idea that some sort of collapse is imminent is extremely far-fetched. However conditions can and often do change with little notice, so it is always worth keeping a close eye on the key numbers. At least once a week would be our suggestion.

Go to my website for up-to-date information and a special feature called “Neighborhood News” “the best way to stay connected to what’s happening in the real estate market in your area”.  See homes that are for sale and recently sold, find out if home sales in your neighborhood are trending up or down, see what homes around you are currently selling for.  Also, you can search real time listings in any area of the market under (Find Your Dream Home.)  Check it out and stay updated with my daily blog and monthly market report that I send out monthly.  My Website–Find Your Dream Home

If you’re considering selling or buying, give me a call to discuss your situation and current market conditions.

The best compliment is a referral to your family and friends!