Courtesy of Barb Savoy-Pacella, CEO ~ Keller Williams Arizona Realty
Periodically, I have compared months of supply of inventory for different municipalities in the metro area. This week, I would like to focus on months of supply by price range throughout the Phoenix metro area.
Typically a 5.5 months supply of inventory is considered a "'balanced market." In other words, inventory below 5.5 months of supply would be considered a seller's market because demand would be heavier than supply; and inventory above 5.5 months of supply would considered a buyer's market because supply would be heavier than demand.
As I mentioned in May, there were only three Valley cities that had more than a 5.5 month supply, and those were the cities with a larger demographic of luxury homes, and least effected by distress; Scottsdale, Paradise Valley, and Fountain Hills. Reviewing months of supply by price range might be surprising:
|
Price Range |
Months of Supply |
|
$0 - $99,999 |
2.4 |
|
$100,000 - $199,999 |
2.9 |
|
$200,000 - $299,999 |
3.9 |
|
$300,000 - $399,999 |
4.2 |
|
$400,000 - $499,999 |
5.7 |
|
$500,000 - $599,999 |
5.4 |
|
$600,000 - $699,999 |
6.7 |
|
$700,000 - $799,999 |
7.0 |
|
$800,000 - $899,999 |
8.9 |
|
$900,000 - $999,999 |
10.4 |
|
$1,000,000 + |
14.4 |
The market becomes balanced in the $400,000 to $600,000 range and a buyer's market isn't established until the $600,000 threshold is crossed. Even so, the percentage of sales price to list price is above 90% in every price range except $1,000,000 +, which is still at 88.3%. Additionally Valley wide absorption (the percentage of homes selling, versus the amount of active inventory on the market) is at 32%, which is the highest that I can recall in five years.
We are celebrating an offer that was accepted yesterday. Why such cause for celebration? Because it was competing with 17 other offers. Another listing priced at $400,000 that sold in seven days with three offers. This is important information for buyers to understand as they enter the marketplace.
Listings Pending Sale are still strong with a total of 13,719. That is a decrease of 116 pending listings compared to last week. Listings that are active with contingencies account for an additional 7997 properties.
Current Conditions in the Phoenix Market:
- There are 17,925 single family detached listings, currently active in MLS. That is a decrease of 561 listings from last week, and the twentieth consecutive week of decrease.
- There are 22,496 total listings currently active in MLS, which includes condos, patio homes, townhomes, and lofts.
For additional information, or to view homes for sale, visit www.PacellaGroup.com
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