Phoenix Arizona Real Estate Market Update

Real Estate Agent with Coldwell Banker

Phoenix Arizona Real Estate Market Update

Mike Orr, author, statistician, real estate market forecaster and numbers nerd in general has kept pace with the real estate market and gave his research relating to Phoenix Arizons Real Estate Market Update at a recent seminar.  His report, the Cromford Reportis the go to source for real estate market pricing, trends and forecasting.

I had the privilege of attending a seminar with  Mike Orr as one of the speakers.  His information is informative, accurate and concise...but he is quick to point out that while he cannot predict the future, the future will reveal either the fallacy of his predictions or confirm them....For the most part, Mike Orr's predictions are generall spot-on.

The information reported below is my recant of what he reported.  The pictures are slides used in his Power Point presentation and let me make it perfectly clear, this is his information and research with my supporting narrative quoting what he said as well as my own speculation...So, here we go!

scottsdale home listings,carefree home listings,cave creek home listings,rio verde home listings,phoenix home listings


The Phoenix Real Estate Market has undergone significant changes in a short period of time.  In 2010, the Phoenix Real Estate market was dominated by foreclosures, inventory, lender owned real estate and falling real estate prices.  Since 2010, we have seen Phoenix Real Estate prices rise, Phoenix Real Estate absorbed and general relative stability in the real estate market.

The Phoenix Arizona Real Estate Market is filled with multitudes of emotions about Arizona Real Estate Investment.  These emotions are cyclical and will apply to all real estate markets in the United States.  The emotional cycle runs something like this...

scottsdale arizona real estate market cycle,cave creek arizona real estate market cycle,rio verde arizona real estate home market cycle,carefree arizona real estate home market cycle
Market Cycles

The Cromford Report has followed the ups and downs of the Phoenix Real Estate Market over a 13 year period.  Below is the monthly average home sales price per square foot since 1999.  Using 1999 as the base year we see that the median price per square foot of homes in the Phoenix real estate market went from  $99 per square foot to a high of $190 per square foot in 2006 to a low of $79 per square foot in 2011 with present median sales price per square foot of $127.

Scottsdale Arizona Home Prices, Cave Creek Arizona Home Prices,Carefree Arizona Home Prices
Phoenix Arizona Home Prices adjusted to CPI

Applying the consumer price index over this period of time now places Phoenix Arizona Real Estate at a normal level based upon the starting date of 1999 to present, or said another way, pricing of Phoenix Arizona real estate is in line with inflation over this period of time.

The Phoenix Real Estate Market Monthly Median Sales Price has seen an abrupt increase from January 2013 thru July 2013 with relative flattening of Maricopa County Real Estate prices since that time.  Interestingly, there has been a slight downturn in Median Sales Prices over the last 8 months, albeit slight.  Overall, we have seen pricing stability for the most part.

scottsdale arizona home median sales price,phoenix arizona home median sales price,cave creek arizona home median sales price,carefree arizona home median sales price,rio verde arizona median home sales price

Phoenix Arizona Under Contract Listings market segments have changed over the last year. As homes under $100,000 were gobbled up the inventory either shrunk or the fewer buyers of under $100,000 are in the market place.  We see more activity in the $200,000 to $250,000 home prices. There is roughly a 50% increase in the homes under contract over $500,000 from last year to now.

scottsdale arizona homes listings,rio verde arizona homes listings,carefree arizona homes listings,cave creek arizona homes listings
Phoenix Arizona Homes Listing Count


The Cromford report produces a dial indicator of Phoenix Arizona Real Estate Market activity.  This index expresses the correlation between supply and demand.  Currently, we are seeing rising inventory a decreasing demand resulting in the apparent shift back towards a "buyers market".

scottsdale housing market,phoenix arizona housing market,cave creek arizona housing market,carefree arizona housing market
Market Index


The next chart supports the data that the Phoenix Arizona Real Estate Market is seeing a shift back to a "buyers market" with the chart reflecting the graph shifting below a "balanced market".  This is a result of less demand and more inventory.

scottsdale arizona real estate market,cave creek arizona real estate market,carefree arizona real estate market,rio verde arizona real estate market,rio verde foothills real estate market
Buyers Market Evolving


A narrative of the factors contributing to the "market shift" are shown below in the slide.

scottsdale arizona home forecast,cave creek home forecast,carefree arizona home forecast,rio verde arizona home forecast
Phoenix Arizona Real Estate Forecast


The implications on real estate sales in Phoenix Arizona are expressed below:

phoenix arizona buyers market,scottsdale arizona buyers market,cave creek arizona buyers market,carefree arizona buyers market,rio verde arizona buyers market
Implications of a Buyers Market


Maricopa County Arizona Real Estate Demand has dropped for the following reasons:

scottsdale arizona home demand,rio verde arizona home demand,carefree arizona home demand,cave creek arizona home demand


Real Estate Foreclosures in Arizona are some of the lowest in the Nation:

arizona reo properties,arizona foreclosure,arizona home foreclosure,scottsdale home foreclosure,carefree arizona home foreclosure,cave creek arizona home foreclosures
Non-Performing Loans


The Arizona Real Estate Crash left some 26% of the population without homes.  Those people moved to other states or are in the rental pool at the moment.  With consumer credit destroyed it will take some time before these people can enter the home ownership market again.

scottsdale arizona real estate crash,carefree arizona real estate crash,cave creek arizona real estate crash,rio verde arizona real estate crash
Phoenix Arizona Real Estate Crash

Now, let's take a moment to look at a growing sector of the Maricopa County Real Estate Market, the Luxury Market.  For many years the luxury market has taken a significant beating with pricing and absorption.  A recent phenomenon is the renewed interest in Phoenix Luxury Homes.

scottsale arizona luxury home market,cave creek arizona luxury home market,carefree arizona luxury home market,rio verde arizona luxury home market
Phoenix Arizona Luxury Home Market

Go figure, but there has been a shift in the purchasing mentality of available home buyers.  Many are called the "millenial" group, a growing population of potential buyers that aren't buying.

phoenix arizona household creation,scottsdale arizona household creation,cave creek arizona household creation,carefree arizona household creation
Household Creation


So, where does all of this research into the Phoenix Real Estate Market leave us?  Well, for one, having to adapt but recognizing the changing mindset and demographics.

phoenix mls homes for sale,scottsdale mls homes for sale,cave creek arizona mls homes for sale,carefree arizona mls homes for sale,rio verde arizona mls homes for sale
Real Estate Outlook

Not the most positive information but factual and for the most part prediction that home sellers and Realtors will have to do their homework to be successful in the current market.....just remember though, as soon as we figure it all out, it will change again, which leads me back to the my favorite analogy....the Real Estate Cycle as shown below.

scottsdale arizona real estate market cycle,cave creek arizona real estate market cycle,rio verde arizona real estate home market cycle,carefree arizona real estate home market cycle
Market Cycles

Thank you for taking time and allowing me to share with you the information as presented by Mike Orr, the Cromford Report.  

And...for your next real estate transaction be sure to give me a call!  I used to say over 33+ years of real estate experience....well, that is old news now but I have just about "Seen it ALL".  

"Always Available", be sure to give me a call.  I have experience in all "Facets of the Real Estate Industry".

scottsdale arizona,schools,floodplain,north scottsdale realtor,carefree realtor,cave creek realtor,boulders realtor,desert mountain realtor,scottsdale realtor
Jeff McDowell, North Scottsdale Realtor 623.262.0811 EMAIL ME




















Comments (1)

Mark Loewenberg
KW of the Palm Beaches - Palm Beach Gardens, FL
KW 561-214-0370

great way to showcase your local market to the area buyers and sellers!

Mar 12, 2014 12:34 PM