The Housing Market Shifts Slightly Towards Sellers
2024 began with a slight advantage for home sellers. Why? December typically ends with less active listings every year as a number of listings expire on the 31st. Additionally, we saw a little bump in buyer demand as interest rates became more attractive. Those two small changes pushed the market out of the balanced zone (which only lasted 7 weeks) to one that slightly favors sellers.
But saying we are in a slight sellers’ market is still misleading as most generalities are. The luxury market has performed completely differently than the rest of the market – as the luxury market is not interest rate sensitive. Beyond price points, geographic submarkets can also perform uniquely. As of the writing of this article, here is where the geographic submarkets stand according to the Cromford Report:
“Not all cities are in a seller’s market, the distribution is as follows from strongest-to-weakest:
Seller’s Markets: Tolleson, Apache Junction, Fountain Hills, Chandler, Gilbert, Laveen, El Mirage, Anthem, Glendale, Sun Lakes, Phoenix, Scottsdale, Mesa, Avondale
Balanced Markets: Tempe, Litchfield Park, Sun City West, Peoria, Goodyear, Surprise, Paradise Valley, Arizona City
Buyer’s Markets: Cave Creek, Gold Canyon, Queen Creek, Sun City, Casa Grande, Buckeye, Maricopa
Most cities are either gradually improving or holding steady in their market measures. “
This remains a muted market with contract activity well below normal (making this a good time to hug your real estate agent). As the Cromford Report states: “We are starting 2024 with one of the lowest counts of listings under contract we have ever recorded for the start of any year (5,127). We measured 5,456 last year and 9,393 in 2022. We have to go back all the way to the dark days of 2008 to find a lower count (3,468). 2007 was also very bad, but at 5,197 it just beats the 2024 reading.” Gulp. If we compare unfavorably to 2007 that is anemic indeed.
What will 2024 bring? The Cromford Report offers this: “It’s not reasonable to expect another insane market with skyrocketing prices like 2020-2021, or another 12.5% drop in values like 2022. It could be quite boring in terms of price for the first quarter, but uplifting with more traditional home buyers getting back in the game. “ Boring sounds kind of nice, doesn’t it?
Russell & Wendy Shaw
(Mostly Wendy)