We are now in the heart of the spring selling season and yet it doesn’t feel like prime time. The market has been quieter than we had anticipated at the beginning of the year. The greater Phoenix market has drifted into a balance – as homes for sale have slowly accumulated and demand has waned under the pressure of rising interest rates.
The numbers below provided by Tom Ruff of the Stat as well as the Cromford Report – confirm 2024 first quarter lackluster numbers:
• In the first quarter, demand was approximately 5% lower year over year. (Note: 2023 was a very low volume market historically)
• In February and March, in terms of sales per day, there were 15 fewer sales per day this year compared to last.
• Demand is down approximately 26.02% from the first quarter of 2020. (pre-COVID)
• Sales volume for Q1 2024 is down 31.61% from Q1 2021. (COVID buying frenzy)
• The median sales price is 5.65% higher year over year, home prices are stable.
• Listings under contract are only down 6% compared to last year, but active listings are up 26%.
• Flip sales are down 74% from 2 years ago and at a level comparable to 2015.
The luxury market is still holding up (although also not as strong as last year) as it is generally unaffected by interest rates. Additionally, builders have grown their market share by offering lower than market rates (i.e. bulk buying loan money). That strategy is paying off as new home market share is now 22.6%, while only 3 years ago they were less than 15% of the total units sold in residential homes & townhouse/condo sales.
Takeaways: Sellers now are competing again for buyers especially against new builds and should look to their REALTOR® for advice on how to maximize time on market and net. Prices are holding at the moment.
Buyers should be relieved to see more home choices than in years accompanied by stable pricing. Interest rate concerns can be addressed by rate buy downs (ask us!) or by purchasing a new build.
Whether buyer or seller – a quiet market does present opportunities. Contact us for ways to maximize your dollars.
Russell & Wendy Shaw
(mostly Wendy)