NW Phoenix Real Estate Guide

At the risk of becoming completely monotonous, my post this month is almost going to be a duplicate of last month with only a couple of differences, but major differences nonetheless.  I’ll try to spare you the usual long-windedness and go right to the charts.  Remember, click on any of the charts to see the larger version (opens in a new window).

What do I say that is different from the month before here?  Nothing really except that active listings in the Phoenix real estate market are down again.  In fact, they are down to 4.23 months worth of inventory – technically a seller’s market, but as I said last month, it’s really only a seller’s market in certain price ranges.  I’ll make an illustration on this point below.

Again, sold units are up, and because of the enormous demand for well-priced homes (i.e., bank-owned, short sales, etc), it continues to bring down the overall amount of time it takes to actually sell the home.  That point is amazing to me because there is a sizable chunk of the market that isn’t selling and continues to accumulate days on market, so I would for this trend to reach a point of diminishing returns, so to speak, and flatten-out and eventually trend back upward slightly.

This is a pretty interesting chart.  By looking at it, we can see that sold dollar volume is actually on par with sold dollar volume 2 years ago, but what is interesting is that homes, roughly speaking, cost half as much as they did then.  Does that tell you how many units we have sold compared to 2 years ago?  That’s right – about twice as many.

We’ve seen these numbers already, but we certainly see the upward movement in sales prices steadily over the last 3 months in total amount of about $13,000.  This is about how much value a home in this market has lost every 2 months for the last 2 years, so I cannot over-emphasize how important this shift is. 

As I noted in previous posts, this one is a bit difficult to gauge right now, and I will make some observations on this chart going forward as I have more data to work from, but I will say that the average reduction in price for active listings continues to decrease as a percentage of list price, and that’s something that we’ve continued to observe for about the last six months, and I hope it continues.

What do we make of all of this?  As I mentioned above, it certainly is a seller’s market based on the numbers, but it really is a tale of 2 markets.  On the one hand, we have the distressed property market, and on the other hand, we have everything else.  The distressed property market is SOOOOOOO hot right now (and has been) that it is making the entire market look good. 

Here is an email that I sent to some colleagues this past week concerning these numbers:  

Thought you might find these numbers interesting—they give us a little peek at the answer to my questions earlier:  For June 2009, the ‘sold avg. list price’ was $178,272 & the ‘sold avg. sale price’ was $171,781 for a 96.4% SP/LP ratio, and interestingly, the ‘new listing avg. list price’ is $230,421.  Do you wanna take a guess at the ‘active listing avg. list price’?  It’s $392,538.  In a market where we’ve seen some pretty wild swings in the numbers this is one that has not changed all that much.  In the last 2 years, that number has stayed within a $70,000 bracket—In July of 2007, the ‘active listing avg. list price’ was at a peak of $417,603 and a low in January of 2009 of $342,997.  Like I said, it doesn’t tell the whole story, but it certainly fills in some of those blanks.