Sellers Losing Ground
Boom! There’s no other word for it. Right now, the housing market is a topic of heated discussion. The stats and debates are all over the place. But could we be standing at the edge of a buyer’s market, especially in Greater Phoenix? That’s what we’re breaking down today. Why? Because month-over-month, EVERY city in Greater Phoenix trended is buyers’ favor. And that hasn’t happened since mid 2022 or so.
Housing Sentiments Nationwide VS Greater Phoenix
Let’s kick this off by setting the scene. Nationally, surveys show that 84% of people think now is a bad time to buy a house. In Greater Phoenix, we’ll dig into the data to see if this sentiment holds true.
- Fanny Mae survey says 84% nationwide think it’s a bad time to buy
- Mortgage rates are over 7%, causing hesitancy
- Seller concerns rising, up to 37% from 34% in August
- 177% believe mortgage rates will decrease next year, while 46% see an increase
The key takeaway? While the national sentiment is glum, in Greater Phoenix, the story might be a bit different. Let’s see why.
Also Read: Just Listed! Fully Renovated Townhouse In Old Town Scottsdale
Mortgage Rates Are Over 7%, Causing Hesitancy
Mortgage Rates & Jobs Report
The U.S. economy is showing mixed signals, and that’s impacting mortgage rates. Rates have surged towards 8% following a robust jobs report, but what does that mean for the Greater Phoenix area?
- U.S. added 336,000 jobs, nearly double the expectation
- High employment typically drives up mortgage rates
- Mortgage rates around 7% deepen consumer hesitancy
What you need to remember is that while the U.S. jobs market might be booming, it could have a ripple effect on mortgage rates, which in turn impacts the Phoenix housing market.
Active Listings In Greater Phoenix
Now, let’s zoom into our neck of the woods—Greater Phoenix. Active listings are showing interesting trends worth dissecting.
- Active listings up by 22% in last 10 weeks
- Unusual increase compared to seasonal norms
- Cromford Report indicates outside-the-box shifts
What’s significant here? Active listings are rising faster than expected, suggesting sellers are starting to compete, potentially softening prices.
Supply, Demand, & Listings Under Contract
Here’s where things get really intriguing. While listings are going up, listings under contract are showing a downward trend. This imbalance hints at shifts in the market.
- Listings under contract decreasing since May
- Higher supply meets lower demand
- Similar pattern seen in 2006, but not suggesting a crash
So, the market’s shifting gears. Greater Phoenix could be in a unique position for buyers, particularly if these trends continue.
When Could It Be A Good Time To Buy?
With all these stats and shifts, you might be wondering, “Is this the time to buy in Greater Phoenix?”
- Seasonal trends favor buyers during the holidays
- Supply increases and lower demand mean more options
- Negotiation likely easier with more competitive sellers
Look, if you’re considering buying, especially during the holiday season, it might be a prime opportunity. However, the usual caveats apply: make sure it’s a long-term commitment and you can afford it.
Also Read: Real Estate Trends For Greater Phoenix As Of Early October
The CMI For Overall Greater Phoenix Was 137 As Of October 11th, 2023
Cromford Market Index (CMI)
The Cromford® Market Index (CMI) serves as a yardstick for the real estate market’s pulse in various cities across ‘The Valley’. When searching for real estate, one invaluable resource is the Cromford Market Index. This composite index is meticulously designed to gauge both the demand from buyers and the supply dynamics from sellers. It provides an encompassing picture of market health. By pulling data from 17 pivotal cities in the Greater Phoenix region, the CMI delivers a quick yet robust snapshot of individual area conditions. In essence, this index serves as a vital tool for understanding the overall market vitality. And it helps us as real estate professionals better PROTECT and INFORM our clients. And then negotiate on their behalf.
*Per Cromford Report as of October 11th, 2023
- CMI for Greater Phoenix at 137
- Demand is at 74, supply at 54
- Both are below the normal range of 100
We’re still technically in a seller’s market, but these numbers indicate that buyers could gain some ground. In a nutshell, it’s a situation to keep an eye on.
The Cromford® Market Index (CMI) serves as a yardstick for the real estate market’s pulse in various cities across Greater Phoenix. The data is sorted by the highest CMI to the lowest for October 5, 2023. Here, each city is dissected based on its CMI and the monthly change.
City By City – CMI
*All Below Numbers Are As Of Oct. 5th, 2023
Chandler
- CMI Now: 201.7
- Monthly Change: -25%
Despite a 25% decline, Chandler maintains the highest CMI.
Fountain Hills
- CMI Now: 185.3
- Monthly Change: -1%
Fountain Hills exhibits minimal change, losing just 1% over the last month.
Glendale
- CMI Now: 181.9
- Monthly Change: -8%
Glendale has witnessed an 8% dip but remains in the top three.
Phoenix
- CMI Now: 178.0
- Monthly Change: -9%
Phoenix registers a 9% decrease but still sits comfortably in fourth place.
Paradise Valley
- CMI Now: 172.6
- Monthly Change: -11%
With an 11% decline, Paradise Valley still clinches the fifth spot.
Gilbert
- CMI Now: 170.2
- Monthly Change: -11%
Gilbert matches Paradise Valley’s 11% decrease but lags slightly in the index.
Mesa
- CMI Now: 161.3
- Monthly Change: -16%
Mesa’s 16% decline is one of the steepest in this list.
Scottsdale
- CMI Now: 156.1
- Monthly Change: -9%
Scottsdale sees a 9% reduction but retains its appeal.
Cave Creek
- CMI Now: 154.1
- Monthly Change: -9%
Cave Creek records a decline similar to Scottsdale, dropping 9%.
Avondale
- CMI Now: 149.0
- Monthly Change: -10%
Avondale marks a 10% monthly decrease but secures a top-10 position.
Peoria
- CMI Now: 132.8
- Monthly Change: -7%
Peoria experiences a 7% slide, yet manages to hold its rank.
Tempe
- CMI Now: 129.6
- Monthly Change: -4%
A modest 4% dip places Tempe just behind Peoria.
Surprise
- CMI Now: 114.8
- Monthly Change: -5%
Surprise takes a slight 5% hit, further down the list.
Buckeye
- CMI Now: 95.5
- Monthly Change: -19%
Buckeye’s sharp 19% decline is alarming, causing it to plummet in rankings.
Queen Creek
- CMI Now: 91.7
- Monthly Change: -9%
Queen Creek also witnesses a 9% reduction, settling towards the bottom.
Goodyear
- CMI Now: 90.5
- Monthly Change: -19%
Goodyear shares Buckeye’s drastic 19% fall, sinking to near the bottom.
Maricopa
- CMI Now: 90.4
- Monthly Change: -17%
Maricopa barely skirts the bottom, its 17% decline being the least among the lowest-ranked cities.
The overall trend indicates a general decline in the market across most cities. To stay abreast of these shifting dynamics, be sure to check out our LUXE BLOG regularly.
Every City In Greater Phoenix Saw A Drop In Its CMI Month-Over-Month
City-by-City CMI Analysis
Finally, let’s break down how various cities in Greater Phoenix are doing based on their individual CMIs.
- Chandler losing momentum with high negative change
- All major cities showing red arrows, indicating seller loss
- Goodyear, Buckeye, and Maricopa falling significantly
The absence of green arrows is glaring, signaling that the tables may be turning. For buyers, it’s a glimmer of light at the end of a very long tunnel.
To Sum It All Up
If you’re thinking about looking into the Arizona real estate market, we’d love to know. It’s essential to know the market’s pulse. And right now, that pulse is saying, “Hey, pay attention; things are getting interesting!” When you’re ready, WLH will be here. Thanks for reading LUXE BLOG. See you next time.