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Greater Phoenix Ranks 2nd For Price Reductions In March Report

Greater Phoenix Price Reductions

Really? Yes, really. As the Spring season unfurls, the housing market across the United States, especially in the Phoenix Metro, presents promising signs for buyers. According to the latest March housing report, there's a significant uptick in housing price reductions in 'The Valley of The Sun'. This is coupled with an increase in inventory. This scenario is setting the stage for what could be an advantageous market for homebuyers. What will happen? We don't have a crystal ball. But we do have data. So let's take a look at it!

Growing Buyer Optimism

With the latest data, the climate seems increasingly favorable for those purchasing homes. Yes, buyers.

  • The Phoenix Metro saw homes with price reductions rise to 23%
  • Inventory of homes for sale grew by 23.5%
  • Largest share of price reductions in five years at 15.0%
  • U.S. South region saw price reductions up by 3.5 percentage points
  • Midwest region experienced a 1.0 percentage point increase
  • Northeast region's reductions up by 0.5 percentage points
  • Slight increase in the West, by 0.2 percentage points

As more homes enter the market and sellers become more competitive with their pricing, this shift could lead to a more balanced buying environment. Due to high interest rates, this is especially helpful for home buyers.

Also Read: Analyzing Expert Predictions For The 2024 U.S. Housing Market

Kitchen of a luxury home.

As Interest Rates Stay High, More Listings Are Coming On The Market

Top Metro Areas With Price Reductions

The trend of increasing home inventory and price reductions isn't confined to 'The Valley'. Several other metro areas across the country are experiencing similar patterns. Below you can see stats from many places across the United States.

  • Memphis, Tenn.-Miss.-Ark. – 19.3%
  • Dallas-Fort Worth-Arlington, Texas – 19.5%
  • Miami-Fort Lauderdale-Pompano Beach, Fla. – 19.7%
  • Portland-Vancouver-Hillsboro, Ore.-Wash. – 20.1%
  • Orlando-Kissimmee-Sanford, Fla. – 20.2%
  • San Antonio-New Braunfels, Texas – 21.8%
  • Jacksonville, Fla. – 22.1%
  • Austin-Round Rock-Georgetown, Texas – 22.3%
  • Phoenix-Mesa-Chandler, Ariz. – 23.0%
  • Tampa-St. Petersburg-Clearwater, Fla. leads with 27.6%

This widespread increase in inventory and price reductions indicates a softer market. Hence, more power to purchasers. This is something we expected with ongoing inflation and a delay of The Fed lowering interest rates. Back at the start of 2024, it was expected rates would be much lower by June 2024 or so.

Also Read: Seller’s Guide To Arizona Real Estate Cancellation Clauses

Photo of a home's patio area.

Many Metros In The U.S. Saw Listing Prices Drop

Inventory & List Price Trends

While the overall inventory remains lower than pre-pandemic levels, there's a noticeable improvement in the number of homes available for sale. 

  • Inventory at its highest since 2020
  • Homes priced between $200,000 and $350,000 saw a 30.5% increase
  • Median list price increased slightly from $415,500 to $424,900
  • Substantial gains in active inventory in cities like Tampa (+58.3%), Orlando (+53.3%), and Miami (+48.2%)
  • National median list price increase was minimal year-over-year, only 0.2%
  • In two weeks of March, the median list price dipped below last year’s levels
  • 18 of the 50 largest metros saw their median list price decline, including:
    • Miami: -8.4%
    • Oklahoma City: -8.3%
    • San Francisco: -7.6%
  • Largest increases in median list price observed in:
    • Los Angeles: +15.1%
    • Richmond: +11.8%
    • Pittsburgh: +11.6%
  • Mortgage rates remained between 6.6% and 7% over the past three months
  • Cost of financing a home increased by $63 compared to last March due to higher rates

Also Read: Year-Over-Year Analysis Of The Scottsdale Real Estate Market

A modern luxury property.

The Report Said Inventory Is At Its Highest Since 2020

Our Final Thoughts

The current trends in the housing market are good for homebuyers. This could be an opportune time with increased inventory and more competitive pricing. It will be interesting as summer approaches. And whether they will lead to a more balanced market overall. As of April 18th, 2024, the overall Cromford Market Index for the Phoenix Metro was 111.5. That is just 1.5 points above the starting number for a seller's market (110). This is one of the lowest CMIs we've seen in a while. The Greater Phoenix Area's CMI was well over 400 during the pandemic. This was when the local market appreciated 30+% annually. What does a CMI of just 111.5 equate to in appreciation? While the answer isn't clear-cut, it's not much. If anything. 

2024 has been a tough year for the Arizona real estate market. At least for sellers! When will things improve? We'd love to hear your thoughts. Feel free to send us an email using the contact form below. Specializing in the Greater Phoenix market, Williams Luxury Homes is always interested in hearing from others. We are constantly updating LUXE BLOG with updated stats. We hope you enjoyed today's piece.

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