Market Update - July 2024

In today's LUXE BLOG, we will be sharing more info on how the housing market in Greater Phoenix is seeing changes. Inventory is up, and supply has spiked year-over-year. Is this a cause for concern? Below, we get into some of the recent numbers and what they mean, For both buyers and sellers alike. Before we get started, we want to thank you for choosing WilliamsLuxuryHomes.com to keep you up to date on the market.

Inventory Surge

Inventory levels are striking, showing a noticeable increase from last year. Here’s a closer look:

• Current active listings: 15,890 homes
• Last year’s listings: around 10,000 homes
• Increase in single-family homes: 57% year-over-year

This surge can be both promising and worrying, depending on your perspective.

Price Range Breakdown

Let’s examine how inventory changes vary by price range:

• Below $300,000: up 94%
• $300,000 - $350,000: up 64%
• $400,000 - $450,000: up 76%
• $500,000 - $600,000: up 77%
• $1M - $1.2M: up 64%
• $5M - $7.5M: up 59%
• $700,000 - $800,000: up 31%
• $2M - $3M: up 28%
• $7M - $10M: up 35%

Higher inventory means more choices for buyers but increased competition for sellers.

Also Read: Housing Market Sees Renewed Interest As Mortgage Rates Drop

Market Implications

What does this mean for the market?

• Buyers: More options, slower decision-making, analytical approach
• Sellers: Increased competition, slower sales, potential frustration

As demand remains low, influenced by high mortgage rates, supply continues to accumulate, affecting market dynamics.

Economic Factors

The economic backdrop plays a crucial role in shaping the housing market. Recent job reports indicate a cooling labor market, potentially leading to lower mortgage rates. Here’s a quick summary:

• Soft jobs report suggests potential for rate cuts
• Inflation data and FED’s actions closely watched
• Mortgage rates recently dipped below 7%

These factors could positively impact both buyers and sellers, offering some relief from high-interest rates.

Mortgage Rates & Election Year Trends

Historically, election years see a trend of declining mortgage rates. Here’s why this year might follow suit:

• Potential for FED rate cuts in September
• Mortgage rates may soften ahead of the election
• Positive signs for both buyers and sellers

A recent example: Clients secured a 2.75% interest rate by assuming an existing mortgage. Sellers should check if their mortgages are assumable, offering a competitive edge in the market.

Also Read: The Ongoing Seller’s Market: Rising Prices & Waning Affordability

Cromford Market Index

The Cromford Market Index (CMI) gives us a snapshot of the market’s balance:

• Current CMI: 100.9 (balanced market)
• Demand: 24% below normal
• Supply: 26% below normal

Transaction volumes have crashed, not prices. The market is moving towards a buyer’s market, with many cities showing a shift from seller’s market status.

Assumable Mortgages

Sellers with assumable mortgages have a unique advantage. Example:

• Clients assumed a 2.75% mortgage rate
• Requires making up the loan-purchase price difference
• VA and FHA loans often assumable

Checking if your mortgage is assumable could be a game-changer in attracting buyers.

Final Thoughts

As it always has, and always will, the Arizona housing market is experiencing shifts. The good news? Opportunity comes with increased real estate inventory. Not to mention challenges. Telltale economic signs suggest potential rate cuts. This would be great news as at would ease pressure on the market. Did you enjoy this content? Stay tuned for more updates on LUXE BLOG!