Greater Phoenix Market Update

As we head into the holiday season, the Greater Phoenix real estate market is shifting. Listing success rates are lower than last year, inventory is climbing, and mortgage rates remain a key factor in buyer behavior. While the market isn’t in freefall, it’s clear things have slowed compared to recent years. Here’s a breakdown of the latest trends shaping the Greater Phoenix housing market. Questions? Feel free to reach out via the below contact form.

Listing Success Rate Trends

The listing success rate measures how often homes sell instead of expiring or being canceled. Historically, this is a key indicator of market strength.

• Current rate: 71% (slightly above the long-term average of 68%).
• A year ago: 75%, indicating a stronger market at that time.
• Pandemic years saw unusually high success rates, often exceeding 80%.

While still above historical averages, this year’s listing success rate feels sluggish compared to the booming years of 2020-2022. For sellers, pricing and presentation are more critical than ever. For buyers, a slight increase in inventory means more options but also the possibility of price adjustments.

Also Read: Another Land Deal In The Scottsdale Road & Loop 101 Corridor

Active Listings Are Increasing

Active listings have grown steadily over the past 11 weeks. Currently, the Phoenix metro area has over 19,000 active listings.

• Supply is outpacing demand.
• Inventory levels are climbing but remain moderate.
• The increase in supply without matching demand puts downward pressure on prices.

Buyers have more leverage now, especially in specific areas. Sellers may need to adjust expectations as the market cools.

Demand Remains Subdued

Buyer activity has slowed due to affordability challenges and rising mortgage rates. The average 30-year fixed mortgage rate recently hit 6.68%, up from earlier lows this year. Buyers are cautious, with many waiting for rates to stabilize or drop.

• Affordability remains a significant barrier for many.
• Rising monthly payments discourage first-time buyers.
• Some buyers are holding off until the new year, hoping for more favorable conditions.

This tepid demand has kept transaction volumes below last year’s levels.

Shifts Toward A Buyer’s Market

The Cromford Market Index (CMI), which measures market balance, now sits at 92.6. This number indicates a market leaning toward buyers. Here’s what to know:

• A balanced market is between 90-110.
• Below 90 is a buyer’s market.
• Some cities, like Buckeye, Maricopa, and Queen Creek, are already in buyer territory.

These changes mean buyers may find better opportunities, especially in outlying areas.

Also Read: If You’re Selling Your Scottsdale Home, Here’s What Buyers Want

City-Specific Market Conditions

Different parts of the Valley are experiencing varying levels of market activity:

• Cities in a buyer’s market: Buckeye, Maricopa, Queen Creek, Goodyear, and Surprise.
• Balanced markets: Tempe, Cave Creek, and Paradise Valley.
• Shifting away from seller’s markets: Gilbert, Chandler, Scottsdale, and Fountain Hills.

Sellers in these areas may need to price competitively to attract buyers. Meanwhile, buyers could negotiate better deals.

What To Watch In The Coming Months

Several factors will shape the market as we move into the holiday season:

• Mortgage rates: Small shifts can significantly impact demand.
• Seasonal trends: November through January often favor buyers.
• Supply levels: Continued growth could further cool the market.

Buyers waiting for better deals may find the next few months promising. Sellers should focus on pricing competitively and marketing effectively.

The Greater Phoenix housing market is transitioning. Whether you’re buying or selling, staying informed about local trends is essential. Keep an eye on inventory, pricing strategies, and mortgage rate movements to make the best decisions.

Need representation? Learn about our boutique Scottsdale real estate brokerage here. ‘Part Digital, A Whole Bunch Human’, Williams Luxury Homes knows the market well. And most importantly we educate our clients and look out for their best interests.