Metro Phoenix Valley Experiencing a Market Frenzy in July – for the average priced home buyer anyway
Data and excerpts from The Cromford Report, Arizona’s most respected source, July 24, 2020
July 8 2020: 1.4 Million Homes and less than 8,600 Listings
Greater Phoenix has a population of approximately 4.8 million people and 1.4 million residences total. As of July 8th, only 8,579 were listed on the local MLS. Greater Phoenix has 30,000 to 35,000 listings in a “normal market.”
New listings in June compared to same time last year overall were down 7.8% (down 22% for homes under $300,000 – which has reached 38% to date in July) while contracts in escrow were 24% higher.
Finding your new home under $300,000 is nearly impossible
If those numbers doesn’t cause you to gasp, then this might: only 1,023 of the 7,700 active listings are single family homes under $300,000, and that number is diminishing every day. The last month has seen a surge of buyer activity, but it was not met with an equivalent surge of new listings. For buyers under $300K, new listings were down 22% in June compared to last year, and are down 38% so far in July. This is causing quite a bit of buyer competition for move-in ready homes in this price range.
New Home Construction
For buyers over $300K, the new home construction adds additional inventory and is providing some much needed alternatives. The top 3 cities for single family home permits are Phoenix, Mesa and Buckeye. Notable spikes in building permits issued can be found in Surprise, Maricopa and Queen Creek. Most new homes are selling between $300K-$500K, but buyers looking for a brand new single family home under $300K still have some options. Their best bet is in Pinal County or Buckeye with average sizes between 1,800-2,000 square feet for their budget.
Homes over $500,000 are strong, but nowhere near the frenzy
Conversely, new listings over $500K saw a spike last month, up 20% over last year. 1,596 new listing came on the market and 2,046 contracts were accepted in this price range in June.
Brace yourselves. Half of the sellers who accepted contracts under $400K in the first week of July were on the market for just 8 days or less with their agent prior to contract acceptance. Sellers who took contracts between $400K-$600K had a median of 14 days on the market with their agent. Sellers who landed contracts between $600K-$1M had a median of 41 days. It’s a good time to be a seller.
Sellers Getting Over List Price
While 28% of all sales in July so far have closed over asking price, that percentage peaks at 41% for those between $200K-$300K. Top cities for closings over asking price are Tolleson, Avondale, Glendale, Gilbert and Youngtown. Gilbert is the only city in that list with a median sale price over $300K. Seller-assisted closing costs remain popular and were involved in 23% of all sales in the first week of July. That percentage increases to 33% on transactions closed between $150K-$300K. Top areas where 50%-60% of sales involved seller accepted closing cost assistance were Youngtown, West Phoenix, Aguila, Glendale, and Tolleson. This supports the theory that sellers receiving offers over asking price in the West Valley and other affordable areas are still open to accepting closing cost assistance if a contract meets their most important needs.
See the charts and graphs supporting this month’s market report here.
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About the Author: Denise van den Bossche has been a licensed Agent and homeowner for over 35 years in the Metro-Phoenix Scottsdale Valley of the Sun. A Legacy LEED® AP, designated SRES, DMX, ePro, EcoBroker and co-founder of Seniors Advisors Advising Seniors®, a consortium of experts to surround and support families facing aging or chronic illness. To request a no-obligation market report, home evaluation, or consumer guide on your specific needs, contact Denise at 602.980.0737 or email Denise@AZMultipleListingService.com. Denise’s husband Patrick is President of Realty Executives International, with 500 offices throughout North America.
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