Market Update March 2024

With many existing homeowners staying put these days, more attention is placed on first-time home buyers, affordability, and supply of homes.

As of 2/17/2024, there were 366 active single-family listings between 1,200-1,500 square feet, with 3+ bedrooms, under $370,000 in ARMLS. Of those, 312 listings were under contract. Using these parameters, the difference between buying and renting is only a couple hundred dollars per month* and doesn’t seem to be deterring buyers in this hot market segment.

So far in 2024, listings under contract over $1M are higher than 2022, which is the #1 record year for this price range. Active listings over $1M are also at record highs, which is offsetting the increased demand, keeping price appreciation stable. Retirement communities are not experiencing the same however, as this segment is highly sensitive to inflation.

As we continue into 2024, it’s important to note, the one market generally affected by an election year is the stock market. After the last 4 elections, it has responded positively afterwards, which affects luxury buyers and retirees with a high percentage of cash purchases. If a cash buyer expects their investment portfolio to be worth more after an election, they may simply put off their home purchase until Spring. This can cause contract activity to stagnate for a couple months, but not enough to affect prices, and this mild affect can be offset by other mitigating factors, like seasonality, that would make the impact unnoticeable.

Statistics are pulled from The Cromford® Report, which provides detailed information to track the history and current status of the Greater Phoenix residential resale market and offers unique insight into its future direction.

Market Update March 2021

I feel like I’m starting to sound like a broken record, but here we are. Phoenix home values continue to appreciate, buyers continue to flock to Phoenix, and inventory continues to be scarce.

What does “low inventory” mean, beyond there are not as many houses for sale? On February 15, 2019, there were 3.3 months supply of active homes for sale. It has continued to decline until February 15, 2021, when there were 0.6 months supply of active homes for sale. So what is “months supply”? Basically, if not one single house came on the market again after February 15, every house would theoretically be sold by the time you’re reading this. To give perspective, an “even market”, meaning no advantage for being a buyer or a seller, has 6 months supply.

To say we are in a seller’s market is correct. But what I want my clients to remember is there are lots of advantages in this market for being a buyer. Low interest rates, programs allowing for lower down payments, and a strong Phoenix economy continuing to help homes appreciate in value are all great reasons to purchase a home right now. Because of competition, buyers need to be realistic in the process when submitting an offer, but there is no reason to be discouraged. Work with an experienced, professional agent who can walk you through the process and keep expectations in check while keeping morale and spirits high.

Carla Hancock explains why starting with a mortgage lender can be an important first step in the process.

“You may be hearing, “There’s not much Inventory out there”, right now. This is one reason why Kerrie will be requesting that you speak to me, a Mortgage Loan Professional, prior to house hunting. In this market, you must be prepared to put an offer in on a home quickly if you see something you like. If you aren’t prepared, the home may be under contract before you can get your pre-qualification letter, which is required when submitting an offer.

In addition to making sure you’ve submitted the necessary paperwork, the agent representing the sellers will often times contact the loan officer directly to verify the strength of the potential home buyer’s qualifications. Your loan officer will have obtained a complete, three bureau credit report, reviewed it along with income and asset documentation, and qualified you up to a maximum Purchase Power. This qualification is based on the size of the down payment, the maximum monthly mortgage payment someone can afford, or both, in addition to credit scores and debt-to-income ratios.

Having a loan officer who is able and willing to answer these questions quickly and thoroughly is a vital step in making you an attractive home buyer. In the market, buyers who are prepared, realistic, and ready-to-go are the ones who get an offer accepted!”

Statistics are pulled from The Cromford® Report, which provides detailed information to track the history and current status of the Greater Phoenix residential resale market and offers unique insight into its future direction.