Phoenix Real Estate Trends May 2015

phoenix real estate market trends may 2015 infographic

Double click on the image to enlarge.

Welcome to our Phoenix Real Estate Trends May 2015 report. We have good news for home sellers and slightly less favorable news for those looking at buying a home or condo. The article covers the greater Phoenix real estate trends so it is of a more general nature. If you’d like information about your specific zip code or region, drop us an email at info@UrbanConnectionRealty.com. BTW: Click on the small infographic (right) to enlarge and see some overall numbers. Special thanks to FNT for putting it together.

Phoenix Real Estate Trends May 2015 – Overview

At long last we are seeing an increase in demand. It has been some time since we wrote those words. Those selling homes in the under $300,000 range are seeing strong demand and not a lot of competing inventory. The result is lower priced homes are experiencing a significant upswing in value.

The biggest demand is for homes priced under $200,000. This is often the first-time buyer price point or those who lost homes during the market downturn. As we’ve mentioned in the past, 5-6 months of supply is a good stable number. Take a look at some stats from the Cromford Report as to where we are at today:

For the market as a whole we currently see 3.1 months of supply, which is significantly below normal, but not excessively so. However, when we look at the single-family market by price range we see certain price bands with much lower supply:

  • $100K-$125K – 1.3 months (versus 2.3 on May 1, 2014)
  • $125K-$150K – 1.4 months (versus 2.3)
  • $150K-$175K – 1.6 months (versus 2.6)
  • $175K-$200K – 1.8 months (versus 3.0)

As you can imagine, first time buyers looking for homes in the under $200,000 range are finding slim pickins. Mike Orr at ASU tells us that just a few years ago we had about 7000 active listing in the $100k-$150 range. Below are some city numbers from May, 5, 2015 on ARMLS.

# Of Homes In The $100k-$150k Range

  • Phoenix: 238
  • Glendale: 35
  • Peoria: 9
  • Chandler: 4
  • Tempe: 2

As we look at higher priced homes we are happy to report home sales are strong as we move up above the $350,000 price point. These homes are outside qualifying limits for FHA loans so conventional, VA loans and cash are needed to make a purchase.

Phoenix Real Estate Trends May 2015 — Conclusions

phoenix real estate market trends may 2015 home pricesWe are nearing the end of our traditionally vibrant sales market. Families want to settle in by mid to late July for the upcoming school sessions. Out of town and local buyers will soon be vacationing in cooler climates causing the normal slower summer market. Expect these factors to influence sales from July to late September.

We expect lower priced homes (under $225,000) to continue to do well all summer. There simply isn’t enough inventory and buyers are sitting on the fences waiting to find their perfect place.

The upward movement in home values should help home sellers gain the necessary equity to put places on the market. There are still a lot of people whose mortgages are underwater or just breaking through the ice. Additional gains in value will certainly gives these folks some breathing room. The good news is more homes will be available. ( The graph to the right shows long term changes in the price/sq.ft. numbers. You can clearly see the market highs, lows and recent upward swing in home values based on price per square foot. Graph courtesy of the Cromford Report.)

All in all, the mid April-May Phoenix real estate market is doing well. A little boost in demand, prices rising at manageable/reasonable levels and consumer confidence in the greater Phoenix real estate market is pretty darn good. The only challenge we see in the immediate future is inventory for people shopping for lower price homes. If you are the home seller in that price range things are looking good.

We hope our Phoenix Real Estate Market Trends May 2015 report is helpful. If you have specific questions, just use the form below and we’ll get back to you ASAP.

The Urban Connection Team

Comments

  1. I see no comment on the over 600k market, lets just say it is as cold as a winter day in Minn.?

  2. Author

    Hello Sue, thank you for your comments in response to our “Phoenix Real Estate Trends 2015” post. We apologize for the slow reply as the Urban Connection website is currently in transition from the Urban Team to The Caniglia Group and your message was in limbo for a while. There is no doubt that the market for homes priced above the $450,000 range is slower than the market for lower priced homes. There are simply less qualified buyers for homes priced around $450,000 and above, so the market typically moves slower overall. While the inventory levels in the $600k range are still relatively low at the moment, homes in this price range are sitting on the market longer and showing activity has been slower. Here is a quick breakdown of inventory levels in the downtown Phoenix area in the $500,000-$700,000 price range:

    There are 15 properties currently available in MLS listed between $500,000 and $700,000. Ten are single family homes and five are apartment style/flat properties. The average days on the market for these 15 properties is 140 days.
    There are 3 properties currently under contract in MLS listed between $500,000 and $700,000. One is a single family home and the other two are apartment style/flat properties. The average days on the market for these 3 properties was 39 days.

    There have been 8 properties that have sold (closed) in the last 3 months for between $500,000 and $700,000. Seven were single family homes and one was an apartment style/flat property. The average days on the market for these eight properties was 67 days.

    I hope this provides you with a general idea of the activity levels in the $600k price range. The last few months have been relatively slow in this price range, but things seem to be picking up a bit as schools are now back in session. We anticipate activity to increase further as the Summer winds down in late September and into October.

    Please let us know if you have any additional comments or questions. We are happy to help and are always available.

    Thank you!

    Steve Caniglia
    The Caniglia Group
    Realty Executives
    http://www.thecanigliagroup.com
    602-301-2402

Leave a Comment