Be part of the conversation: azarchitecture/Jarson & Jarson Architecture blog covers architecture and civic topics that comment on what’s happening in the Valley’s diverse design community. Here’s what’s happening now:
Here is what you have been waiting for… the ARMLS stats for February 1, 2022 compared with February 1, 2021 for all areas & types(YTY):
You may be wondering, “What do these stats mean for me if I want to buy or sell a home?” Well, we believe that the best way to win in this market is to be in the know. That is why we rely on companies like the Cromford Report to help us understand exactly what is happening as it happens. The Cromford Report is a data based reporting service based in Maricopa County that provides daily market insight into the Phoenix metropolitan area residential re-sale real estate market based on historical data collected over the years from the Arizona Regional Multiple Listing System (ARMLS). The Cromford Market Index measures the balance of supply and demand in the residential resale market. If the values fall below 100, the market is favorable for buyers. If they’re over 100, you’re looking at a seller’s market. For most of the past two years, the Cromford Market Index has been well above 100. In January of 2022, it continued to rise to 474.6. This indicates that home values will most likely rise faster over the next few months.
The current seller’s market is being driven by a severe lack of supply coupled with an increase in demand. As of the end of January, supply is still severely anemic at over 74% below what would be considered a historically “normal” level of supply. Demand, while not exceptionally high, is still higher than what would historically be considered “normal” and is holding steady at around 21% over “normal”.
To give you a better idea of what is under contract versus what is available, let’s break down Maricopa County a bit. As of 1/29, there were 1,231 properties in escrow in the Northeast Valley Cities (including Cave Creek, Carefree, Rio Verde, Fountain Hills, and Scottsdale) with only 734 active listings. There were 2,172 properties in escrow in Maricopa County Southeast Valley Cities (including Tempe, Chandler, Gilbert, Mesa, Queen Creek) with on 998 active listings. There were 2,945 properties in escrow in West Valley Cities (including Glendale, Peoria, Sun Cities, El Mirage, Youngtown, Surprise, Wittman, Waddell, Wickenburg, Buckeye, Tolleson, Goodyear, Litchfield Park, Laveen). There were 1,996 properties in Escrow in Phoenix (including Ahwautukee, Anthem, Desert Hills, Desert Ridge) and only 957 active listings. In every area mentioned above, there are significantly more properties under contract than there are active listings.
Because we are in such a hot sellers market, approximately 42.6% of homes sold over asking price. In a “normal seller market” we would typically see approximately 15-18% over asking. This is looking slightly better than mid-2021 however, when, in June of 2021, approximately 60% of homes sold over asking price.
So just how much over asking price are homes selling? Recently, the data shows that homes have been selling for a median price over list of $10,000. This is up from an average of $2,000-3,000 in a “normal seller market” but down from $20,000 over list in June of 2021.
One area that has improved over 2021 is the median sales price. Currently, the median sales price is $437,000. That is up 28.6% over January of 2021. If you are trying to calculate annual appreciation, it would be worth noting that annual appreciation is currently 26.1%. This is significantly higher than a historically “normal seller market” average of 4-10%, but lower than June of 2021 where appreciation hit 39%.
One additional statistic that tends of be indicative of which way the market is headed is the number of days a property sits on market prior to going under contract. The current Days on Market (DOM) Prior to Contract is 9 days. This is higher than DOM for much of 2021; however, looking at the data, experts says that DOM is likely to go back down to 5 again this Spring.
What does this mean for you as a buyer or seller? Two very different things! If you are planning to buy, do it now as prices are still going up. It would be smart to partner with an agent like someone from the azarchitecture team to help you find and secure the property you want. If you are thinking about selling, do it! Partnering with a seasoned agent as a seller will help you maximize this market and get the most for your home in the shortest amount of time. We would highly recommend that you have a game plan for what you will do once you sell though, and we are happy to help you develop one. Reach out to us to set up a private consultation today!