The supply shortage continues. Overall, supply is currently 30.7% below normal levels while demand is right where it should be for this time of year. As predicted, the market has cooled off seasonally giving buyers a slight break from the intense competition for existing homes. The slowdown is most noticeable in the Southeast Valley, particularly Gilbert and South Chandler. The Southwest Valley has not slowed much, except for those zip codes north of the 101 Freeway such as North Peoria and North Glendale. The one thing these areas have in common is the presence of new construction. Gilbert and North Peoria are within the top 3 areas builders have chosen to file single-family construction permits. This will provide more choice for buyers, however new builds are not abundant where the most extreme supply shortage lies under $200,000.
Annual appreciation has been hovering around 5% over the past few weeks for the overall Phoenix Metropolitan Area. Due to the supply shortage under $200,000, some areas are experiencing a much higher annual appreciation rate. Those areas are mostly concentrated towards the center of the city where the average sales price per square foot is much lower than rest of the city, such as Maryvale, the I-17 Corridor, Downtown Phoenix and South Phoenix. A few exceptions are 85013 and 85021 (Central Avenue Corridor), 85016 (the Biltmore) and 85006 (south of Arcadia).
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