Before we get into the Phoenix Real Estate Market Report for July 2021, I have a commentary written by Tina Tamboer. Tina is the Senior Housing Analyst with the Cromford report. She was nice enough to let us use her summary of the Greater Phoenix Metro area as a backdrop for what is happening in Phoenix this month. Here is her commentary…
- ?️ The Greater Phoenix Metro Summary Analysis Real Estate Market Report
- ? For Buyers:
- ? For Sellers:
- What to Expect:
- You may also be interested in learning about Seller Closing Costs in Phoenix, Az.
- ? Below is a snapshot of Phoenix’s Real Estate Market Statistics for June 2021
- ?️ What are the Average Temperatures in Phoenix?
- ? A look at Phoenix’s current Sales Price. Real Estate Market Report for July 2021
- ❓ What does this mean if you are a Buyer or a Seller?
- ?️ What is the annual rainfall in Phoenix?
- ?️ Homes For Sale in Phoenix AZ
- ? Below you will see the links for the other cities in the East Valley:
?️ The Greater Phoenix Metro Summary Analysis Real Estate Market Report
What’s Ahead for Sellers as Demand Weakens
Median Sales Price Up 29%, Fewer Contracts
? For Buyers:
Buyers with budgets over $300,000 may be noticing that they have more listings to choose from compared to a few months ago. This is especially true in the price points between $400,000 and $800,000 where inventory has grown 92% since February. When a buyer has, for example, 4 or 5 homes available that meet their criteria instead of just one, they are less inclined to throw all of their ammunition into one home in order to win it. They may still offer full price or more, but may not be under as much pressure to waive contingencies and shorten inspection periods.
As this subtle change proliferates with more inventory, the buyer experience will become less stressful. As the median sale price continues to rise, affordability is something to pay attention to. Not what’s affordable to you necessarily, especially if you’re out of state, but what percentage of the local population can afford your home if you need to sell right away or sometime in the future.
A family making the median income in Greater Phoenix could afford 63% of what sold in the 1st quarter of 2021. That was within the normal range of 60-75%, indicating a good time to buy or sell. While we wait until August for the 2nd quarter measures to be released, we expect the new measure to land around 57%, slightly below normal. This does not indicate that the market will plunge into a buyer market causing prices to decline, but it does indicate a reason to expect prices to rise much slower going forward.
? For Sellers:
The Greater Phoenix housing market continues to shift from an extreme seller market into a less extreme seller market. As prices continue to rise, more new sellers are motivated to put their home on the market and fewer buyers are able or willing to pay the higher price. Over the next 5 months, give or take, the market is expected to move into a weaker seller market, driven in part by dwindling affordability and buyer fatigue.
The first half of 2021 has been so insane with contingency waivers and exorbitant offers over the asking price that many sellers may not know what a normal seller market looks like. Here are a few things to expect:
What to Expect:
- Sales price appreciation will not average 3.1% per month. April 2021 saw prices appreciate 5.1% within 4 weeks. May was 2.3%. June was 1.1%. From 2015-2019, a long-term seller market but much weaker than today, prices appreciated at an average of 0.5% per month with a range between 0.3% and 0.8%.
- There will be more list price reductions. It’s important to remember that the sales price is the LAST thing to respond in a shifting market. One of the first things to respond is a list price, in the form of a price reduction. When a seller overshoots what the market can bear, they will get the silent treatment in the form of zero offers. That triggers a price reduction by the seller. Weekly price reductions have risen 112% since mid-February from 317 in a week to 672. In a weaker seller market, expect between 1,500-2,000 price reductions every week.
- Sellers will get their price but pay more in concessions. If a seller prices their home high in anticipation of excess demand but only gets one offer instead of multiple offers, they are more likely to accept home warranties, do repairs and offer concessions. Currently, the percentage of sales involving concessions is very low at 4%, up from 2.7% the week prior. In 2019, a good seller’s market, 25% of closed sales involved seller concessions.
The commentary was written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2021 Cromford Associates LLC and Tamboer Consulting LLC
Below you will find the statistical breakdown and more for the Phoenix area Real Estate Market Report June 2021.
? Below is a snapshot of Phoenix’s Real Estate Market Statistics for June 2021
?️ What are the Average Temperatures in Phoenix?
Phoenix’s coldest month is January when the average temperature overnight is 43.4°F. In July, the warmest month, the average day time temperature rises to 104.2°F. If you would like to see specific homes as they come on the market, click here to get email updates.
? A look at Phoenix’s current Sales Price. Real Estate Market Report for July 2021
In June, Phoenix’s Median Sales Price was $365,700 from last month’s $370,000 and the prior months’ $345,000, $334,000 and $321,750. As inventory levels remain at unheard of low levels, there has been continued pressure on the sales price as folks need to bid above the listing price to be the winning bid on the house.
❓ What does this mean if you are a Buyer or a Seller?
Real Estate Market Report
As the chart above shows the Phoenix housing market Inventory remains at historic low levels. Buyers should be prepared to jump on any listing that fits their needs. With inventory at these lows, make sure you make your offer as clean as possible (no contingencies). Based on Tina’s comments above, you may have to pay over the list price to get the deal.
Sellers should expect multiple offers due to this low inventory level. We are seeing many more multiple offers as inventory drops. Know the market value of your home. When you start getting offers above list price and potential market price, be cognizant of a potential appraisal issue or look for offers with appraisal waivers/contingencies.
If you would like to see specific homes as they come on the market, click here to get email updates.
?️ What is the annual rainfall in Phoenix?
The driest month in Phoenix is June with 0.09 inches of precipitation, and with 1.07 inches March is the wettest month.
?️ Homes For Sale in Phoenix AZ
Below are Homes that have come on the market in the last 7 Days around the Median price range. Also below the pictures, you will see a Chart of all the Phoenix homes by price and Type: Below are all the homes available in the city of Phoenix by Dollar amount and type:
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