If you’re a homeowner in Phoenix or planning to become one, I’m going to be sharing an update on the latest real estate market trends as of July 26,2023.
As of July 26th, 2023, the Phoenix real estate market had 1.8 months of supply available, indicating a firmly established seller’s market. The months of supply metric reveals the estimated time it would take to sell all the homes currently listed on the market, based on the average sales volume. In general, 4-6 months of inventory suggests a balanced market, while less than 4 months indicates limited inventory, potentially leading to higher prices. On the other hand, more than 6 months of supply means a surplus of properties for buyers to choose from, which could drive prices down. Comparing the current figure to last month’s data, the months of supply have increased from 1.6 months, suggesting a slight uptick in available inventory. However, despite this increase, the market still favors sellers, indicating continued demand and potential for competitive pricing.
In the Metro Phoenix area, the average home price has reached $556,787. However, it’s essential to note that this figure represents the average across all cities within the Phoenix Metro Area. Compared to July 2022, where the average price stood at $554,811, there has been a gradual increase in prices over the past year. This upward trend is likely attributed to the persistent low inventory levels observed in the market. With limited housing supply, the demand for homes remains strong, leading to ongoing price appreciation.
As of the current date in July, the average list to sale price ratio in the Phoenix real estate market stands at 98.25%. This ratio indicates that, on average, properties are selling for approximately 98.25% of their listed price, just slightly below the asking price. This shows that sellers who price their homes appropriately are experiencing success in the market, as they are getting very close to achieving their list price.
Compared to the previous month, there has been slight increase in the average list to sale price ratio, which was at 97.91%.
However, when compared to the same period last year, the current ratio is slightly lower, indicating that properties were selling slightly closer to their list prices last year. Despite this small decline, the market still shows promising results for sellers who price their homes accurately, as they are achieving competitive offers and successful sales transactions.
You might be curious about the average time it takes for properties to sell in Phoenix. In July, properties are taking approximately 61 days, on average, to sell. This is a slight improvement compared to last month, where it took around 65 days, but notably longer than last year’s average of 32 days.
If you are planning to sell your home, it’s essential to be aware that the selling process is currently taking longer than in previous years. However, there are positive signs of things picking up pace. It remains to be seen whether this trend is driven by market factors or is merely a seasonal effect. Time will provide more clarity on this matter. As the real estate market continues to evolve, keeping an eye on trends and consulting with real estate professionals can help you make informed decisions regarding your property sale.
If you are considering buying real estate in the near future, it’s essential to be aware of the current mortgage rates. On average, the 30-year fixed-rate mortgage stands at 6.98%, which is slightly higher than the previous week’s rate of 6.88%.
However, it’s important to note that mortgage rates can vary based on various factors, including your financial situation, credit score, and the lender you choose. To get the most accurate and personalized information regarding mortgage rates for your specific circumstances, it is highly recommended to speak with a qualified lender. They can provide you with up-to-date rates and help you explore various financing options available, ensuring you make well-informed decisions when purchasing real estate.
Despite a slight increase in months of supply, the Phoenix real estate market remains relatively tight, indicating a continued seller’s market. The average home is still selling for a considerable price, with the average list to sale ratio continuing to rise. Homes are also selling faster compared to last year, suggesting sustained buyer demand.
However, one notable change is the drop in the monthly average price per square foot for closed listings over the past four weeks. This might indicate a potential cooling in the market, but it’s essential to keep an eye on this trend in the coming months to understand its implications fully.
On the other hand, the average price per square foot for listings under contract is still showing a rising trend, albeit at a slower pace. This could indicate that sellers are still commanding competitive prices, even with the slight market cooling.
Mortgage rates have trended upwards, reaching 6%-8%, impacting affordability for some buyers. Nevertheless, these rates are still historically low, which may continue to attract buyers interested in investing in the real estate market.
The Cromford® Market Index confirms that it is still a seller’s market, although it is no longer increasing. This means that while there is strong competition among buyers, it may not be as intense as before. The current market situation is favorable for sellers who need or want to sell due to the overall lack of inventory.
For buyers looking to purchase, despite slightly higher mortgage rates, real estate investment is still considered a wise decision. The market might be competitive, but historically low interest rates and potential property appreciation make it an attractive option for long-term investment.
Overall, the Phoenix real estate market remains dynamic and subject to changes, and it is advisable for both buyers and sellers to consult with real estate professionals to navigate these conditions effectively.
