Each month, the Cromford® Report, a regional real estate data and analytics source, releases real estate insights for the Phoenix Metro area.
Here is key data we have compiled from the May 2022 Cromford® Report for our homebuyers and homesellers:
Housing supply has increased by just over 40% compared to this month last year. This gain has come in just the past six weeks.
In comparison, last month (April 2022), active listings were only up 16% year-over-year.
At the time this month’s Cromford Report was released, the active listing count is 7,157 which is still 72% below the average for this time of year in the Phoenix Metro area.
The number of current homes listed between $400K-$500K have increased 35% in just 3 weeks.
The amount of homes listed $500K-$1M are up 99% in 6 weeks.
Current inventory with listing prices between $1M-$1.5M is up 54%, also within 6 weeks.
However, properties listed below $400K are still selling quickly and declining in supply.
Breaking Down the Data
Rising inventory should not be attributed to the amount of homes being listed.
Instead, the reason inventory is rising is because the increase in mortgage rates have reduced the number of accepted contracts.
Final Thoughts for Homebuyers
Based on historical data on mortgage rates, it seems rates should reduce in the next few years.
This prediction, paired with the appreciation in home prices and monthly principal reductions, should shine a light for you if you’re buying a home today. This combination may provide you an opportunity to refinance and reduce your payments considerably down the road.
Sellers’ Market Status
Based on data, it appears the selling market is on the verge of taking a downward turn to becoming a little less of the frenzy we see now.
Currently, homes sell in days, not weeks, and buyers are waiving appraisal contingencies. This could all change and return to a “normal” sellers’ market when sellers begin to reduce prices on homes.
Because the housing inventory has increased in the last six weeks and the buyer pool has decreased, the amount of sellers reducing their listing prices has increased. Therefore, the possibility of the beginning of a less frenetic sellers’ market is on the horizon.
Listing Prices / Listing Price Drops
Listings between $400K-$500K have seen a 103% increase, with the median price drop at $13,000.
Price drops in $500K-$800K range increased 157%, with median drops between $16,000 and $20,000.
Drops in the $800K-1.5M range increased 125%, with a median drop between $25,000 to $50,000
Breaking Down the Data
By reducing your listing price, data has shown us that it has been an effective way to maintain the time from listing to contract to about seven days.
However, the rising housing inventory may prove to keep homes on the market longer allowing buyers with more choices to strengthen their bargaining power.
Final Thoughts for Homesellers
Though prices will likely continue to rise, the market is changing quickly overall.
If you’re considering selling while the market is at its most favorable for you, now may be that time.
Source: Michael Orr, The Cromford Report, May 2022
May 2022 Phoenix Metro Housing Market Infographic
About the Cromford Report
The Cromford® Report provides detailed information to track the history and current status of the Greater Phoenix residential resale market and offers unique insight into its future direction.
Updated daily and usually published online within a few hours, the Cromford Report is for anyone interested in the state of the market and how it affects their investments and livelihood. Our goal is to present data that is timely, informative and easy to understand - data not available anywhere else in this level of detail or immediacy.
The data used to create the Cromford® Report is obtained from public records and obtained under license from the Arizona Regional Multiple Listing Service, Inc (ARMLS). Cromford Associates LLC and ARMLS expressly disclaim and make no representations or warranties of any kind, whether express, implied or statutory, as to the accuracy of the data used or the merchantability or fitness for any particular purpose.