Even Covid-19 Couldn't Keep Phoenix Home Price Gains Down

The asking prices for active listings appeared to take a steep dive in March and April, only to recover again in May. Those who do not inspect real estate data too carefully may jump to the conclusion that this was a buying opportunity that has now gone away. In fact the chart is not dissimilar to the S&P 500 stock price index for the same period. However most of that dip was due to the cancellation of many high-end listings by sellers who did not want people viewing their homes during the pandemic. If we filter the listings to show only those priced under $500,000 we see the following instead: Of course the $/SF numbers all get lower because we are only looking at homes under $500,000. We c

Pandemic Effect: Closed MLS Sales Down 31% Look Who’s Back: Weekly Contracts Up 40% in 4 Weeks

For Buyers: Greater Phoenix contract activity dropped 39% over the course of 6 weeks between March and mid-April. The effects of those declines are now being reported over a month later as a 31% decline in closed sales. This is not surprising, you can’t close what was never opened. But that’s already old news, what is not getting reported yet is the 40% increase in accepted contracts over the past 4 weeks. This is key information for buyers right now, especially if they’re on the fence waiting for the market to “crash”. This 4-week increase in buyer demand will not be widely reported for 6 more weeks because these contracts still need to close. One mistake approved buyers make is waiti

27% Drop in Closed Listings

The ARMLS database shows a 27% fall in closed listings for April compared with April 2019. This is for all dwelling types across Greater Phoenix. If we segment the market we can see how different segments fell by different amounts: We can see that mobile and manufactured homes were barely affected, as were sales between $400K and $600K. The biggest fall was for homes under $250K. These had been in decline for some time because of the extreme shortage of supply at this price level.

7% Decline in Listing Under Contract in April

Among single-family listings there has been a 7% decline in listings under contract between April 1 and May 1. This is the opposite of last year when we saw a 7% increase. Obviously the difference between this year and last year was primarily caused by the COVID-19 pandemic. However we can see that it did not affect all price ranges equally: The price range under $225K was little affected, being constrained by the lack of supply anyway. The lower mid-range from $225K to $350K did relatively well with almost no decline in 2020. After $350K things get a lot worse. The upper mid-range from $350K to $600K was booming last year with listings under contract gaining a massive 14% during April. This

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