Listings Under Contract Hit New Highs
Listings under contract continue to accumulate as buyers write up contracts for the diminishing supply of homes for sale.
Note how 2020 followed a very similar track to 2018 until mid-March. Contract activity fell sharply but stabilized during April and then recovered all the lost ground and more over May and June.
It is very unusual for us to see almost 14,000 listings under contract at this point in the year. It did happened between 2009 and 2013 but that was caused by the large number of short sales that stayed under contract for many months awaiting lender approval.
Like last week, all 17 cities have moved in favor of sellers over the prior month, but this time they are moving at the fastest rate we have ever witnessed.
A surge in demand coupled with an unusually weak supply of new listings is creating an almost surreal market. In many segments, buyers outnumber sellers many times over. In this environment things can get very frenetic and stressful, decision time is often very short and mistakes can result. Buying a home is one of the biggest decisions a buyer will make so it is important buyers still take time out to think carefully and not get caught up in the frenzy.
As recently as May 21, all 17 cities were moving in favor of buyers, so the change in direction has been sudden and violent. This is not normal.
The higher end of the market was lagging behind significantly, but is now joining in too. Paradise Valley's CMI is up 26% and Scottsdale's up 25% over the last month.
***Cromford Market Index™ is a value that provides a short term forecast for the balance of the market. It is derived from the trends in pending, active and sold listings compared with historical data over the previous four years. Values below 100 indicate a buyer's market, while values above 100 indicate a seller's market. A value of 100 indicates a balanced market.