Market Summary for the Beginning of February 2021



Here are the basics - the ARMLS numbers for February 1, 2021 compared with February 1, 2020 for all areas & types:

  • Active Listings (excluding UCB & CCBS): 5,180 versus 11,974 last year - down 56.7% - and down 14.5% from 6,055 last month

  • Active Listings (including UCB & CCBS): 9,727 versus 16,035 last year - down 39.3% - and down 0.6% compared with 9,788 last month

  • Pending Listings: 7,070 versus 5,969 last year - up 18.4% - and up 15.2% from 6,135 last month

  • Under Contract Listings (including Pending, CCBS & UCB): 11,617 versus 10,030 last year - up 15.8% - and up 17.7% from 9,868 last month

  • Monthly Sales: 7,330 versus 6,464 last year - up 13.4% - but down 26.8% from 10,015 last month

  • Monthly Average Sales Price per Sq. Ft.: $217.59 versus $182.18 last year - up 19.4% - and up 2.9% from $211.50 last month

  • Monthly Median Sales Price: $339,000 versus $289,900 last year - up 16.9% - and up 2.1% from $332,000 last month

January is usually a very good month for new listings and overall supply tends to be stronger at the beginning of February than it was at the turn of the year. However 2021 has been completely different. New listings arrived in the weakest flow we have ever recorded and although demand subsided a bit, it was more than strong enough to soak up almost everything sellers could offer. Instead of rising, supply collapsed another 14.5% during January. This does not show up if we look at active listings including UCB and CCBS, because so many agents place listings into these statuses when a contract is signed, rather than the more traditional pending status. The vast majority of these "active" listings are not really being marketed and the signed contract will quickly proceed to closure. Having a listing subject to the buyer's property selling is not so much of an issue when selling that property is easier than falling off a log.


The supply situation is the worst we have ever recorded, lower than the first quarter of 2005, which used to hold the record. When supply is this low, it starts to drag demand numbers down with it. Sales volumes are limited by the number of homes for sale. Although they are still much higher than January 2020, sales counts and under contract counts are not growing as fast as normal. This is probably due to a combination of factors: higher interest rates, lack of supply and affordability concerns. Prices rose by almost 3% over the last month, so in theory demand should decline as prices increase. We will see how true that turns out to be as prices are set for extremely high rises over the next several months. The annual appreciation rate has already surpassed 19% and could easily reach 30% by the time we are well into the second quarter.


New home builders are trying as hard as they can to create more supply, but there are many physical, financial and legal limits to how quickly they can do this. These additional homes are sure to be priced well above the current level.


There is currently no indication that supply trends will improve and at the moment it looks like supply will drop further over the next 2 months. We would not be surprised to see demand continue to trend lower, but this will have little effect on prices. We already have far more buyers than the market can support. Our best guess is that the average price per sq. ft. will continue to rise at about 2% to 3% per month for the next several months.

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TO CONTACT OUR TEAM PLEASE CALL OR EMAIL US:

CRESTMARK REALTY GROUP

RAEGEN JOHNSON

Realtor

C:  602.330.5362

O:  602.362.5484

E: Raegen@RaegenJohnsonGroup.com

SARAH HERR

Realtor

C: 602.499.3175

O: 602.362.5484

E:Sarah@RaegenJohnsonGroup.com

JULI FEINBERG

Broker

O: 480-342-8889

E: Julif@jclam.com

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