Market Summary for the Beginning of May from The Cromford Report
April was a stellar month for re-sale transactions, especially in the light of the weak supply. It was not very impressive for new home transactions completed.
Here are the basic ARMLS numbers for May 1, 2013 relative to May 1, 2012 for all areas & types:
- Active Listings (excluding UCB): 15,482 versus 13,117 last year – up 18.0% – but down 5.7% from 16,415 last month
- Active Listings (including UCB): 19,847 versus 20,781 last year – down 4.5% – and down 4.0% from 20,670 last month
- Pending Listings: 10,888 versus 11,996 last year – down 9.8% – but up 2.2% from 10,658 last month
- Monthly Sales: 8,649 versus 8,302 last year – up 7.4% – and up 4.7% from 8,260 last month
- Monthly Average Sales Price per Sq. Ft.: $116.66 versus $96.50 last year – up 21% – and up 3.0% from last month
- Monthly Median Sales Price: $172,000 versus $137,000 last year – up 25.5% – and up 3.0% from last month
This April was the strongest month for sales since March 2012, with 8,542 sales in Greater Phoenix (107 out of territory). Of these
- 220 were HUD sales
- 737 were REO sales
- 1,175 were short sales
- 6,410 were normal sales
That is the largest number of normal sales in a month since June 2006 at the height of the housing bubble. This is also the first time we have seen year over year growth in the total monthly sales rate since February 2012. At last the annual sales rate has stopped falling and because of the higher monthly sales rate we now have 2.3 months of supply, including UCB listings. If we exclude those UCB listings we have only 1.8 months of supply. That a scary low number but it was even lower last year (1.4 months).
The average days on market for monthly sales is down to 70 days from 86 last year. However the average days on market for active listings is still 117, which suggests that the inventory of active listings is well picked over and contains a lot of homes that are undesirable or over-priced. Attractive homes at realistic prices are few and far between and last only a few days before they go under contract.
If we look at recorded deeds at the Maricopa County Recorder we see 8,310 re-sales (excluding Trustee Deeds). We also see only 722 new home sales which is lower than any month since July 2012. The new home median sales price has risen from $232,666 to $279,310 since then, which may have something to do with the low sales number. There is plenty of pent-up demand for new homes, but a lot of prospective buyers cannot qualify and/or cannot raise the required down-payment at the higher price levels.
Overall supply is still weak and getting weaker as the spring season progresses, but the situation is not deteriorating as fast as it did this time last year. The number of new listings being added is slightly higher than last year but it is not enough to replace listings going under contract or getting cancelled or expired.
The appreciation rate has dropped to 21% because prices were rising so fast this time last year. It is unlikely that they will be able to rise so fast this year, but prices will continue to rise at a strong pace over the near term, at least until we hit the summer months. We saw a 3% rise during April, equivalent to what we should expect to see in a whole year under normal conditions. It should not surprise anyone if prices continue to rise at 2 to 3% per month until we get to the end of June.
The rate of foreclosure notices and trustee deeds is drifting gradually lower. There is nothing of great interest to report in the world of foreclosures as they are close to getting back to normal now. The Market Distress index is down to 22.7 from 44.0 last year and 59.8 in 2011. Distressed homes are no longer having much of an impact on the market.
