Market Summary for the Beginning of November
Here are the basic ARMLS numbers for November 1, 2012 relative to November 1, 2011 for all areas & types:
- Active Listings (excluding AWC): 16,939 versus 19,578 last year – down 13% – but up 9% from 15,562 last month
- Active Listings (including AWC): 22,399 versus 27,063 last year – down 17% – but up 4% from 21,624 last month
- Pending Listings: 9,785 versus 10,509 last year – down 7% – but up 1% from 9,714 last month
- Monthly Sales: 7,009 versus 7,496 last year – down 6% – but up 9% from 6,440 last month
- Monthly Average Sales Price per Sq. Ft.: $103.94 versus $80.69 last year – up 29% – and up 2.5% from last month
- Monthly Median Sales Price: $150,000 versus $111,600 last year – up 34% – but unchanged from last month
The most important dynamic is the recovery of supply. We are seeing active listing counts grow faster than at the same point in 2011. The additional supply is welcome to buyers but is not spread equally over all price ranges. The ranges in which supply of single family active listings (excluding AWC) has grown above average during October are:
- 18% $600,000 to $799,999
- 17% $75,000 to $99,999
- 17% $225,000 to $274,999
- 14% $800,000 to $999,999
- 14% $100,000 to $124,999
- 13% $1,500,000 to $1,999,999
- 13% $175,000 to $199,999
- 12% $275,000 to $299,999
- 12% Over $3,000.000
- 10% $300,000 to $349,999
- 10% $50,000 to $74,999
There is not much of an obvious pattern, with examples from all over the pricing range. Only the range below $25,000 showed fewer active listings (excluding AWC) on November 1 than October 1. The lowest growth was found in the following ranges:
- 1% $1,000,000 to $1,499,999
- 3% $25,000 to $49,999
- 5% $500,000 to $599,999
- 5% $2,000,000 to $3,000,000
Geographically, the greatest growth in single family active listings (excluding AWC) over the last month has been in the following cities:
- 38% El Mirage
- 36% Gold Canyon
- 34% Sun City
- 27% Tolleson
- 25% Tonopah
- 22% Rio Verde
- 22% Wickenburg
- 21% Sun City West
- 20% Sun Lakes
- 20% Laveen
- 19% Coolidge
- 16% Arizona City
- 15% Surprise
- 14% Mesa
- 13% Scottsdale
- 13% Chandler
- 12% Litchfield Park
- 12% Maricopa
- 12% Casa Grande
- 10% Anthem
- 10% Tempe
- 10% Goodyear
Going against the trend, supply fell in Apache Junction (down 9%), Youngtown (down 9%), Desert Hills (down 9%) and New River (down 3%). The strong growth in the 55+ and snowbird-friendly areas reflects a normal seasonal pattern. All cities not mentioned grew at or below the regional average rate.
The change in price over the last 12 months remains very strong with the monthly sales average $/SF now up 29%. It has also risen 2.5% over the last month, impressive given that it also rose 3.2% in September by our most recent measurements. However the monthly median sales price remained static over the most recent month. This is because with additional supply there are now more homes selling below the median price to match the number sold over that value. This illustrates one of the weaknesses of using median sales price as a measurement tool. Right now , prices are rising but this cannot be seen by looking at the median. Conversely during the start of the recovery the median sales price rose much faster than real prices because of the precipitous drop in the number of transactions at the bottom of the market. Using the average $/SF as our main pricing measure goes a long way towards avoiding these difficulties.
At first sight it appears that October was a bit stronger than September for foreclosures. However this is NOT true. September had only 19 working days while October has 23, so we would need to see a 21% (23/19) increase in monthly counts for the underlying trends to be static. In fact Maricopa County notices fell by 3% and recorded trustee deeds grew by only 8%. When we allow for the different number of working days we calculate that the notices per day fell by 20% and the trustee deeds per day fell by 11%.
The abnormal foreclosure wave that started in the second half of 2006 is rapidly approaching the end of its life. We can see this confirmed by the number of pending foreclosures in Maricopa County which is down from over 51,000 at its peak to below 13,000. A figure of 8,000 pending foreclosures we would consider within the usual range for Maricopa County, and “back to normal”.
Despite the rising supply, we still have far fewer active listings than we would see in a normal market. Consequently, prices will continue to rise in November. However the market is becoming more balanced, and we can see this confirmed by the drop in the Cromford Market Index™ from 173.4 to 164.0 over the last month. 100 is the balanced reading so we still have some considerable way to go before demand and supply balance each other.
