Phoenix REALTORS upbeat on Valley market trends

By: Ahwatukee Foothills News 

March housing market data suggests a stronger market is coming to the Valley, according to Phoenix realtors.

The organization of real estate professionals last week pointed to Maricopa County’s population growth last year as an indicator of “solid sales through the rest of 2023.” March residential real estate numbers also showed a “stable and slight upswing potential,” according to Phoenix realtors.

“We’re in a unique situation in Maricopa County. Nearly 200 people daily are moving into Greater Phoenix, and the inventory is still limited while demand is strong,” said Butch Leiber, president of the Phoenix realtors board of directors.

“Year-over-year housing numbers look weak, especially given the drastic shift from May to December 2022, but the trend behind the numbers is shifting upward.”

In single-family homes, new listings were down 29.9% over last year, with closed sales down 25.4% in the same period.

The average sales price dropped 6.1% to $588,444 from 12 months earlier.

Data show that while May 2022 was the peak housing sales month, January and February 2023 were at the bottom. In month-over-month data, the numbers are trending higher, the association said.

“Homes are selling for less than asking price – a change from a year ago,” said Leiber. “In March, that percentage of list price received rose to 97.9%.”

Inventory for townhomes and condominiums are down 28% compared to last year’s data, but the units selling are gaining an average premium of almost 3%.

“The trends of the last three months show that perhaps the worst is behind us and that the market is coming closer to where it should realistically be,” said Leiber.

“The last few years, Phoenix enjoyed an extraordinary run, but now we see the market normalizing. I believe we’ve seen the worst of it as we head out of the eye of the storm.”

As the number of days on the market

is trending up from 30 days in March 2022 to 75 days in March 2023, so are new listings and pending sales, which have seen a 29.7% decline and 44% decline respectively.

Closed sales have also experienced a 25.7% dip from last year.

The association also said, “The Phoenix economy is strong; more high-value jobs are entering the market, and a new population is moving in.

“In fact, most of the population growth in Maricopa County came from new population rather than organic growth, which means that the demand is likely to increase as new families move into the area.”

It noted Maricopa County was the fastest growing country in the nation last year while ranking on the lower end of other large counties for population growth from births over deaths.

According to U.S. Census Bureau annual population estimates, almost 73,000 people moved into Maricopa and Pinal counties last year.

Maricopa County saw nearly 57,000 new residents in 2022 over 2021, an increase of over 111,000 from 2020. Pinal added over 16,000 in year-over-year data and just shy of 35,000 in 2022 compared to 2020.

Almost 49,000 new residents chose Maricopa County as their new home in 2022, compared with just over 7,800 net natural population growth.

The county ranked 10th in the nation in international migration, attracting about one in three people from a foreign country to the county.

In the most recent data, 2021, the Census Bureau said Asia was the source of more new residents than Mexico and Canada combined. Net migration was almost seven times faster than organic population growth, with the number of deaths subtracted from the number of births.

The Cromford Report, a leading analyst of the Valley’s housing market, said virtually all but two indicators showed the Phoenix Metro in a stronger position than a year ago.

“Obviously, everything looks unfavorable for sellers compared to April last year, but almost everything is looking favorable compared to last month,” the Cromford Report said.

It said the two exceptions were annual sales rate and the annual appreciation rate based on the monthly average square foot prices. “These will take a long time to turn around, by their very nature,” it said.

“Compared to March 22, we see available supply is significantly lower; listings under contract are higher; sales are up sharply, but still low by normal standards; dollar volume is up; days on market are coming down; average and median pricing is up; listing success rate is up; homes are closing at a higher percentage of their final list price.”

The Cromford Report also advised, “Since all the indicators are showing the market improving for sellers, it is safe to throw out the skepticism and move on to relief.

“We have a full-on recovery taking place.”