May Market Update

GOOD NEWS FOR BOTH SELLERS AND BUYERS IN LATEST DATA

By AFN NEWS STAFF.
Used with permission.

Spring has brought some good news for both sellers and buyers in the Phoenix housing market, according to a leading website that monitors trends in the Valley.

In its latest daily and semi-monthly looks at the Valley housing market, the Cromford Report said recent sales and listings data show that supply of affordable homes is increasing slightly while demand also is creeping up.

“Almost all the gloomy statements you may have seen about the Phoenix housing market outside the Cromford Report have proven to be wildly overblown,” it said. “It is in good shape and, thanks to lower interest rates and higher loan limits, we are seeing demand headed back to normal.”

Looking at the rate of monthly sales, the report also said there is more supply in 2019 than in 2018, though inventory remains lower than in 2016 and 2017 and “has dropped from its peak on Feb. 1 at a faster rate than the other three years.”

“This is due to a fairly subdued rate of incoming new listings and a rapid increase in demand due to more attractive interest rates,” the report said.

Adding that “sellers should be pretty happy with the current situation,” the Cromford Report also said, “Buyers can be pleased that they have more choice than last year, at least between $200,000 and $600,000, and can lock in lower rates for the time being. “There is something for everyone to be happy about,” it said.

Realtor.com also had some good news for buyers looking for new homes. It listed Phoenix as number 5 among the 10 cities in the nation that are seeing the most home construction. Ahead of Phoenix, starting with number 1, were Dallas, Houston, New York City and Atlanta.

The 10 cities it said are “dominating new home construction” stand in sharp contrast to the country as a whole, where Realtor.com reported new home construction is slowing down.

“The country is already at its lowest point in a decade for housing affordability, due largely to the shortage of homes on the market,” Realtor.com said. “In February this year, according to U.S. Census Bureau data, 9.9 percent fewer homes than a year ago had been started but not yet completed. The lack of newly constructed homes is only exacerbating the crisis.”

But the Valley is an exception to that trend. Realtor.com said that with a median price of $337,500, new home construction is perking along, with more than 31,000 building permits issued so far this year – a 5.7 percent increase from a year ago.

“More people are moving into Phoenix than anywhere else in the nation,” the website stated. “The biggest group of these newcomers are coming from high priced Southern California and are willing to pay top dollar for newly constructed homes.”

Those California transplants generally can sell for a sizable equity and buy something bigger in Phoenix,” according to Ali Wolf, director of economic research for Meyers Research, a real estate consulting firm that specializes in new-home data.