Market Summary for the Beginning of October 2014
The flow of new listings has remained very low and yet the weakness in demand is sufficient to cause active listings to rise. In the last four weeks we saw 10.2% fewer new listings than last year and 7.9% fewer than in 2012.
There is still no significant sign of an improvement in demand, although comparisons with 2013 are much easier now because the slump in demand started in August 2013.
Here are the basic ARMLS numbers for October 1, 2014 relative to October 1, 2013 for all areas & types:
Active Listings (excluding UCB): 23,514 versus 20,215 last year – up 16.3% – and up 0.9% from 23,296 last month
Active Listings (including UCB): 26,336 versus 23,151 last year – up 13.8% – and up 0.7% compared with 26,142 last month
Pending Listings: 5,481 versus 6,576 last year – down 16.7% – and down 7.9% from 5,951 last month
Under Contract Listings (including Pending & UCB): 8,303 versus 9,512 last year – down 12.7% – and down 6.6% from 8,797 last month
Monthly Sales: 6,277 versus 6,300 last year – down 0.4% – and down 3.0% from 6,471 last month
Monthly Average Sales Price per Sq. Ft.: $126.68 versus $120.25 last year – up 5.3% – and up 0.4% from $126.14 last month
Monthly Median Sales Price: $194,000 versus $185,000 last year – up 4.9% – but down 1.5% from $197,000 last month
Active listings (excluding UCB) rose 11.2% between September 1 and October 1 in 2013 but rose by only 0.9% in the same period this year.
Avondale and El Mirage are showing some promising signs, but across much of the valley the market is now deteriorating for sellers. Very high end luxury homes continue to sell well. Across Greater Phoenix in September we saw 19 closed sales of homes priced over $2,000,000, up from 15 in September 2013.
Last month we expected to be in a very neutral market with demand and supply in almost exact balance. Although we saw a little improvement it was smaller than we expected and the trend turned a little more negative for sellers in the last two weeks.
Sales in September 2013 were unusually weak and at the time we blamed it on the government shutdown. Sales in September 2014 were slightly weaker than last year which reflects the lack of financing available to ordinary homeowners. Tight lending standards, especially for first time home buyers seem to be having a major negative effect on demand. If Ben Bernanke cannot successfully refinance his home based on current lending rules, what hope do the rest of us have?