Troy Peterson - Thomas Title, 4800 N Scottsdale Road, Suite 4300, Scottsdale, AZ (2026)

10/09/2024

🏡🌵 My monthly Phoenix market assessment...
🛑 THE BOTTOM LINE:
We are now seeing a few data points that are showing an increase in transactional velocity!
The best leading indicator is new contracts, and for the last 6 weeks there have been more new contracts accepted than last year, and for the past 2 weeks there have been more new contracts than '22.
For the last 4 weeks there are more listings under contract than the same time last year.
Year over year increase in listings under contract for the last week of September was the highest since May '21.

FOR THE CONSUMER
🏠Is it a good time to buy? Yes! Many of the sub-markets within Phoenix are actually a buyer market and for a season (probably through the end of the year) you have negotiating power. Additionally, interest rates have improved from a few months ago.

🏠Is it a good time to sell? The "lock-in effect" is getting less relevant as interest rates decline. Yes, most people are still only selling if they need to, but more new listings are coming to market as more homeowners are deciding the time is right for them. My encouragement is to always consult a trusted and experienced Realtor, as they will provide local market knowledge and the supporting data.

Overall, the metrics of the market remain stable and healthy.
🔑KEY MARKET FACTORS
🔹NEW CONTRACT ACTIVITY: As noted above, this is very positive news and hopefully a trend that continues!
🔹SALES PRICES: Given the continued macro-economic headwinds, a 1% YOY increase is acceptable.
🔹AVAILABLE HOMES: Inventory still shows a significant increase over the previous year as demand has softened, and new listings have outpaced the previous 2 years in recent weeks.
🔹SELLER CONCESSIONS: This remains very high at 50% with sellers contributing an average of $10,000 at the closing table.
🔹DAYS ON MARKET: With lesser buyer demand, it has pushed up the amount of time it takes to sell.
🔹SALES ACTIVITY: This is a lagging indicator of the velocity of the market, but in less negative than previous months. It's possible that we might see a positive number for October.
🔹OVERALL BALANCED MARKET: The Cromford Market Index (a leading indicator of our market condition), has continued to slowly drop in the last several weeks and sits at 94, which is technically still a Balanced Market (between 90-110), though very close to a Buyer Market. Currently, there are 8 cities around the Valley in the Seller category, 4 that are Balanced and 5 that are a Buyer market.

09/11/2024

🏡🌵 My monthly Phoenix market assessment...
🛑 THE BOTTOM LINE:
It's interesting that new listings have outpaced last year, but the buyer demand is still below last year. This tells me that in part sellers are now more willing to relinquish their low existing mortgage rate, but buyers are not yet convinced and/or able to afford to hop into the market. Eventually many of those sellers will also become buyers, but that will take some time to materialize. Something worth pointing out however, for the first time this year we have 2 consecutive weeks where the amount of new contracts was higher than last year. I think all of this points to a pending thawing of this frozen cycle we've been experiencing, just still slow going currently.

And the uncertainty of a pending presidential election is clearly not helping consumer confidence.

For the consumer:

🏠Is it a good time to buy? I think so. And in some sub-markets the negotiating power has shifted recently in buyer's favor. Prices in Phoenix softened a bit throughout the summer, but now we're seeing price growth again already. I continue to think that the window of a buyer market will start to close in the next month or two.

🏠Is it a good time to sell? There is always local and situational nuance that needs to be considered, but if you need to, then you need to. Homes are taking longer to sell than last year at this time, but if priced correctly will close. Inventory is rising again, so there is competition for the buyers that are out looking, so you need to position your property accordingly. Always consult a trusted and experienced Realtor, as they will provide local market knowledge and data.

Overall, the metrics of the market remain stable and healthy.
🔑KEY MARKET FACTORS
🔹NEW CONTRACT ACTIVITY: For the first time this year, we just had 2 consecutive weeks with more new contracts than in '23. This is great news!! And hopefully the sign towards the future, as this metric will be the first one to tell us if we are coming out of the bottom.
🔹SALES PRICES: Given the macro-economic headwinds, a 2.5% YOY increase is a good sign.
🔹AVAILABLE HOMES: Inventory still shows a significant increase over the previous year as demand has softened, but continues to be mostly flat over the past 8 months.
🔹SELLER CONCESSIONS: Once again we hit a 15-year high. 56% of all sellers contributed to closing costs at an average of $10,000. Seller's need to anticipate this "expense" as it relates to their net proceeds.
🔹DAYS ON MARKET: With lesser buyer demand, it has pushed up the amount of time it takes to sell.
🔹SALES ACTIVITY: This is a lagging indicator of the velocity of the market, but continues to show that for those in the industry who count on transactions we're still awaiting the good news.
🔹OVERALL BALANCED MARKET: The Cromford Market Index (a leading indicator of our market condition), has dropped a bit in the last couple weeks and sits at 98, which is a Balanced Market (between 90-110). There remains however a big disparity among the cities around the Valley with 9 major cities in the Seller category, 3 that are Balanced and 5 that are a Buyer market.

08/12/2024

🏡🌵 My monthly Phoenix market assessment...
🛑 THE BOTTOM LINE:
Is it possible that we have reached the bottom of transaction volume? I think we might be poised to see a slight turn for the better. It will take a few months to know, but with the recent reduction in mortgage rates, we know that will at least stimulate some amount of buyer interest. Also, the amount of new contracts has been getting closer to last year, and one week ago we actually had slightly more than last year. That said, the uncertainly in the overall economy (and coming election), could cause people to keep pushing the pause button. Time will tell.

For the consumer:

Is it a good time to buy? I think so. Prices in Phoenix typically soften in the summer. And inventory is still up from the previous year, but I think the window of a buyer market will start to close in the next month or two.

Is it a good time to sell? If you need to, then you need to. Homes will sell as long as they are priced correctly. But if your property is in a buyer market area and you can wait a few months, I think things could move into your favor. That's just my two cents, but you should consult a Realtor as there are always localized nuances.

Overall, the metrics of the market remain stable and healthy.
🔑KEY MARKET FACTORS
🔹SALES PRICES: Historically prices flatten or decline in the summer months in Phoenix, and though the average sale price was below that of June, it's still slightly above the previous year even with the larger macro-economic headwinds.
🔹AVAILABLE HOMES: Inventory shows a significant increase over the previous year as demand has softened and more sellers decided to enter the market, but has remained mostly flat over the past 7 months.
🔹SELLER CONCESSIONS: This is at a 15-year high. 53% of all sellers contributed to closing costs at an average of $10,000.
🔹NEW CONTRACT ACTIVITY: This is still below last year, but continues to close the gap and in one recent week actually was above last year! This would be the first sign if we are turning the corner on more activity.
🔹PRICE REDUCTIONS: It's worth noting that from Jan-June price reductions of listings were on the rise and increased to levels we haven't seen since the big correction in '22.
🔹DAYS ON MARKET: With lesser buyer demand, it has pushed up the amount of time it takes to sell.
🔹SALES ACTIVITY: Though we continue to hover around 15-year lows, sales in the month of July actually slightly outpaced the two previous years.
🔹OVERALL BALANCED MARKET: The Cromford Market Index (a leading indicator of our market condition), has continued to drop slowly over the last few months but has stabilized at 99, which is a Balanced Market (between 90-110). There remains however a big disparity among the cities around the Valley with 8 major cities in the Seller category, 4 that are Balanced and 5 that are a Buyer market.

07/11/2024

🏡🌵 My monthly Phoenix market assessment...

🛑 THE BOTTOM LINE:

Is it a good time to buy? I personally think so. As long as you can afford the interest rate, prices are unlikely to go down. We're past the price correction. And when interest rates eventually come down there is likely to be a flood of buyers that had previously been on the fence. As the CEO of Blackstone often says, we don't always wait for the "All clear" sign, which is when everyone else hops in.

Is it a good time to sell? That depends on the scenario. Probably not if you have a 3% interest rate and have to get a new one at 7%. Is there value in waiting? Maybe a little. Prices will likely increase slowly over the next months/year. But there are certainly reasons where selling now definitely make sense. Best option is to consult a Realtor.

Overall, the metrics of the market remain stable and healthy.

🔑KEY MARKET FACTORS

🔹SALES PRICES: We have seen an overall healthy home price appreciation in recent months, but lower this month at only 1%.

🔹AVAILABLE HOMES: Inventory has increased significantly over the previous year as demand has softened and more sellers decided to enter the market. With that said, there has been little change over the past 7 months, and actually a slight decrease in the most recent week, so there is no danger of oversupply.

🔹SELLER CONCESSIONS: maybe the most interesting and substantive change this month is that this metric jumped to 51% of all sellers contributing to closing costs at an average of $9,900.

🔹SALES ACTIVITY: This is the sad reality for those of us in the industry. It was the lowest amount of sales in any June in the last 15 years.

🔹NEW CONTRACT ACTIVITY: This continues to lag behind last year, but we're closing the gap. When the time comes, this will be the first indicator of renewed transactional velocity.

🔹DAYS ON MARKET: This has now settled, and though it's a lagging indicator, it can still be helpful for sellers to know what to expect when they list their home.

🔹OVERALL BALANCED MARKET: The Cromford Market Index (a leading indicator of our market condition), has continued to drop slowly over the last few months and currently sits at 101, which is a Balanced Market (between 90-110). There remains however a big disparity among the cities around the Valley with 9 major cities in the Seller category, 2 that are Balanced and 6 that are a Buyer market.

06/12/2024

🏡🌵 My Phoenix market assessment...

🛑 THE BOTTOM LINE: Overall, the market remains healthy. Inventory has increased to more "normal" levels. However, sales volume continues to be at 15 year lows as uncertainty and higher interest rates have caused people to pause. Even amidst 110 degree summer days, the great freeze continues.

With that said, the local luxury market is a different story. In fact, in May there were more sales of $1M+ homes than any month previously!

There is a big disparity between the cities within the Phoenix metro as to who has the greater negotiating leverage, but in general the market has shifted towards the buyers favor in the last 4 months.

Major central banks around the world have begun to cut interest rates. As an example, the Bank of Canada reduced its rate from 5.00% to 4.75%, its first cut in four years. Will the US Fed follow suit? Most don't think they will yet, but maybe it's within sight?

It's not a matter of if, but when. Things will open up and transactional activity will resume.

🔑Key Market Factors

🔹SALES PRICES: We continue to see a very healthy home price appreciation at 4%. This might be a good time to point out that in my opinion the Median sales price provides a much better picture of the overall market, where the average sales price can be skewed by the ultra-luxury home sales.

🔹AVAILABLE HOMES: Inventory has increased pretty significantly over the past year as demand has softened and more sellers have decided to enter the market. That said, we certainly aren't flooded with listings and are still under historic "norms".

🔹SALES ACTIVITY: This is the sad part about this report for those of my friends in the industry. Outside of 2020 when we were at the height of the shock and uncertainty of the COVID pandemic, this year was the lowest amount of sales in the month of May in the last 15 years.

🔹NEW CONTRACT ACTIVITY: This continues to lag behind last year, BUT just in the past week there was the biggest uptick this year. Wouldn't that be a welcomed sign if this became a trend?!?

🔹SELLER CONCESSIONS: interestingly, this still remains high and actually increased to 47% of all sellers contributing to closing costs at an average of $9,450.

🔹DAYS ON MARKET: This continues to decrease as homes are selling quicker, but mostly still very normal to the long-term average rate. This is a lagging indicator, yet helpful for sellers to know what to expect in general.

🔹OVERALL BALANCED MARKET: The Cromford Market Index (a leading indicator of our market condition), has continued to drop slowly over the last few months and currently sits at 105 and is now officially a Balanced Market (between 90-110). There remains however a big disparity among the cities around the Valley with 11 major cities in the Seller category, 3 that are Balanced and 3 that are a Buyer market.

05/08/2024

🏡🌵My Phoenix market assessment for this month...

🛑 THE BOTTOM LINE: As the market has stabilized over the past few months, I'm switching back to Year-over-Year analysis, which provides a better comparison as to how the market is reacting and trending. The good news is that we are seeing very healthy home appreciation, a larger amount of available homes, along with a slight increase in sales activity. The primary challenge we still face is the lock in effect of "higher for longer" interest rates.

Once again, for cash buyers it's a great time to purchase before the market floods with more demand. And for those who are able to manage a higher interest rate, the same logic applies to the minimal competition currently.

🔑Key Market Factors

🔹SALES PRICES: Within the next 2-3 months we will potentially have fully recovered from the home value correction of '22. The peak was $480k in May '22, with the bottom at $415k in Dec '22. For the current month of May the median price is up to $470k.

🔹AVAILABLE HOMES: Inventory has increased pretty significantly over the past year as demand has softened while more sellers have decided to enter the market.

🔹SALES ACTIVITY: This is the largest year over year increase we've seen since June of '21, so this is a welcomed stat!

🔹NEW CONTRACT ACTIVITY: This still lags behind last year by about 5%. Early in the year there was optimism for reduced interest rates, which just hasn't materialized and as a result has stifled demand. The story of interest rates continues to be a dominant factor. It's now more and more likely that contract activity will remain muted throughout '24.

🔹SELLER CONCESSIONS: interestingly, this still remains high at 45% of all sellers contributing to closing costs at an average of $9,100.

🔹DAYS ON MARKET: This has shortened over the past year, but mostly still very normal to the long-term average rate. Reminder that this is a lagging indicator, but helpful for sellers to know what to expect in general.

🔹OVERALL SELLER MARKET: The Cromford Market Index (a leading indicator of our market condition), has continued to drop slowly over the last few months and currently sits at 110. It's likely that within a few weeks we will officially be a Balanced Market (between 90-110). There is however a big disparity among the cities around the Valley with 11 major cities in the Seller category, only 1 that is Balanced and 5 that are in a Buyer market.

04/11/2024

🏠🌵 My Phoenix market assessment for this month...

🔴 THE BOTTOM LINE: Broken record!!! I'm guessing we're all a bit weary of the stubbornly high interest rates, but also slowly growing accustom to the fact this is our future. Again, the overall housing market is primarily healthy, just not a time where buying and selling really makes sense for the masses. Going out on a limb, in my opinion when we see the Fed make 2 rate drops is when consumer optimism will increase and create more meaningful activity.

Yet for those who can navigate the current rates or buying with cash, now is certainly not a bad time to buy since there is less competition for the homes that are currently on the market.

C'mon Fed!!

🗝️Key Market Factors
■SALES PRICES: iincreased this month at a slow, but healthy rate of just under 1%. This makes sense as we have generally moved towards a slight seller market for the last month or two. I would expect this rate of price appreciation to continue. Year over year prices are up 7%, again very healthy.
■AVAILABLE HOMES: Inventory has mostly stayed flat. In the last month we have seen a decrease in new listings coming to market. I'm suspicious that this is directly connected to interest rates not easing like we hoped would occur.
■NEW CONTRACT ACTIVITY: For the last 5 weeks new contracts still lag behind the previous year, but only by 4% which is an improvement. The story of interest rates continues to be a dominant factor towards contract activity.
■SELLER CONCESSIONS: interestingly, this still remains high at 46% of all sellers contributing to closing costs at an average of nearly $9,300.
■DAYS ON MARKET: This has improved by 2 days, but mostly still very normal to the long-term average rate. Reminder that this is a lagging indicator.
■OVERALL SELLER MARKET: The Cromford Market Index (a leading indicator of our market condition), has dropped slightly over the last month and currently sits at 112, which puts us very close to an official Balanced Market (between 90-110). There are 10 major cities in the Phoenix Metro that are in the Seller category, 3 that are Balanced and 4 that are in a Buyer market.

03/11/2024

🏠🌵 My Phoenix market assessment for this month...

🔴 THE BOTTOM LINE: The overall housing market is frustrating for many, mostly due to high interest rates, but also very healthy in my opinion. Let me explain... there is stable price appreciation (unlike the crazy run up we had in '20-22), there is generally a balance between the amount of buyers and sellers (again unlike the all-time high sellers market from '20 -'22), and homeowners have an all-time high of available equity (unlike the short sale years of '08-'12). That said, the "higher for longer" interest rates that the Fed enacted has led to a stalemate in people choosing to move. For the most part, current sales are a result of those who must move due to changing circumstances.

For those who can stomach the current rates, now is not necessarily a bad time to buy, as there WILL be a time you can refinance... it just might be a year or two.

🗝️Key Market Factors
■SALES PRICES: increased this month at a slow, but healthy rate of 2%. This makes sense as we have generally moved towards a slight seller market for the last month or two. I would expect this rate of price appreciation to continue. Year over year prices are actually up 7%, again very healthy.
■AVAILABLE HOMES: Inventory has risen some in the early part of the year as is typical, however in the last couple weeks it has mostly flattened. We're seeing a real time change here in a reduction of new listings coming to market the past couple weeks. I'm suspicious that this is directly connected to interest rates not coming down like many hoped would occur.
■NEW CONTRACT ACTIVITY: For the first 2 months of '24, new contracts lag behind the previous year by 9%. The story of interest rates continues to be a dominant factor towards contract activity.
■SELLER CONCESSIONS: remains high at 46% of all sellers contributing to closing costs at an average of $9,420, slightly below the all-time high in December.
■DAYS ON MARKET: This has essentially been unchanged recently, and still at a very normal long-term average rate.
■OVERALL SELLER MARKET: The Cromford Market Index (a leading indicator of our market condition), has remained mostly unchanged over the last month and currently sits at 116, which is officially a Seller Market (balanced is 100). There are 10 major cities in the Phoenix Metro that are in the Seller category, 4 that are Balanced and 3 that are in a Buyer market.

02/12/2024

🏠🌵 My Phoenix market assessment for this month...

🔴 THE BOTTOM LINE: Sellers are beginning to enter the market at a faster rate since interest rates started spiking in '22, and buyer demand is increasing in most areas of Phoenix.

As to transaction volume for my friends in the business... hope is on the horizon! It might seem a ways out yet, but it's in sight. I was just listening to an investor update from Barry Sternlicht, Chairman & CEO of Starwood Capital Group, and he made this comment, "the green flag will come out when the Fed makes the first rate cut." There's uncertainty as to what month that will be, but it's coming!

🗝️Key Market Factors
■SALES PRICES: are flat month over month. This makes sense as we have mostly been in a buyer/balanced market the last 2 months. However, as things have begun thawing since the Fed said they would stop raising interest rates, buyer demand has increased, the market has shifted toward favoring sellers and I would expect pricing to begin rising slowly. Year over year prices are actually up 5%.
■AVAILABLE HOMES: Inventory has risen since last month, and new inventory is outpacing the previous year which is a great sign that more sellers are deciding to finally list their home, knowing they will walk away from that low interest rate.
■NEW CONTRACT ACTIVITY: Though contract activity is still lagging, demand continues to rise over the past month. Of the 17 major cities in the Phoenix Metro, only in Goodyear and Surprise is the demand currently decreasing.
■SELLER CONCESSIONS: This remains high at 47% of all sellers contributing to closing costs at an average of $9,775, just slightly below the all-time high in December.
■MORTGAGE RATE IMPACT: There was some initial excitement amongst buyers when the Fed said they were no longer going to hike rates. And as a result, actual mortgage rates dropped about 1%, but in the last 6 weeks they have mostly stayed flat and calmed that early enthusiasm. Rates continue to heavily impact consumer sentiment.
■DAYS ON MARKET: Homes are selling at a slower pace than the last few months, but still at a very normal long-term average rate.
■OVERALL SELLER MARKET: The Cromford Market Index (a leading indicator of our market condition), has mostly stabilized over the last month and currently sits at 118, which officially makes it a Seller Market (balanced is 100). There are 10 major cities in the Phoenix Metro that are in the Seller category, 4 that are Balanced and 3 that are in a Buyer market.

01/09/2024

🏠🌵 My Phoenix market assessment for this month...

🔴 THE BOTTOM LINE: For homeowners and interested buyers, the market has started to move back in favor of sellers. This is mostly due to a slight increase in buyer demand. Clearly the lower interest rates are beginning to have an effect on some potential buyers, as they are choosing to write offers. However, the "lock in effect" still remains pretty dominant for sellers who aren't yet convinced to leave their 3% mortgage for one over 6%, and therefore transactional velocity remains low.

For my Realtor friends, my personal opinion remains that we are in a slow crawl out from the bottom, but 6 months from now could look much different.
-Interest rates continue to improve, which will result in increased buyer demand as the year progresses
-New listings in the last 3 months outpaced the previous year, a reversal from the first 9 months of '23
-During the first 6 days of January this year, there were 9% more accepted contracts than the same days in '23.

Keep grinding my friends! Better days ahead in '24!

🗝️Key Market Factors
■SALES PRICES: are slightly down month over month, however for the 2nd month in a row the year over year comparison is positive at +4%. I think we'll likely continue to see small price appreciation throughout this year.

■AVAILABLE HOMES: Inventory has declined slightly this last month. This is mostly from an increase in demand and expired listings.

■NEW CONTRACT ACTIVITY: As mentioned in my "Bottom Line" this might be one of the more encouraging metrics this month. Demand in 12 of the 17 major cities across the Valley is seeing increase. If this continues without a corresponding increase in new listings, we'll see more buyer competition which will drive up prices.

■SELLER CONCESSIONS: For December, sellers contributed to closing costs an average of $10.000 in half of all transactions. Interestingly, this is an all time high for seller contributions. A reminder that these contracts would have been written in November, which was the peak time for buyer friendly negotiation.

■LISTING SUCCESS RATE: This is a metric not talked about much, and currently sits at 66%. As mentioned earlier, this is in large part due to an overall lethargy in the market and an increase in expired listings. Over the past 10 years the average is around 80%.

■DAYS ON MARKET: Homes are selling at a slightly slower pace than the last few months, but at a very normal long term average rate.

■OVERALL SELLER MARKET: The Cromford Market Index (a leading indicator of our market condition), has been rising the last 4 weeks and currently sits at 112 which officially makes it a Seller Market (balanced is 100). There are eight major cities in the Phoenix Metro that are in the seller category, 5 that are balanced and 4 that are in a Buyer market.

Troy Peterson - Thomas Title

10/09/2024

09/11/2024

08/12/2024

07/11/2024

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