Feb 18 - With interest rates noticeably higher than in January, there is less enthusiasm in the air from buyers. There were only 1,822 new contracts accept last week, noticeably lower than the previous 2 weeks which were all around the 2,000 mark.
On the other hand, sellers have turned down the rate of new listings arriving, so demand and supply are both weakening from the same interest rate movement.
The result is that we still see the market balance moving in favor of seller which will help support pricing. The volume of transactions will not rise as quickly as it would have if rates had stayed as low as January. We are still seeing increased closed transaction rates, as you would expect for the time of year. The listing success rate has also recovered and now stands over 70%, consistent with a healthy market.
Basically the correction in pricing has run its course and we are now back in a normal market, far less frenetic than we experience between 2020 and 2022.
Feb 16 - Here is our latest table of Cromford® Market Index values for the single-family markets in the 17 largest cities
Fountain Hills held off the strong challenged by Chandler and remains in first place, for now. The rest of the Northeast Valley is clearly deteriorating for sellers, especially Paradise Valley where supply is rising and demand falling. The rest of the Central Arizona market continued to improve for sellers over the last month. Top areas include Tempe, Glendale, Avondale, Gilbert, Queen Creek, Goodyear, Phoenix and Mesa, all locations where the CMI increased by 24% or more.
Higher mortgage rates since January are starting to slow the recovery in demand, but they are also discouraging potential sellers. The net effect is still positive, but the return to normal volumes is going to take a little longer than it appeared two weeks ago.
We still have 4 cities in a buyer's market, with 2 in balance and 11 in a seller's market.