Market Slowing

No Big Gains Through the End of the Year : (

The monthly average sales price per square foot for all ARMLS areas & types is $126.41 today, once cent higher than it was on the first Saturday of January. After peaking in early April at $131.37, a gentle drift downwards has been the overall trend in this measure. In the short term we see some weakness in the pending $/SF so we anticipate the monthly sales $/SF entering the $120 to $125 range during the last 4 months of 2014. Our guess is that $/SF pricing will be a little lower in January 2015 than it was in January 2014. Not enough to cause significant appraisal problems, but enough to confirm we are no longer in a market with rising prices.

The Cromford® Market Index started to move downwards in July last year. It generally takes about 12-15 months for sales pricing to follow its lead, which is now starting to occur. The Cromford® Market Index is specifically designed to be a leading indicator while monthly average sales price per sq. ft. is very much a lagging indicator. Since the Cromford® Market Index started to rise again in March this year, the price weakness we see ahead is likely to be brief and relatively inconsequential over the longer term. Based on current trends we would expect sales pricing to start to firm up again during the spring of 2015, since that will be about 12 months after the Cromford® Market Index hit its low point and changed direction.

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If you're reading the above and wondering what the index is indicating for your particular city of interest, go to the City Snapshots posted here: http://RLSIRMarketing.com/stats

Keep in mind, an index score of under 100 favors buyers; over 100 favors sellers; 90 - 110 equals relative balance in supply and demand, which is where we are now.

Example: Snapshot of Scottsdale below (see arrow @ bottom of page pointing to the CMI):

BTW - This a pretty good improvement in the CMI for Scottsdale over the last 30 days. However, that's because, as you see below, month-over-month, we see more Active Listings than either Pending or Sales.

Ps. Green button trend good for sellers; red button trend good for buyers.