March 8 - For the first time since we started measuring in 2006, there are fewer than 2,000 active single family rental listings on ARMLS (excluding a handful of UCBs and all vacation rentals). Since we are seeing about 2,250 signed leases a month, this represents only 25 days of supply.
The 1,988 rentals on offer average a staggering $1,971 per month, by far the highest average we have ever seen. This represents an average of 84.8 cents per sq. ft. per month. This time last year there 2,760 listings at an average of $1,598 per month or 75.5 cents per sq. ft. per month.
Two years ago there were 4,837 active listings at an average of $1,543 per month or 75.2 cents per sq. ft. per month. You can see that there was only a slight increase in asking prices between march 2013 and 2014 but a very strong increase between March 2014 and 2015.
There are only 587 active listings at or below $1,200 a month (the most sought after price range is $900 to $1,200). Since we are seeing 1,177 leases a month, this represents only 15 days supply of affordable rentals.
There are 1,387 active listings above $1,200 a month., represents 40 days of supply.
There are 548 at $2,000 a month or over, representing 94 days of supply.
Like the for-sale inventory, it is getting more and more skewed towards the high end. Affordable rentals are getting very scarce, while higher end rentals are in plentiful supply, with more being constructed every month.
This trend continues to develop and there is no sign yet of it stabilizing.
March 7 - Perhaps news of increased demand is bringing out more sellers. However the new listings that have been arriving are badly matched to the demand when we consider the variations by price range.
Demand is up strongly for the lower and middle price ranges but new supply is heavily skewed towards the higher price ranges, where demand is actually lower than last year. As a result, sellers of properties over $800,000 are facing stronger competition from other sellers. Sellers below this price point are in a much more favorable position than last year, particularly those with homes priced below $400,000..
When we look at listings added from February 7 to March 6 in 2015 and compare with the same dates in 2014, we find:
- new listings priced below $100,000 are down 30% (total value at list down 27%)
- new listings between $100,000 and $200,000 are down 16% (total value at list down 15%)
- new listings between $200,000 and $400,000 are up 1% (total value at list up 2%)
- new listings between $400,000 and $800,000 are up 6% (total value at list up 7%)
- new listings at $800,000 or more are up 13% (total value up 12%)
The surge in demand is for homes between $75,000 and $800,000, so the extra supply above $800,000 is joining inventory that is already plentiful.
Meanwhile inventory for the first time home buyer is in short supply and contract ratios for the well-located areas that are dominated by such homes are headed into "frenzy" territory.
The map below shows the ZIP codes where the Contract Ratio is over 100 (favoring sellers):
The majority of these are in the central West Valley with a few pockets in the closest parts of the Southeast Valley (particularly West Mesa)
Conversely the ZIP codes in the map below are either cold (blue) or lukewarm (green).
Here we see the areas with weak Contract Ratios are concentrated in the Northeast Valley, outer areas of Maricopa County and most of Pinal County.
March 6 - The number of active listings of single family homes has increased in some cities and fallen in others. Here is a table of the change between February 5 and March 5, excluding UCB listings. The lower the growth, the better the news is for sellers:
- Youngtown -44.4%
- Tolleson -26.1%
- Waddell -19.5%
- Wittmann - 14.9%
- Sun City -12.3%
- New River -12.0%
- Maricopa -11.4%
- Sun Lakes -10.6%
- Surprise -10.5%
- El Mirage -9.9%
- Tonopah -9.5%
- Eloy -8.9%
- Glendale -8.6%
- Apache Junction -8.5%
- Mesa -7.9%
- Buckeye -7.6%
- Phoenix -5.9%
- Avondale -5.8%
- Laveen -4.7%
- Chandler -4.5%
- Tempe -4.1%
- Peoria -3.8%
- Goodyear -3.7%
- Rio Verde -2.0%
- Arizona City -2.0%
- Carefree -1.5%
- Paradise Valley -1.5%
- Florence -1.2%
- Anthem -1.2%
- Scottsdale +0.1%
- Gold Canyon +0.3%
- Sun City West +0.8%
- Gilbert +1.2%
- Queen Creek +1.3%
- Coolidge +1.6%
- Litchfield Park +1.9%
- Fountain Hills +3.2%
- Wickenburg +3.4%
- Cave Creek +4.7%
- Casa Grande +4.8%
The top 29 cities are all showing at least some good news for sellers with the West Valley cities clearly dominant in the top 10. I am afraid there is nothing to get excited about for sellers in the bottom 11 cities.
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