Chris Tiller: Is the market slowing? Yep...but still early.

Cromford Daily Observation - The second week of October has continued the new trends started in the first week, an important signal for the market. New listings are well below last year but active listing counts have grown relatively fast. This means listings are going under contract more slowly. Closed listings are less numerous than last year too.

These all add up to a smaller market with lower activity, but not necessarily lower pricing. Demand is weakening but supply is also weak and needs to grow a lot if it is to match even a weaker demand level.

The Cromford® Market Index is still over 150 so we have a strong seller's market. However, it is falling very fast with supply increasing and demand falling. If this trend continues for a couple of months we could be well on the way back to a balanced market. Change is in the air, but it is still too soon to be certain how this will develop. It is clear that this is an important time to be watching the market carefully.

Here are a few key numbers from the first 2 weeks of October:

Measure for first 2 weeks of October	2017	2018	Change
New Listings - Greater Phoenix	4,916	4,226	down 14%
Active Listings Change - Greater Phoenix	827	871	up 5%
Closed Listings	2,845	2,646	down 7%
Pending Listings at end of period	5,786	4,973	down 14%
UCB & CCBS Listings at end of period	3,773	3,559	down 6%

All of these changes are negative for sellers, as evidenced by the short term Cromford® Market Index chart.

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It's rather startling to see that plummeting graph, but as referenced above keep in mind that a Cromford Market Index over 100 indicates a seller's market (demand exceeding supply). But also, as mentioned above, it's the pace of the trend that is definitely worth paying attention to.

Also, keep in mind, as always, that this is a broad brush. Price ranges and locations behave differently.

So this is a good time to closely monitor your markets of interest. To that end we have incredible, even proprietary tools, like Collateral Analytics, that can slice and dice down to the neighborhood level, albeit the cautionary note that when you 'chunk down' too much the lack of sufficient data makes charts schizophrenic and nearly impossible to interpret.

Beyond CA's 'bank grade' AVM the 2 charts I find most helpful are the Intelligence Reports - with it's slick, tightly packaged year-over-year comparison; and then the 5-year Forecast - something no one else has, again, with that 'bank grade' label we can attach to the data coming out of Collateral Analytics.

One chart that helps give perspective relative to price range is this one, where it's pretty easy to see the fairly direct correlation between Price and Months Supply - still evidencing a seller's market basically under $1M. Over $1M is where it's always softer given the fact the buyer pool is that 1% or so.

But then, on a national basis, we hear that the rise of the New Affluent among the millennials is and will continue to drive demand, albeit there are generational preferences that differ from the past. For example, the desire for the 'jewel box' - to live large on a smaller footprint; the trend toward more contemporary; etc: