And the violins continue...

Available supply has grown dramatically in most segments of the market since March 16, this year's low point. We had 4,367 active listings without a contract on March 16 and have 17,509 today. This is an increase of 301% across all areas & types. Within Greater Phoenix the growth has been 318% from 3,884 to 16,235.

By dwelling type we have seen supply grow at the following rates:

• Single-family Detached - up 344%
• Townhouse - up 370%
• Apartment-style - up 288%
• Gemini / Twin - up 130%
• Loft-style - up 240%
• Patio Home - up 257%
• Mobile Home - up 65%
• Modular / Manufactured - up 20%

These figures are for Greater Phoenix locations only. Out of area supply has grown 164%. It is very noticeable that mobile and manufactured homes have seen supply grow much more slowly than the rest of the market.

Largely due to a change in the mix of homes available, with low growth at the high end luxury market compared with the mid-ranges, the average advertised price of a home in Greater Phoenix is down from a peak of $1,010,002 on March 24 to just $731,744 today. The average available home size is also down from 2,430 to 2,172 sq. ft.

Here is our latest table of Cromford® Market Index values for the single-family markets in the 17 largest cities

The average monthly change in CMI was -34%. This is the same as last week and the week before. The week before that it was -35%.

The deterioration in the market for sellers continues with almost as much speed as ever. There has been a slight reduction in the rate of arrival of new listings, but it is still much higher than last year at this time. Demand has not stopped falling and listings under contract are exceptionally low for the time of year. Even our best performing city, Paradise Valley, has slumped 11% over the last month, but it may yet overtake Fountain Hills and grab the top spot, since Fountain Hills fell 18%, the second best result. Cave Creek is third and fell "only" 21%, which looks good by comparison with the other 14 cities which range from -30% (Avondale) to -44% (Glendale).

Buckeye is now a buyer's market by a large margin and Queen Creek is almost as bad for sellers. Maricopa is not quite there yet but it will be a buyer's market in 2 or 3 days. Gilbert, Tempe, Peoria, Chandler and Surprise are all going to be balanced markets within a few days and on their current trajectory they could be buyer's market by mid August. The largest market by far, Phoenix, looks like it will be balanced before the end of July and a buyer's market before the beginning of September. Glendale and Mesa are just a week or so behind.

The high end market is still holding out much better than the mid-range.

Only 3 cities are now over 150. A month ago we had 14. The market has changed dramatically for the worse over the past 4 or 5 weeks.

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Picking up on the above 'The high end market is still holding out much better than the mid-range', the positive luxury sector story you can broadcast is the inverse relationship between higher price ranges and inventory (Supply); and following suit, in the higher price ranges we see a higher percentage of year-over-year sales (Demand - Listings Under Contract) ~

Supply ~

Demand ~

 

Takeaway ~ 

Using the broad brush, inventories are clearly on the rise and accelerating relative to demand. However, the luxury sector tells a much more resilient story.

Notable distinctions:

• We see an inverse relationship between increasing inventory and prices (as prices go up the percentage of inventory increase goes down).
• Following suit, Demand in the luxury sector (defined as $1M plus) is still at or above last year, with more relative demand as you go up in price range.