Monday, June 30, 2025

Going to be a rough summer...

 Arizona Real Estate Market Update – Summer 2025

Arizona's housing market continues its steady shift in favor of buyers as we close out the second quarter of 2025. The Cromford® Market Index dropped another 2.7% on average across the 17 largest cities—mirroring last week’s decline. Only Paradise Valley showed improvement, primarily due to seasonal listing cancellations. The rest of the Valley is experiencing mild downward pressure, with Buckeye, Fountain Hills, and Phoenix seeing the steepest drops.

Despite the softening market, we are not heading toward a crash. Most homeowners remain reluctant to give up their low mortgage rates, keeping new inventory at a trickle. Prices, however, are trending downward—active listing prices fell 2.4% this past month, while the median sales price edged down from $451,000 to $449,500. With the third quarter historically being the weakest for home values, we expect further softening through the end of summer.

Importantly, investors are watching closely. Once prices fall to levels that produce desirable rental returns, expect institutional and private investor activity to kick in—creating a price floor that will likely prevent a full market collapse.

This is not a panic moment—it’s a market reset. Sellers who want to succeed must work with professionals who understand hyper-local dynamics. Broad trends are useful, but success will come from knowing the specific comps, competition, and pricing in your immediate neighborhood.

We’ve entered a new cycle. Smart strategies and local expertise will define the winners in this next chapter.



Thursday, May 15, 2025

Market Update

 📉 Market Shift Underway? May 2025 Cromford® Market Index Update

The latest data from the Cromford® Report shows a noticeable cooling trend in nearly every major Valley market. The Cromford Market Index (CMI)—which measures the balance between supply and demand (100 = balanced market)—has dropped across 14 of 17 cities compared to last month.

🔻 Biggest Declines:

  • Chandler: down 13%

  • Gilbert & Tempe: down 11%

  • Scottsdale: down 10%

This will continue to worsen through the summer.  If the herd mentality and media jump on board you'll see two major things happen much quicker than these stats can keep up with.

1) Buyers will not want to be the one to catch the falling knife (buy now when prices are going down)

2) Sellers will rush to list to try to sell before prices drop.

This is a self fulfilling action on both parts and not a great trend.

Where Buyers Are Gaining Ground:

  • Maricopa (+7%), Buckeye (+6%), and Queen Creek (+1%) are softening the least—or even strengthening—suggesting emerging affordability and potential opportunity.

As a more conservative advisor, I don’t push selling unless it makes sense for your specific life or investment goals. That said, strategic purchases right now—especially in softening submarkets—may set up buyers for long-term upside as inventory adjusts and rates remain volatile.



Overpricing...Not a good strategy

 "Let's start high...we can always come down!"  I hear this on almost every sale.  In some markets...sure.  This one, not so much.  Here is a breakdown of what the impact can be. 

Getty Images/ Albany Times Union/Hearst Newspapers / Contributor.

Home sellers with unrealistic price expectations are setting themselves up for pain in a softening market that increasingly favors buyers, warn housing market experts.

Nationally, the share of home listings with price reductions hit another multiyear high in April, indicating that sellers are increasingly overestimating what their house will fetch in the current market.

Although the problem is deepest in the South and West, nearly every state has seen an uptick in price reductions compared with a year ago, according to Realtor.com® data, signaling a widespread trend.

Despite these warning signs, seller confidence remains staggeringly high, with 81% of potential home sellers predicting they would get their asking price or higher in a Realtor.com survey conducted in March.

"The rising share of price reductions suggests that a lot of sellers are anchored to prices that aren't realistic in today's housing market," says Realtor.com Chief Economist Danielle Hale. “Today's sellers would be wise to listen to feedback they are getting from the market.”

Price cuts.jpg

Listing agents say they hear unrealistic price expectations most frequently from sellers who bought their homes during the frenzy of the COVID-19 pandemic-era housing boom, when bidding wars were common.

While market conditions have changed, most of those sellers likely have healthy equity following a surge in home prices, and will still turn a healthy profit on a sale even if they don’t achieve the price of their dreams.

“Even after setting a more grounded price, they are likely to walk away from a sale with good money in their pocket," says Hale.

Adjusting to market realities

For home sellers accustomed to the soaring home values of the pandemic-era housing boom, the new reality of flat or softening prices and weak demand can be a bitter pill to swallow.

However, overpricing your home based on a gut feeling or wishful thinking can be a dire mistake, says Toni Zarghami, co-founder and director of business development at Zarghami Group, a Keller Williams real estate firm in Sarasota, FL.

Zarghami, a listing specialist, says she frequently encounters sellers who mistakenly believe that routine cosmetic updates such as fresh paint or new molding will command a significant price premium over other homes in the area.

“They very much think that their property is better than everyone else's,” she says. “On HGTV, when you landscape and paint, and add new light fixtures, you just added 20 grand to your list, right? But that's just not the way that our market is.”

Zarghami says that in the current market, cosmetic updates can help a home sell faster, but they are unlikely to raise the sales price, unlike value-adding features such as a pool or lakefront location.

The listing agent says she works closely with sellers to set a realistic price at the outset, and isn’t averse to turning down clients who won’t budge on a price target that is out of reach.

"Selling a house is like running a marathon, and when you choose to price too high, you have let every other runner get 20 miles ahead of you before you even take your first step,” she says. “It's almost impossible to catch up."

The curse of a 'stale listing'

For sellers who price unrealistically, the consequence is often a listing that grows “stale,” lingering on the market for an unusually long time despite multiple price reductions.

Stale listings can raise red flags for buyers, who might fear that there is something wrong with the home. And the number of stale listings is increasing.

Nationally, homes typically spent 50 days on the market last month, four more than a year ago and the longest median time on the market for the month of April since 2020.

“If you overprice your home, it's going to sit on the market, and it's going to get stale, and then you're going to be chasing the price down to what the market's willing to pay for it," says Brian Stephens, a real estate agent in Lakeland, FL, and team leader with eXp Realty. “In some cases, if they're just being unrealistic, I would just walk away from the listing.”

On the real estate forums of Reddit, laments increasingly abound from home sellers who have seen their listings grow stale due to overpricing 

“I’m a seller who overpriced my home and learned the hard way,” wrote one Reddit user this week, after getting no offers since listing their home in October. “It's fully remodeled, and I originally priced it way too high—about $100K above breakeven—because I had unrealistic expectations.”

Another wrote to express frustration that their spouse dismissed the pricing recommendations of three real estate agents, insisting that their home was worth at least 25% more.

“I'm totally exasperated with the situation and just want the house sold,” the person wrote. “I feel like I can't talk any sense into my husband about this topic.”

___________________________sourced from Realtor.org - here's the direct link:


Friday, April 18, 2025

This could get much worst moving forward....

 The table is still showing a swing in favor of buyers. Like last week, we have 12 cities that have deteriorated for sellers over the last month and 5 that have improved. Avondale is the only city with a high percentage improvement of 10%, while Buckeye improved 6% and Glendale and Surprise managed another 4%. At the bottom of the table, Maricopa gave sellers a modest gain of 3%, but remains strongly favorable to buyers.

All the other cities moved in favor of buyers, with Tempe, Cave Creek, Scottsdale, Gilbert and Peoria the front runners in that trend.

The average change in CMI over the past month is -2.7% while last week we saw -2.9%. This continues the slow decelerating trend that started a week ago, but represents a very small change, largely thanks to demand holding slightly firmer. Supply continues to barrel higher, something it should not normally be doing in April. If it increases in April, then it is likely to increase further during the second half of the year, unless conditions change drastically. If conditions stay on their current track, sellers will have even more of a challenge in the second half of 2025 as each seller will be competing with too many other sellers who are equally anxious to attract a firm offer. Price cuts and concessions are going to hit new highs under these circumstances.

We have 7 cities that are still seller's markets, 4 that are balanced and 6 that are buyer's markets. Two cities (Chandler and Avondale) are above 120, but the other 5 seller's markets are only seller's markets by a very small margin with CMIs less than 115. Such a weak seller's market is barely different from a balanced market. In other words we have only 2 cities where seller's can feel a detectable advantage.

The overall CMI has been moving lower since the third week of January and yet sales pricing has remained strong right up to the end of the first quarter. However this overhang appears to be coming to a sudden end, as the median sales price and average price per square foot for closed listings have both plummeted in the last 2 weeks. The former is down 1.7% and the latter 2% in just 14 days. At this point in the year such a move is ominous and we fear an overall CMI under 80 means prices will have to fall further from current levels to restore balance to the market. In fact the situation feels similar to the second quarter of 2022, though then it was the iBuyers who took the worst of the punishment. iBuyers are now such a small percentage of the market that we no longer notice their influence very much.



Friday, March 21, 2025

Continued Slide QC/San Tan Getting Crushed

 Mar 21 - Here is our latest table of Cromford® Market Index values for the single-family markets in the 17 largest cities ~

cmi-2025-03-20.gif
The table is still reporting a swing in favor of buyers but the swing has stopped slowing down and is now starting to accelerate again. We have 14 cities that have deteriorated for sellers over the last month and 4 that have improved. Cave Creek dropped out from the improving group. The average change in CMI over the past month is -1.9% while last week we saw -1.5%. This ends the trend that started 4 weeks ago and starts a new one. The difference is only slight however.

The fastest decliners are Tempe and Queen Creek, which includes the large unincorporated county area known as San Tan Valley. All other decliners fell by less than 7%.

We have 9 cities that are still seller's markets, 3 that are balanced and 5 that are buyer's markets. Avondale and Glendale moved from balanced to a very weak seller's market, joining Phoenix, Tempe, Fountain Hills and Gilbert in the zone between 110 and 120. Only 3 cities are at 120 or higher, We can see that although there are 9 cities that are still technically seller's markets they are all below 141 so not strongly favoring sellers. However the 5 cities that are buyer's markets very strongly favor buyers, especially Maricopa and Buckeye.

Although we are in the peak of the buying season, supply is still outstripping demand. Confirming this view, the homebuilders are reporting slightly disappointing sales given the elevated level of incentives.

Although the slope is not steep, the direction of the market remains downhill.

Thursday, March 20, 2025

Market Shifting...but it will take time.

Market Update:

March 2025 Arizona Real Estate Market Update 📢

The Greater Phoenix housing market is shifting, with 44% more single-family detached listings available than this time last year. However, the increase in inventory varies by price range:

  • Under $350K: 📈 70% more inventory than last year
  • $350K–$600K: 📈 51% more inventory
  • $600K–$1M: 📈 38% more inventory
  • $1M–$3M: 📈 27% more inventory
  • $3M–$7.5M: 📈 21% more inventory
  • Over $7.5M: 📉 4% fewer listings than a year ago

🔥 What This Means for the Market
While inventory is rising, price declines may take longer to materialize. The reason? Higher-priced homes make up a significant portion of the market, propping up overall price metrics. Additionally, since buyer activity in the lower price ranges has slowed, fewer transactions are being recorded—delaying the statistical impact of declining values. In short, while individual sellers may feel downward pressure sooner, broader market data may take longer to reflect a shift.

🏡 For Buyers: More choices, more negotiating power, and potentially softer prices ahead.
📉 For Sellers: Pricing aggressively and preparing your home for sale is more crucial than ever.

Here is a graph of price reductions.  These are not yet recorded because they haven’t sold. Once they do the data will hit the market.  Or…they don’t sell and take it off the market and the reality of this situation stays in the dark even longer.

A red line graph with white text

AI-generated content may be incorrect.