Luxury Pulling Along the Market

The table below shows the number of ARMLS closed listings between Jan 1 and Jan 24 within Greater Phoenix, comparing 2025 with 2024:

Price Range	Closed YTD 2024	Closed YTD 2025	% Change
Below $1M	2,537	2,568	+1.2%
$1M or More	215	339	+57.7%
$5M or More	7	18	+157%
Total	2,752	2,907	+5.6

It illustrates just how much the balance of sales has tipped in favor of the high-end compared to this time last year. Overall closings in the first 24 days of January are up 5.6% but for homes that sold for $1 million or more the increase is almost 58%.

Below $1 million, closed listings are up a mere 1.2%. Million dollar homes have grown their share from less than 8% to almost 12%. This explains why the closing price measurements are looking unusually favorable this month - they are heavily skewed by the surge in luxury homes compared with last year.

Those operating in the low to mid-range should not be misled by the impact of the luxury market. Those operating in the luxury market should bear in mind that it is cyclical. Good times like this do not last forever.

___________________sourced from the Cromford Report

More detail on the $1M plus market ~

Not only has the percentage of closed transactions over $1M increased dramatically, but the relative appreciation has followed suit, most particularly in the uber high end, as shown below ~

 Cromford Daily Observation ~

However...

The above Average Price per Sq. Ft. by List Price Ranges are 'Annual Averages'.

If we look at the current month this year versus last year it's a more sobering picture ~

Why the apparent softening of prices in spite of robust activity ?

While activity is up year-over-year 11.38% as we see below ~

More Inventory ~

Year-over-year Active inventory is outpacing Listings Under Contract by just under 18% ~

Modest Listing Success Rate ~

The ultimate litmus test is Listings Under Contract, where 67% is a favorable number historically, it's not as robust as the 2nd half of 2020 - 1st half of 2022 (before the rate hikes) ~

Takeaways ~

• When it comes to the $1M plus price ranges things are looking up - Over $1M Listings Under Contract are up 11.4, while under $1M Listings Under Contract are actually down -7.3%!
• That said, the disproportionate increase in inventory relative to sales activity, while *44% less than the under $1M market, tells us that for the most successful outcomes, sellers must be competitively positioned accordingly.
• *Under $1M Footnote: By contrast and for reference - the under $1M market has a year-over-year increase in Active inventory of almost 32% versus the 18% year-over-year increase in Active inventory over $1M.