The Market Officially Switches

The change from a balanced market to a buyer's market that occurred exactly one month ago has now settled in firmly and those in denial are dwindling in number.

Here are the basic ARMLS numbers for March 1, 2014 relative to March 1, 2013 for all areas & types:

• Active Listings (excluding UCB): 26,589 versus 17,090 last year - up 55.6% - and up 4.1% from 25,541 last month
• Active Listings (including UCB): 29,613 versus 21,460 last year - up 38.0% - and up 4.2% compared with 28,413 last month
• Pending Listings: 6,462 versus 10,300 last year - down 37.3% - but up 12.9% from 5,723 last month
• Under Contract Listings (including Pending & UCB): 9,486 versus 14,670 last year - down 35.3% - but up 10.4% from 8,595 last month
• Monthly Sales: 5,462 versus 6,578 last year - down 16.7% - but up 14.7% from 4,778 last month
• Monthly Average Sales Price per Sq. Ft.: $127.54 versus $111.67 last year - up 14.3% - and up 1.7% from $125.45 last month
• Monthly Median Sales Price: $180,000 versus $160,000 last year - up 12.5% - but down 1.5% from $182,700 last month

The rate of change has slowed. Supply is increasing but less quickly because contract activity is picking up, as is usual for the time of year. Sellers must hope that the number of active listings reaches a peak and starts to reduce in March. That would be normal for a quiet year. However demand remains stubbornly low compared with the normal spring level and there is, as yet, no sign of improvement for sellers except in a few isolated areas.

Sales in February were higher than January (as they are every year) but much lower than in February 2013, giving us the lowest February sales total since 2009. Pending listings have risen since the start of the year but started at such a low point that they are still at their lowest level for early March since 2008. So far this is the second weakest year for pending listings since 2000 (2008 was much weaker still). We still haven't overtaken the pending listings for 2007, which is not a reassuring comparison as 2007 was an awful year for sellers.

New listings have been arriving at a rate which is consistently 9% higher than last year, and the most positive thing we can say about demand is that it has almost stopped getting weaker. The period between March and June almost always sees a down trend in active listings so we would expect to see little movement in total active listings this year until we get to July. If current trends continue we will see another rise in active listings through the second half from July to November. With supply only slightly below normal and demand well below normal we have a classic buyer's market.

In a buyer's market, prices tend to fall, but it takes quite some time to happen as long as we are not facing a lot of distressed properties. We are not. Distress is low and pending foreclosures are continuing to trend lower.

The monthly median sales price is already starting to fall. At $180,000 for all areas & types it is lower than last month and that was lower than the month before. At the moment $180,000 looks good compared with $160,000 for February 2013. However, the median sales price for June 2013 was $182,500, so in just 4 months we are likely to be reporting a negative annual change. The average price per square foot readings are looking more positive thanks to the relative strength of the luxury market. The luxury market contributes strongly to the average price per square foot but has virtually no influence on the median sales price.

The luxury market is seeing more problems appear. Demand remains stronger than the rest of the market, thanks to the stock market making new highs and lenders falling over themselves to offer jumbo loans at very attractive rates. However supply is becoming excessive and luxury sellers are starting to see too much competition for them to be aggressive in pricing.

The big question is: why is the demand so weak?

The change since last year is much bigger than we all expected and more than just the disappearance of investors.

We don't buy interest rates as the problem. There is probably something more fundamental going on. We suspect it is generational, and we are researching into its numbers. As baby boomers become gradually less important to the market, millennials start to take their place as the most influential generation for sales volumes. Millennials are behaving quite differently from previous generations. Some of these differences are by choice and some out of necessity.

For millennials:

• their ability to qualify for mortgages is often dramatically lower because of the size of their monthly student loan debt payment - this often raises their debt to income ratio to unacceptable levels for mortgage lenders
• they already have serious delinquency problems with student loan debt (over 11% of student loans are seriously delinquent and the trend is strongly upwards), impacting their credit score
• they have seen major problems with home ownership during 2005 to 2011 and not experienced positive home appreciation adding substantially to their net worth
• they enjoy the flexibility of renting because they change jobs more frequently than earlier generations
• they do not have a very positive image of Arizona as a destination due to the negative publicity it has received in the media over the last several years
• on the whole, they appreciate urban lifestyles in dense cities and public transportation, contrary to the suburban preferences of earlier generations
• they tend to value experiences over ownership, for example they spend more on eating out than previous generations

Phoenix doesn't really have an affordability problem overall, but it has an affordability problem for millennials because on average they have less savings. lower earnings and far lower net worth than previous generations had.

Demand for homes to purchase is increasingly affected by these trends as more millennials join the workforce and more baby boomers leave it.

The typical local millennial is short of money and renting and intends to rent for a long while yet. In a recent survey 75% of millennials responded that student loan debt had affected their decision or ability to purchase a home. 43% stated that it had delayed their decision to start a family. 63% reported that it had impacted their ability to purchase a car. The size of student debt is vastly higher than for previous generations. In the past someone with a student loan was more likely to become a home buyer than average. For the millennials, attending college with a student loan has made them less likely to become a home buyer. So far the recession has meant that their investment in education has not yet paid back in earnings when employed. This is not just a problem for millennials. It is a problem for the entire economy, because there is a lack of ability to spend on the things that drive the economy, including home purchase.

The implication is that we are going to need additional affordable rental accommodation in the medium term. The existing rental supply is getting low at the same time that the for-sale supply is growing.

Cromford Market Summary for the beginning of March

___________________________________________

MikeB Comment: I'm sending this statewide because the trends and socio-economic facts and implications offered here will have statewide relevance. 

From a self-serving point of view, if the millennials are and will continue to be a drag on the housing market, then the sweet spot of mid-range (2nd home owner / move-up buyer / older / more established) buyers and sellers that are attracted to our more upscale, lifestyle-centric brand is a bit of a silver lining for RLSIR. 

At least for now. 

Not that we take comfort in the idea that a whole generation may be necessarily turning away from the value of home ownership. But again, if this is an economic reality that will re-shape our industry, then to be blunt about it, better to appeal to the have's than the have-nots! 

Or put another way, I don't know about you, but I'd rather work with buyers and sellers than tenants and landlords.

For your success,

C. Tiller

February Update : ) Market slowing....

Market Summary for the Beginning of February

The market stability and balance which prevailed between the end of November and mid January seems to be coming to an end. Both demand and supply are now rising, as is normal for the time of year. However it is the rise in supply that is having the stronger effect and this is bad news for sellers.

Sales were very low in January, giving us the lowest January sales total since 2009. Pending listings have risen sharply since the start of January but started at such an unusually low point that they are still at their lowest level for early February since 2008. In fact the weekly pending listing chart looks a lot like 2007 which is not a year we take any pleasure remembering. We expect 2014 to do better than 2007 once we get past the end of February, but at the moment the tepid demand is not making much of a dent in the rise in active listings. If we were going to have a strong spring for sellers then active listings would have peaked in mid January and be falling by now. On the positive side, the new supply is almost all non-distressed, whereas in 2007 we faced an onslaught of foreclosed homes coming to market.

New listings have been arriving at a rate which is about 9% higher than last year, so if demand remains below par we can probably expect to get back to a "normal" level of supply around 32,000 listings (including UCB) during the second half of this year. With supply normal and demand some 20% below normal we are heading towards a classic buyer's market.

This means increasing concessions from sellers and erosion of their pricing power. The monthly median sales price is already starting to look a little wobbly, both overall and in a number of specific locations including the City of Phoenix. The medians are not assisted by the relative strength in the luxury sector. However the average price per square foot is being given a significant boost by the luxury segment and although the monthly average fell between December and January, the under contract $/SF is still moving upwards.

If current trends stay in place then we expect no significant sales price rises during the first half of 2014. Indeed, if current trends stay in place through the second half of the year then pricing is likely to be lower by January 2015 as sellers compete with each other for the attention of the smaller pool of buyers. However, five months is a long time in the ever-volatile Phoenix housing market and trends may very well change by then.

Here are the basic ARMLS numbers for February 1, 2014 relative to February 1, 2013 for all areas & types:

• Active Listings (excluding UCB): 25,541 versus 17,573 last year - up 45.9% - and up 11.0% from 23,091 last month
• Active Listings (including UCB): 28,526 versus 21,757 last year - up 31.1% - and up 12.7% compared with 25,319 last month
• Pending Listings: 5,723 versus 9,523 last year - down 39.3% - but up 23.9% from 4,667 last month
• Under Contract Listings (including Pending & UCB): 8,595 versus 13,707 last year - down 36.8% - but up 25.7% from 6,895 last month
• Monthly Sales: 4,728 versus 5,928 last year - down 20.2% - and down 20.9% from 5,975 last month
• Monthly Average Sales Price per Sq. Ft.: $125.13 versus $108.05 last year - up 15.7% - and down 1.4% from $126.89 last month
• Monthly Median Sales Price: $182,700 versus $154,900 last year - up 17.8% - but down 1.4% from $185,000 last month

We are seeing an increasing number of price cuts among the active listings and a fairly rapid rise in the average number of days on market for closed sales. The average days on market for active listings is not rising, because there are plenty of new listings coming along that start with zero for days on market. This is not a good sign.

The Cromford® Market Index has started to head downwards again, though it currently remains above 90 at the lower end of the balanced zone. Should it drop below 90, as seems very possible, this will signal that a buyer's market is fully in effect. Many sellers are understandably reluctant to accept that the market has changed so dramatically in just 7 months, but they will probably need to be very realistic in the coming few months and price and negotiate accordingly.

We will need a significant acceleration in demand to change the current direction of the market. The most obvious potential cause of such a change would be an increase in the flow of money from lenders due to a relaxing of their guidelines, especially for first time homeowners. The lowering of the FHA loan limits has had a noticeable effect in the opposite direction. It will impact the price range from $275,000 to $375,000 in a major way. The introduction of the Dodd-Frank Act provisions has had little noticeable effect so far except by putting more constraints on seller financing by larger investors. However its main provisions are designed to limit mortgage money flow rather than encourage it. In contrast, Money is flowing well to the jumbo mortgage market and, as a result, 2013 was easily the best year since 2006 for the luxury home market.

Another possible positive change in demand would be increased household formation and home buying among those aged 25-35. At the moment this age group is placing stronger demand on rental supply and home purchases seem to be occurring to a lesser extent than for earlier generations.

Chris Tiller - M.B.A.
Russ Lyon Sotheby's International Realty
602.561.1346
chris.tiller@russlyon.com

Markets Can Change That Fast....

There are lots of list price cuts going on at the moment. In the last 7 days we have seen a total of 2,843 price reductions for active / UCB / pending / TOM listings across Greater Phoenix and just 256 price increases. The total dollar amount of the reductions was $31.5M and the increases amounted to $4.1M. Compared with the same week in 2013, there were 61.7% more price cuts and 26.2% fewer price increases. In dollar terms, the reductions were not quite so impressive - up 45.2% from the same time last year. Increases were down 24.1% in dollar terms.

This is a far more negative reading of seller confidence than we had in January 2013. Although we had a brief respite from the wave of price cuts between Thanksgiving and New Year we are now back up to the peak levels we saw in late October.

Negotiation power for buyers is probably the best it has been since 2011.

Correction: Last week I created a Pending Chart for Scottsdale noting that the distress sector was down 37%. It was actually 64% for that prior graph (I must have inverted the percentage) and currently more like 70% as shown in the updated 'replacement' graph below. Thanks for the correction Jeff Reich. This is an important stat / trend, as Jeff points out, showing that the 'steals' (average $ / Sq Ft of distress properties vs. normal) are a rapidly diminishing opportunity. The greater point of last weeks graphs and my commentary stands - that the reduction in sales activity is disproportionately tied to the reduction in the distress market.

The opportunity today, as the above Demand Index signifies and the sample Pending Sales trend in the graph below affirms, is sellers needing to be realistic and negotiable on price to attract today's smaller pool of buyers.

 

The latest Cromford® Market Index numbers for single family homes by city indicate where the market is strengthening or weakening:

·  Chandler continues to enjoy a seller's market at 116.5, up from 113.9 last week

·  Avondale is balanced at 102.4, up from 101.6 last week

·  Glendale remains balanced at 100.3, down slightly from 100.5 last week

·  Mesa is balanced at 99.5, up from 98.7 last week.

·  Scottsdale is balanced at 98.7, the same as last week

·  Tempe is balanced at 92.5, up strongly from 89.8 last week

·  Phoenix is a buyer's market at 88.7, down slightly from 88.8 last week

·  Peoria is a buyer's market at 83.9 and is down from 85.2 last week

·  Gilbert is a buyer's market at 81.8, but at least it is up from 80.1 last week

·  Goodyear is a buyer's market at 78.3, but is up from 77.7 last week.

·  Surprise is very much a buyer's market at 69.4, but is up from 68.6 last week

·  Queen Creek (including unincorporated San Tan Valley) is very much a buyer's market at 56.4, but is up from 55.8 last week

Far more cities moved up than down over the last week. Only Peoria deteriorated significantly. However the dominant cities of Phoenix and Scottsdale barely changed.

Just because a city is a buyer's market does not mean prices will come down. It takes a long time in a buyer's market for prices to react, typically 9 to 18 months. The balance of power can easily change before this happens, given the volatility we have seen in the past.

Year End Real Estate Summary

It was a banner year for Russ Lyon Sotheby’s International Realty. In fact, best ever, pushing 2.5 billion in annual sales. We are indeed grateful for opportunity to assist so many in making their move, as we strive for continued confidence and trust from those we serve.

Factors and Trends that played out in 2013 and set the stage for the residential market in the New Year…

Distress Market Normalized

Looking at the broader Arizona housing market, as has been well documented, we are in full recovery mode. Most notable in 2013 using the greater Phoenix Metro as our reference:

• On average, single-family home prices appreciated 20%. This is the broad brush and varies by price range and location. More on this below. However, in this context the point is that many homes that were 'underwater' are now back in an equity position as prices have risen sharply the past 3 years.

• Generally speaking, home prices have recovered to about two-thirds of what they were at the market peak in mid-2007.

The distressed market segment is nearly back to its historic norms:

• Foreclosure notices are at the long-term norm of 4.5 percent delinquencies, with Arizona actually ranking 42nd in the nation!




Active Listings by Status:

• Short sales – 11% and trending down
• Bank owned (REO) – 9%
• Normal sales – 80% and trending up

Download your own SIR Mobile app free at the app store for your device. 

Supply & Demand Balance

We came into 2013 with a short fall of available inventory relative to demand. By the end of the year supply (listings) and demand (sales) came into balance. This is best shown using The Cromford Market Index.

 

Cromford Market Index™ is a value that provides a short term forecast for the balance of the market. It is derived from the trends in pending, active and sold listings compared with historical data over the previous four years. Values below 100 indicate a buyer's market, while values above 100 indicate a seller's market. A value of 100 indicates a balanced market.

The Trends – Inventory; Sales; Prices

In the 3 graphs below we see a pronounced inverse relationship – as inventory (actives) decline, demand (sales) and prices increase. Then, rather abruptly, as inventory increases, sales decrease and the price trend flattens.

 

The Wall Street Journal cites the rise in interest rates as the cause for the decline in sales, most pronounced in Q3 and Q4. This is also somewhat typical and seasonally in Arizona. The expectation is that sales will pick up in Q1 and Q2 of the New Year.

Technology Impacts

Technology continues to impact the home sale process. Most notably, in 2013, worldwide, there were more Internet searches on a mobile device than on a computer!

Interest Rates & The Feds

The government’s influence on the market weighs heavily. Interest rates, while on the rise, remain near historic lows. On the plus side, the fact that low rates are ‘artificially low’ - a product of the Feds policy of quantitative easing, continues to create a ‘window of opportunity’ for buyers who need financing.

The significance of this can’t be overemphasized. For example, if we can assume that as the printing presses slow down, rates will go up (as we see today).

The direct consequence of higher rates is two-fold. First, eroding buying power for buyers needing financing. Then, as homes become more expensive, both demand and upside appreciation are compromised for sellers.

To make it concrete: For every 1% rates go up on an 80% loan (20% down) the effective cost of the property goes up almost 10%. This is because of what the difference in payments would amortize.

Dodd-Frank Legislation: Another government influence that will be in force in 2014 as the Qualified Residential Mortgage (QRM) rules take effect in January. The QRM rules were passed in 2010 as part of the Dodd-Frank legislation. For typical borrowers this should not have that great of an impact.

In any case, Russ Lyon Sotheby’s International Realty clients will have a decided advantage. This is because of our affiliation with EverBank. EverBank has Portfolio Power – meaning they have their own funds, with the ability to make loans based on their own underwriting criteria when appropriate. They also have the ability to underwrite loans within 24 hours of application!

The Luxury Market

While Russ Lyon Sotheby’s International Realty serves all price points with the same 'white glove' standard of care, there is no doubt that we dominate the luxury sector, participating in about 1 out of every 4 transactions over $800K.

The luxury market has improved this past year as well, with generally about 10% year-over-year appreciation.

Below you see Annual Appreciation by List Price Range. These are year-over-year average $ / Sq Ft numbers.

A main take-away is again, how the different price ranges vary. Location, of course, would be another major variable.

Yes, the -4.7 Annual Appreciation for $1.5 - $2M is a stand-out. However, it should be noted that this is based on comparing $ / Sq Ft for closings in the most recent month versus the same period 1 year ago and not a rolling average. The smaller samples from higher price ranges can skew the numbers.

Another interesting and instructive metric when parsing the market by price range is the number of months supply.

Connecting the dots between the Months Supply chart above and two sample Paradise Valley charts below, we see that as the inventory increases, even though luxury sales continue at a fairly steady pace, market times are increasing rather dramatically over $2M e.g the 4 to 5-year supply over $2M shown above.

Looking Forward

Well, the crystal ball is always a bit murky, but we can site trends…and we can borrow from those prognosticators who make it their business to look ahead. This from Brad Inman, publisher of the well-respected industry publication, Inman News:

• The private secondary mortgage market will be back in full force this coming year (though later in 2014), giving a fresh but sustainable lift to the housing market.

• Interest rates will be higher, but housing demand will be fierce, squeezing the inventory and driving up home prices.

…Begging the question…

Is there another Bubble on the Horizon? Talk of another bubble was in the news 6 months ago. However, it has been silenced as inventory increased and sales moderated over the past several months.

For those who still fear another bubble, local real estate guru Mike Orr, publisher of The Cromford Report, gives us the following 10 Reasons why this is extremely unlikely (some quotes; some paraphrasing to reflect current market conditions):

1. The population of Maricopa and Pinal Counties is growing much faster than the housing stock - this is fundamental, yet is hardly ever mentioned. All across the nation there is a housing shortage. New home construction has not kept pace with population growth.
2. In the first 6 months of this year prices were driven by a chronic lack of supply, not by excess demand. Demand is close to normal, albeit off some toward the end of the year.
3. As we pointed out above, prices are still well below the market peak, roughly the same level as 9 years ago.
4. Most buyers are putting their own money in with cash or large deposits, not borrowing it all from foolish lenders as in 2004 and 2005. It is an equity market.
5. Lenders are still being ultra cautious. Demand could increase if they ease up.
6. Investors are mostly buying to rent and filling their homes quickly with tenants - if and when these landlords sell it is a neutral event for the market - one extra home becomes available and one extra family needs a home to live in.
7. If investors started to sell off the small number of empty rentals it would slightly improve our market balance, not create a glut of supply.
8. There are several major long-term obstacles for developers trying to increase the supply of new homes. Shortage of labor and affordable, accessible land are just the first two.
9. We have a low vacancy rate both in homes for rent and for sale. Multiple generations and even multiple families are sharing single homes.
10. No bubble has ever occurred in the same market twice in the same generation. However after a recent bubble everyone is hypersensitive to every price increase and numerous false cries of "bubble" are par for the course.

In Sum

A ‘balanced market’ can translate to a good time for buying or selling, with a slight bias to today's buyers (as current sales are down). In fact, with or without that crystal ball, given the fading window of opportunity with artificially low interest rates, potential homebuyers who need financing should not procrastinate.

Once again, this is the broad brush. For a more precise picture of what’s happening in your particular area and price point of interest you want to talk to your Russ Lyon Sotheby’s International Realty neighborhood specialist. As the saying goes, ‘mastery is the art of making distinctions’.

In this ‘Year in Review’ we’ve shown the key variables at play in today’s housing market, primarily through the lens of the Phoenix Metro market.

How many investors bought in your city???

To round out our little series (from Cromford Daily Observations) on how much, when, what and where investor residential purchases were made there is this somewhat interesting tally. Now when the trivia question is asked, 'what percentage of the total investor revenue went into Scottsdale home purchases this past year,' you can just say 10.5% and be brilliant:)

December 20 - Based on the Affidavits of Value filed in Maricopa County for 2013 up to the end of November, the percentage of home sales revenue that was fuel by investor purchases were as follows:

1. Youngtown 44.8%
2. El Mirage 35.7%
3. Avondale 30.0%
4. Laveen 28.1%
5. Glendale 22.9%
6. Tempe 21.6%
7. Tolleson 21.1%
8. Phoenix 20.0%
9. Apache Junction 18.7%
10. Surprise 17.4%
11. Mesa 14.9%
12. Chandler 13.5%
13. Gilbert 13.3%
14. Peoria 12.9%
15. Litchfield Park 12.6%
16. Gila Bend 10.7%
17. Sun City 10.7%
18. Scottsdale 10.5%
19. Buckeye 10.5%
20. Goodyear 10.3%
21. Paradise Valley 9.8%
22. Carefree 8.9%
23. Fountain Hills 7.6%
24. Tonopah 7.3%
25. Wickenburg 7.3%
26. Cave Creek 6.4%
27. Waddell 6.3%
28. Queen Creek 6.3%
29. Sun City West 5.3%
30. New River 4.7%
31. Rio Verde 4.5%
32. Morristown 3.4%
33. Wittmann 1.2%

Given that investors tend to focus on cheaper homes these percentages of revenue are lower than if we looked at the percentage of unit sales. A normal guideline would be about 10% so the top twenty cities in this list saw more revenue coming from investors than normal. The percentages in the top four cities were abnormally high. If we are to see investors reduce their inventory at some point these cities are where it will have the most effect. Institutional investors represent only about 5% of the rental inventory. Most of the investment properties belong to "mom & pop" small scale investors.

Quick Pre-Christmas Update...

December 12 - The overall Cromford® Market Index is not moving a great deal but is down slightly over the last week. When we look at individual cities and their single family markets, there is a wide range of changes from Avondale (most improved) to Surprise (most deteriorating).

• Avondale has started recovery - up from 93.2 to 95.0 - 99.7 last month. Demand is stable but supply is falling.
• Tempe is improving from a seller's point of view - up from 81.3 to 82.8 over the last week and is now well above the 75.2 we saw last month. Demand is stable and supply is falling.
• Chandler is gaining ground from a seller's perspective - up from 105.6 to 106.8 over the last week - 105.8 last month. Demand has weakened a little, but supply is falling quite quickly now.
• Scottsdale is up very slightly from 100.5 to 100.7 over the last week - 101.4 last month. Demand is flat and supply has declined very slightly.
• Mesa is stable - up very slightly from 97.1 to 97.2 over the last week - 97.6 last month. Demand is flat and supply shows just a hint of falling.
• Peoria has fallen back again - down slightly from 91.2 to 91.0 over the last week - 92.8 last month. Demand has weakened a little, and supply is slightly higher.
• Glendale's is declining again - down from 107.2 to 106.4 over the last week - 106.2 last month. Demand has dropped while supply is stable.
• Queen Creek is still deteriorating slowly - down from 58.8 to 57.6 over the last week - 63.9 last month. Demand has weakened slightly and supply is still growing.
• Phoenix is weakening - down from 92.2 to 90.9 over the last week - 98.75last month. Demand has resumed falling but supply is stable.
• Goodyear is weaker again - down from 82.6 to 81.1 over the last week - 92.7 last month. Demand is down and and supply is increasing.
• Gilbert is a true buyer's market - down from 84.6 to 82.2 over the last week - 93.3 last month. Demand is still dropping and supply continues to grow slowly.
• Surprise is deteriorating further - down from 73.3 to 70.8 over the last week - 83.9 last month. Demand is weaker and supply is still growing fast.

December 11 - Active luxury single family listings (over $500,000) are becoming far more numerous in a number of areas, but not all. Here are some areas with significant increases in actives (excluding UCB):

• Anthem 85086 - 69 versus 34 last year
• Mesa 85207 - 78 versus 38 last year
• Sun Lakes 85248 - 39 versus 19 last year
• Chandler 85249 - 50 versus 34 last year
• Phoenix 85254 - 73 versus 32 last year
• Scottsdale 85259 - 189 versus 138 last year
• Scottsdale 85260 - 93 versus 64 last year
• Fountain Hills - 144 versus 101 last year
• Cave Creek 85331 - 148 versus 84 last year
• Peoria 85383 - 81 versus 32 last year

These are the only areas with a fall:

• Phoenix 85016 - 45 versus 56
• Phoenix 85050 - 20 versus 21
• Chandler 85226 - 5 versus 9

Although the luxury market has been helped by the advances in the stock market and greater availability of jumbo loans, the additional inventory is likely to limit appreciation over the coming months.