Phoenix Housing Market Slips as Seller Momentum Fades

In the real estate market, recent trends have shown a pronounced decline, with the Cromford® Market Index (CMI) recording an average drop of 5.0% over the past month. This decrease is sharper compared to the 3.4% fall observed last week, signaling an intensification of the downward trajectory initiated five weeks ago. The market is witnessing not only a rise in the frequency of price reductions but also in their magnitude, underscoring a growing pressure on sellers across multiple cities.

Interestingly, despite the overall decline, a few cities have demonstrated resilience or even growth. Out of the seventeen cities monitored, only four have shown an increase in their CMI over the past month, while the majority, thirteen cities, have experienced a decrease. Maricopa stands out as the most significant positive mover, with a modest 4% increase in favor of sellers. This contrast highlights the varied responses of different local markets to broader economic conditions.

On the other side of the spectrum, several cities are clearly shifting towards buyer-friendly conditions. Notably, Gilbert, Peoria, Goodyear, Paradise Valley, Mesa, and Glendale are tilting in buyers' favor, with Gilbert experiencing the most rapid market deterioration. This shift indicates that buyers in these areas might find more negotiating power and better deals due to increased inventory and reduced competition.

Despite these changes, the market's overall landscape remains predominantly in favor of sellers, with 11 out of 17 cities still classified as seller's markets, maintaining a CMI above 110. However, Goodyear presents a unique scenario, aligning closely with a balanced market, while five other cities have transitioned into buyer's markets. This mixed picture reflects the complexity and localized nature of real estate dynamics, where market conditions can vary significantly even within relatively close geographical areas.

Rates have been seeing some relief but not enough to change demand in a major way. As we head into election season will be interesting to see if politics plays a factor in the Federal Reserve's decision to have a rate cut at all. If that happens it could start to make things interesting.

"Our greatest weakness lies in giving up. The most certain way to succeed is always to try just one more time."
-Thomas Edison

Have a great week everyone!