Phoenix Housing Market Gains Momentum as Seller Conditions Improve

The Phoenix area housing market has continued its recent trend in favor of sellers, showing further momentum in the month of August. The Cromford® Market Index (CMI) reflects a monthly average change of +6.9%, a notable jump from last week's 4.5%. This surge is largely driven by a consistent decline in housing supply across the Valley throughout July and August. Out of the 17 cities tracked, 14 have become more favorable for sellers, with only three cities, Maricopa, Tempe, and Surprise, showing slight improvement for buyers.

Paradise Valley continues to be a major contributor to the upward trend for sellers, due in part to its extremely limited inventory. With historically low supply and high dollar volume, the city continues to skew the overall numbers in sellers’ favor. However, it’s not just Paradise Valley fueling the shift; many cities across the Phoenix metro area are experiencing reduced new listings, pushing supply levels down and nudging market balance toward the sellers’ side.

Adding to the optimism for sellers is the recent dip in mortgage rates following the release of unexpectedly weak job creation numbers. The 30-year fixed rate is now hovering around 6.55%, its lowest level in ten months. While it’s too soon to see any definitive boost in buyer activity, this rate movement could trigger a modest increase in demand, especially if borrowing costs stay low for an extended period. If both low inventory and reduced rates persist, sellers could find themselves in an even stronger negotiating position in the near future.

That said, there's reason for cautious optimism. As cooler weather arrives in late September, supply typically starts to rise again. This seasonal shift could slow the current trend and introduce new dynamics into the market. Whether demand can catch up before supply returns will be a critical factor in determining how long this seller-friendly momentum can last.

"If you do what you've always done, you'll get what you've always gotten."
-Tony Robbins

Have a great week, everyone!