Phoenix Housing Market Trends: Buyer Momentum Builds as Inventory Rises

The Phoenix housing market continues to shift in favor of buyers as 15 out of the 18 largest cities have become more favorable to them over the past month. Only three cities, Tempe, Gilbert, and Mesa, moved in a direction more favorable for sellers. Leading the pack for buyers are Cave Creek and Avondale, while the rest of the buyer-friendly cities saw more modest improvements, with changes of 6% or less. The Cromford Market Index (CMI) posted an average decline of 2.8%, a notable acceleration from last week’s 1.1% dip, signaling increased buyer leverage across the Valley.

Currently, the breakdown includes 5 cities in seller’s markets, 6 in balanced territory, and 7 in buyer’s markets. The primary force behind these shifts is a growing supply of active listings. While demand has seen slight gains, its pace remains slow and far from robust. If seasonal patterns hold true, we should see inventory peak by mid-November, followed by a 6-week stretch of declining competition, a window that may benefit sellers ready to act strategically.

However, predicting the future of demand is far more complex. Unlike supply, which follows more predictable seasonal cycles, demand is often influenced by emotional and psychological factors, not just financial ones. Right now, overall demand sits approximately 20% below historical norms, and while it could rebound, it’s just as likely to stagnate or decline further. Buyers remain cautious, and sellers must price competitively and present well to stand out.

Heading into late fall, all eyes will be on how buyers respond to changes in rates, inflation, and broader economic sentiment. With supply likely to rise for another few weeks, the next meaningful move in the market may come from whichever force, supply or demand, changes course first.

"There's a natural law of karma that vindictive people, who go out of their way to hurt others, will end up broke and alone."
-Sylvester Stallone

Have a great week, everyone!