Single-family homes are selling in Phoenix market in a blink of an eye

Above: Photo by cottonbro from Pexels Real Estate | 28 Oct |

The desire to live in a single family resale home is strong.  So strong that purchase prices for single family resale homes are at all-time highs in Greater Phoenix.  But purchase prices are not the only number that has reached an all-time high.  So has monthly rental rates for single family resale homes.  The single family rental market has boomed during the pandemic.  Even before the pandemic the robust demand to live in a single family home saw single family rental communities springing up in Greater Phoenix.   This is report is on single family resale homes in Greater Phoenix, which is the most popular residential product when measured by the number of sales.  The data in this report is compiled from the Arizona Regional Multiple Listing Services, Inc, known as ARMLS. 

In September many properties were only on the market for a blink of an eye.  There was a ninety-two percent increase in the number of single family resale homes that were on the market for only one day in September 2020 compared to September 2019.  The number of homes on the market for five days or less this September increased by eighty-five percent over September of last year.  So when thinking about the estimated supply of inventory no longer think in terms of how many months of supply there is, but now think in terms of how many days of supply.  As of October 8, the overall estimated months of supply was less than one month.  For active listings under $350,000 there was a twelve day supply.  For listings between $350,000 and $499,999 there was an eighteen day supply.  The traditional thought amongst many real estate agents was that a six month supply of inventory represents equilibrium between a seller’s and buyer’s market meaning neither had a market advantage.

I sound like a broken record.  But it happened again.  The September 2020 median purchase price for a single family resale home in Greater Phoenix reached a new record high.  It reached $362,000.  This is $5,000 higher than August 2020 and $42,000 higher than January 2020.  To date the 2020 median purchase price year-over-year is up twelve percent.  This is the highest year-over-year Increase in seven years.  And this is happening during a pandemic and high unemployment.

The September 2020 median monthly rent for a single family resale home in Greater Phoenix, after setting an all-time high of $1,895 in August 2020, dropped in September 2020.  In September it was $1,862 down $33 from August 2020.  In January 2020 it was $1,650.

Sales of single family resale homes were 6,632 in September 2020.  This was 974 or seventeen percent higher than September 2019.  September 2020, so far this year, is the month with the highest year-over-year increase in sales.

New monthly listings of single-family resale homes in September 2020 were 7,479 which were 3 more than August 2020 and were 939 higher than September 2019.  More sellers listed their homes in the third quarter than in either the first or second quarters of this year.  This is not the normal seasonal pattern, but of course this is not a normal season.  There were 21,980 new listings in the third quarter compared to 20,790 in the first quarter and 18,565 in the second quarter.  There were 20,226 sales in the third quarter compared to 15,738 in the first quarter and 16,442 in the second quarter.

Conclusion

Even with a pandemic and high employment the very strong demand to live in a single family resale home has created record purchase prices and monthly rents.  If you are a buyer, and you see a property you want, don’t blink.

 

Fletcher Wilcox is vice president of Grand Canyon Title, a subsidiary of FNF a Fortune 500 Company.

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