My first article in Fortune!

The Fundamental Reason House Prices Will Fall This Fall

“The prices people expect tomorrow influence demand and supply today.”

“The takeaway is that demand will continue to fall for many months–regardless of mortgage rates–because people are slowly lowering their expectations for future house price increases. Housing demand is falling along with the expectations for house price increases in the future.”

Number of Single-Family Houses Hitting the Phoenix MLS
1,000 to 2,000 Square Feet

Number of Single-Family Houses Hitting the Phoenix MLS
5,000+ Square Feet

Quick Tweets

Seems unsustainable.https://t.co/Y9vZODhNPX pic.twitter.com/3FYX7VoAMC
— John Wake (@JohnWake) September 25, 2022

Entry level home mortgage payments is up 42% in 1 year in Phoenix, according to @JBREC . https://t.co/QJUVbOwC6I
— John Wake (@JohnWake) September 22, 2022

Spoke with a lender in CA today and he mentioned more and more sellers are paying buyers closing costs

Worth nothing, as that’s often 20k of value to a buyer that won’t show up in closed sales price data #housingmarket
— Amy Nixon (@texasrunnerDFW) September 22, 2022

Mike DelPrete's latest on Opendoor.

Opendoor is probably the biggest single buyer of single-family houses in metro Phoenix. Their business decisions can affect the Phoenix market.https://t.co/yud1EDHkJz
— John Wake (@JohnWake) September 19, 2022

Monthly sales decreased 28.8% in August compared to August 2021. "Our market is best defined as balanced. … Supply is low, but demand is equally low." View the most recent STAT here: https://t.co/v0Na5me8mJ pic.twitter.com/LKd4VNaB8X
— ARMLS (@ARMLS) September 20, 2022

Phoenix No. 2 in the U.S. for cutting prices on home listingshttps://t.co/xIlSFC4ibK
— John Wake (@JohnWake) September 21, 2022

85% of Homeowners with Mortgages Have a Rate Far Below Today’s Level (<5%). Redfin found that homeowners with a rate below 3.5% were 7.6% less likely to put their homes up for sale in August than homeowners with a rate above 3.5%. https://t.co/EwmyXTaatO
— Taylor Marr (@TaylorAMarr) September 20, 2022

Although they were in the news constantly in 2021, all cash purchases weren't a ton higher in 2021 than in 2001.https://t.co/lK0wbrfTeM pic.twitter.com/CYpbDTNy2m
— John Wake (@JohnWake) September 22, 2022

Check out my first story for @azcentral!

Shooting at Scottsdale Airbnb motivates short-term rental opponents https://t.co/6lLbPMZLty
— Juliette Rihl (@JulietteRihl) September 17, 2022

Click on the graphs to go to the full-size, interactive version.

Notice how very small changes in New Listings and Solds eventually cause HUGE changes in the number of houses For Sale and house Prices (see graph above).

This information can vary a lot in different parts of metro Phoenix. Your real estate agent can find the data for your specific city or zip code at The Cromford Report.

Published on September 25, 2022

A Fundamental Reason House Prices Will Fall This Fall

My first article in Fortune!

The Fundamental Reason House Prices Will Fall This Fall

Quick Tweets