June is likely the peak for median home prices for the year. The median home price (green line) tends to fall in the Fall. I expect the median price for greater Phoenix to dip into the $240,000’s.
Phoenix has been strong and may see little or no decline in the median home price. The areas that have seen the largest falls in the median home – for example, Johnson Ranch, Maricopa and Anthem – will very likely continue to be the weakest markets this Fall.
The blue line is the number of listed homes sold by month. Looking at the yearly ups and downs, you’ll see with mathematically certainty that sales are going to taper off after the summer. We’ll certainly see several months with sales dipping below 5,000 – it’s a little time machine back to the real estate market of 2000 and 2001.
But now the median home price is $255,000 instead of in the $130,000’s as it was in 2000 and 2001. Despite the incredible increase in population since 2000 (increase in demand), sales are flat because the higher prices (quantity demanded at this price).
The economy is doing great right now but sales are trending lower. At these prices we could see sales bouncing around 5,000 a month for years to come and that would mean Listings would likely stay very high.
Listings (red line) only increased by 216 homes from June to July. (The Price and Sales data are cumulative for all of June but the Listings number was taken on one day in mid-July.)
It wasn’t until October last year that the increase in Listings was so small. So, it looks like Listings will fall again this Fall and they will start falling sooner than last year.
The decline in Listings was pretty steep last year… while it lasted. If the decline begins earlier this year, it’s a real possibility that the decline will last longer than last year. That suggests that the Listing inventory could fall more than last year.