The median home price (green line) in Greater Phoenix dropped another $5,000 in August to $245,000 after dropping $5,000 in July. That’s a 4% drop in 2 months.
Looking at past years, it’s not uncommon to see another price drop in September before leveling off, more or less, through the remainder of the year. The number $5,000 seems very popular recently so that magnitude of decline in September wouldn’t surprise me at all. The question is whether the median price for Greater Phoenix will level off in October as it has tended to do in the past.
This was my advice last month.
If you have a home up for sale, I would strongly suggest dropping the price very aggressively until it sells. Get it sold ASAP. We’re not likely to see much good news for home sellers in the next 6 months.
The blue line is the number of listed homes sold by month. August was way below trend. You can really see the effect of the sub-prime crisis in August reflected in this number. There were 4,350 total sales in the local MLS in August. That’s 377 fewer sales than in July or an 8% decline.
Historically, sales have increased in August or been similar to July so that’s a big change. This supports those who have said the market weakened significantly in August.
The inventory of homes listed for sale (red line) increased at a good clip from August 15 to September 15. Last year inventory declined rapidly starting in October as fewer homes hit the market. It will be interesting to see if that happens again this year.
“MLS Listings” are measured at one point in time, usually the 15th day of the current month. “Median Price” of homes sold and the total number of home “MLS Sales” are for the entire preceding month.