Price (green line)
The median price in metro Phoenix of single family homes sold via the MLS fell to $120,000 in March 2009. The median home price in Phoenix, Arizona hasn’t been that low since sometime in the 1990’s. I only have data back to January 2000.
At $120,000, the median single family home price in metro Phoenix has fallen 55% from the peak median home price of $264,800 in June 2006.
I expected that the median home price would NOT fall from February to March but, instead, it fell significantly, by $7,900. Oh well. Maybe I called it too early :). Let’s see what April brings.
Even if the median price levels off this Spring, I would expect price weakness this Autumn. It’s looking like it will be 2010 before we see “normal” appreciation in residential real estate. The price bottom of this cycle may not be until next December or January.
Well, there is one bottom I can peg accurately.
The bottom for number of homes sold was January 2008. See the graph.
Sales (blue line)
Single family home sales in metro Phoenix AZ in March were super strong at 6,899 homes. That was the best month for home sales since May 2006 and was 71% higher than a year earlier in March 2008.
Looking at the graph you can see that March often sets the trend for the number of homes sold in the following months. Strong March sales mean strong Spring sales.
Listings (red line)
The number of single family detached homes listed for sale FELL 5% from mid-March to mid-April. The mid-April inventory is 25% less than a year earlier, in mid-April 2008.
The March inventory of single family homes listed for sale was equivalent to a 6 months supply of homes.
Many people consider 4 to 6 months inventory to be “normal.” (I lean towards 5 to 7 months inventory as being “normal.”)
A year ago, in March 2008, we had a 13-month inventory. The inventory peaked at over 17 months in November 2007.
We will likely see a continued sharp lowering of “months of inventory” of homes listed for sale which should soon stop the fall in the median home price in metro Phoenix… at least temporarily.
The metro Phoenix housing market is correcting rapidly now.
(“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.)