I reported on the January home sales earlier but I don’t think I paid enough attention to the fact that the homes sales in metro Phoenix in January 2014 were the lowest since February 2008. See the blue line in the graph below.
January is almost always the slowest month of the year for closings but just think about that, home sales in January 2014 were lower than in January 2009, January 2010, January 2011, January 2012 and January 2013.
Phoenix home price forecast
Some real estate numbers geeks are worried that Phoenix home prices could dip a bit. I don’t think that will happen because the inventory of homes for sale (the red line in the graph below) isn’t too high… but that 5 year thing makes me less confident than I was.
Continued low sales (and a rising number of new listings) could, however, lead to inventory that would indeed be too high and that would put downward pressure on Phoenix home prices.
March home sales will be the bellwether for how the metro Phoenix real estate market will play out for the rest of 2014. I expect we’ll see the normal big seasonal bump in sales in March and that will put the brakes on the rising inventory and the threat of lower prices.
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