From December 2017 to January 2018, the number of new listings increased to approximately 10,587 (up 4,324 listings from last month) listings which is an increased of 69% from 6,263 listings in December. The number of sold transactions was approximately 6,212 sold transactions (down 992 transactions from last month). The decrease in number of transaction and the sharp increase in number of new listings has caused the months of inventory to increase from 2.73 months in December to 3.90 months which is an increase of +38.8%. This is normal to see a sharp increase in the number of new listings coming on the market after the holidays and it will take several months to see an increase in the number of sold transactions due to the time it takes to close a transaction. Overall, the inventory of homes on the market is still very low where in January 2018 there were 19,185 homes (down 503 listing from last month) on the market as compared to 27,050 listings on the market in January 2014.
The Phoenix Housing Market ended 2017 with an overall annual appreciation rate of approximately +9.0%. If inventory remain low throughout 2018 and a strong demand for housing continues we can expect the market to continue to appreciation above the national average. From December 2017 to January 2018, the average sold price increased from $309,327 to $315,070 in which is a +1.9% increase. Historically, the real estate prices don’t start to increase until February or March but this year price appreciation has started early. Since July 2017, the number of sold transactions has been decreasing from 8,024 sold transaction to 6,212 sold transactions in February 2017. Although the overall number of sold transaction have been decreasing the current percentage of foreclosures and short sales sold remains at only 1% of the market which indicates a healthy market. Since February 2017 (12 months ago), the average days on market has decreased approximately -7.4% (up from last month) and the number of sold transaction has decreased approximately -5.0% (up from last month).
Since February 2017 (12 months ago), the number of homes for sale on the market have decrease approximately -15.2% or 22,612 homes for sale on the market to a gradual decrease of 19,185 homes (Down 3,427 homes). Historically, 19,185 homes for sale represent the lowest number of homes this market has seen for over a decade. Property owners are not putting their homes on the market because the overall macro economy remains strong and they are holding off to accumulate additional appreciation from the market. This low number of homes for sale indicates we are in a seller’s market (low supply and increased demand).
Real estate prices will continue to increase and interest rates are planned to increase in 2018 so if you are thinking about buyer a home this year will be the time to buy before you get priced out of the market. Give us a call to discuss your best buying or selling strategy, TODAY!!