By Mike Bodeen · 21 September 2020
Usually the 3rd quarter (July-September) of the sales year is weak. According to The Cromford Report, we have “entered a new phase of the market, where prices are rising far faster than the past 5 years. The last 3 months, per Cromford, has seen the average PSF (Price Per Square Foot) rise 8.1%. I repeat, 8.1% for just the last 3 months – not the past year!
“As recently as this past May, the PSF was at $186.79 – an annualized appreciation basis of 33%.”
Based on current Pending Listings at $195.30 PSF, Cromford is anticipating an increase of 1.2% by October 15th. Also of note, distressed listings (REO’s Short Sales, Pre-Foreclosures) remain well below normal.
And that prediction may be short. As if that wasn’t radical enough, as of September 19th, the average PSF was reported to be at $200.67, the first time this PSF read over $200 since 2006. As recently as this past May, the PSF was at $186.79 – an annualized appreciation basis of 33%.
As recently as this past May, the PSF was at $186.79 – an annualized appreciation basis of 33%.
The market continues to heat up, far more than anyone could have predicted, especially since the Covid-19 pandemic struck the country.
Phoenix Rent Growth Tops Nation, But is there Stabilization?
Demand for rental housing, combined with lack of supply, has caused the Phoenix-Metro rental market to have the highest year-over-year price increase of any of the top 20 metro regions in the country.
Good news for renters, is that per this recent study, the July 2020 rent increase was 4.7%, which was significantly less than recent measurements, but which is still 2.5 times that of the national index.
Keep in mind that timing and different data tracking firms utilize different methods of measurement. For example, the Cromford Report currently shows a price per square foot (PSF) of $1.15 as of September 1st, up from $1.10 in July.
And what about the current moratorium on evictions? How will that play into future rents and occupancy rates? How are landlords handling that? In thousands, if not tens-of-thousands of cases, landlords have lost money. How long can that last? In a future report, we will address these situations. Read the full article here.
Market data referenced in this article comes from The Cromford Report.