By Mike Bodeen · 13 October 2025
Our market continues to befuddle. It’s a market that’s creeping along at the low end of sales activity. Listings are now back to increasing – 6% over last month. To be fair, this is normal for September and October, and the real test will occur in the next 30 days when listings drop heading into the holidays. Will this year be different?
Listings under contract (but not yet closed) are down 9% form last month. Sales (closed) are down from last month. Months of unsold inventory has increased from 3.8 to 4.1 – in a month.
“…being in this languishing market for three years now has messaged buyers that prices and rates are not going to move much and it’s time to get a home and begin to enjoy it.”
But here’s the befuddlement: Prices are increasing (albeit nominally) when in theory they should be decreasing. When supply exceeds demand, prices drop, right? But as mortgage rates have been dropping, we’re seeing more buyers enter the market. And this has yet to account for even lower rates occurring recently. Have buyers figured it out that prices may not drop that much and now might be their best shot to buy? It’s a good question.
Buyers have leverage though. Many of the homes on the market have languished for 3 or more months. Many sellers have not seen even one offer in that time while some sellers are wondering, “doesn’t anyone like my home?” When that (even low) offer finally comes in, it’s often met with a rush of happy and a very willing seller.
Sellers should strongly consider reasonable offers, though it may seem pridefully low from where you first listed the home at. We should remember the heights that our homes appreciated to. Chances are good, a seller’s equity take-away after closing is pretty good.
Even though our current market could be described as sluggish, the Phoenix Metro residential real estate market, as history has shown, has the potential of swinging wildly one way or another. It would be of no surprise to regular observers of our market that could witness a radical buyer or seller’s market in a relatively short period of time.
So why are values increasing or at least not falling? I think that being in this languishing market for three years now has messaged buyers that prices and rates are not going to move much and it’s time to get a home and begin to enjoy it.