By Mike Bodeen · 13 March 2023
Mike’s Note: Silicon Valley Bank failed this past week, and it’s yet too early to see how mortgage rates will respond to this, though economic bad news is often good news for long term mortgage rates. How’s that for a positive spin?
Will we look back at this brief buyer opportunity window and lament that more first-time buyers were not able to participate in finding that “right” home in Phoenix? Or is this a blip on the screen that will shortly reverse course having the number of listings head north?
The envelope please. Umm, it’s empty. Oh Well, here’s the data.
First off, we look at the current trending of active listings by noting the chart below. Currently, we have 14,772 listings available for purchase in Phoenix metro. For contrast, our peak at this time of year was back in 2008 when we had close to 56,000 listings for sale. At the other end of the spectrum was 2021-2022 when we had under 5000 available.
How does this translate into time on the market? Last quarter, we had 3.9 months of supply available. Today we have dropped to 2.3 months.
Monthly sales, though a lagging trend, we find February’s sales at 6,463, compared with 4,693 last quarter – a 38% increase.
Next, we look at listings that are under contract, and we find 9,137. This is a 41% increase from last quarter (6,470).
Here’s another one to throw in – the listing success rate, which gauges the percentage of homes that close escrow after they were listed. That number is now at 78.3%. Last quarter, it was at 61.8%.
Finally, what about pricing? They’ve been dropping still, right? Well, not so much. The median price for monthly sales is now $417,000 which increased from $410,000 just since last month.
So, what’s the point Mike? The point is that the numbers are not trending well for first time homebuyers. Prices increasing. Supply decreasing. It looks like a closing window. But as mentioned at the start of this Snap Shot, rates could drop with the bank(s) failure happening. Maybe it slows a falling window.