Last month we mentioned that we expected active listings to grow between August and November. This may still turn out to be true, but they certainly did NOT grow between August and September. This is quite unusual and shows us how extreme the shortage of new listings has become. New listings have been arriving at a rate which is lower than in any August we have seen since 2001. In the last four weeks we saw 15.6% fewer new listings than last year and 13.2% fewer than in August 2012, the previous low record holder.
It is quite surprising that a slump in demand would be followed by a slump in supply, but it is certainly good news for sellers who might otherwise be facing growing competition from other sellers. If demand were to recover to normal levels now we could be facing a supply shortage fairly quickly.
Here are the basic ARMLS numbers for September 1, 2014 relative to September 1, 2013 for all areas & types:
Active Listings (excluding UCB): 23,296 versus 18,182 last year – up 28.1% – but down 2.5% from 23,900 last month
Active Listings (including UCB): 26,142 versus 21,359 last year – up 22.4% – but down 3.8% compared with 26,887 last month
Pending Listings: 5,951 versus 7,302 last year – down 18.5% – and down 2.1% from 6,079 last month
Under Contract Listings (including Pending & UCB): 8,797 versus 10,479 last year – down 16.1% – and down 3.0% from 9,066 last month
Monthly Sales: 6,417 versus 7,187 last year – down 10.7% – and down 6.2% from 6,844 last month
Monthly Average Sales Price per Sq. Ft.: $126.10 versus $119.38 last year – up 5.6% – but down 0.4% from $126.60 last month
Monthly Median Sales Price: $196,000 versus $182,000 last year – up 7.7% – but down 0.5% from $197,000 last month
Active listings (excluding UCB) rose 9.5% between August 1 and September 1 in 2013 but fell this year by 3.8%.
Demand has shown a few small signs of improvement in some isolated areas, such as Chandler, Tempe, and several locations in the West Valley. High end luxury homes continue to sell very well. Across Greater Phoenix in August we saw 19 closed sales of homes priced over $2,000,000, up from 10 in August 2013. We still have 32 listings under contract for homes of $2,000,000 or more, with 2 ultra-luxury listings over $10,000,000 currently in escrow. However the entry level luxury market is not looking quite so strong.
By this time next month we expect to be in a very neutral market with demand and supply in almost exact balance.