The most recent data for the Phoenix metropolitan area shows that real estate sales is continuing to slow down, indicating we are returning to a normal market. Most analysts are describing this transition as a positive step towards a sustainable, healthy real estate market. For Front Porch Properties, we have been very busy. We have helped more buyers and sellers in the first two months of 2014 than in any other two month time period in the history of our company. This conflicting information brings up an interesting point. The Phoenix area is so large geographically, that when you look at the aggregate numbers for all over the Valley the results in specific neighborhoods or communities maybe different.
The month of January saw sales decrease the Phoenix real estate market compared with December. We closed on 4,797 properties in the Phoenix Metro area, that is a decrease of 19.6% while being 17.1% lower from the same period last year.
New inventory of recently listed homes shot up by 79.5% to 10,888 properties. As a result, total inventory increased by 12.5% to 28,464 homes for sale. This is an increase of 28.9% over last year’s home listed for sale. With sales decreasing and more homes listed for sale we bounced back to 5.93 Months Supply of Inventory. Pending Foreclosures in the Phoenix Metro Area are continuing to drop, last month we hit a new low of 5,698, a reduction of 4.6% over last month and 48.8% over the past twelve months.
Home prices were mixed in January. The average list price has increased 9.1% over December to $322,000. The average sales price was $242,700, a decrease of 1.7% from December. The Days on Market increased seven days to 79.
I just read an article that quoted Frank Nothaft, the chief economist with Freddie Mac, projecting 2014 will be the first time since 2000 that most of the home loans made in America will be for purchasing a house. This indicates that fewer investors are purchasing residential real estate. As a result, fewer investment homes will be coming on the market. Ideally this could be good news for investment home owners, less supply should mean higher rents in the future. We will all wait to see if these predictions come true.
“Now is a great time to own real estate in Phoenix!”