Supply And Demand Out Of Balance

Supply And Demand Out Of Balance

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The total number of active listings (including those in UCB or CCBS status) is 19,736 today for all areas & types across the ARMLS database. This is just slightly above June 15, 2011 when we saw 19,696. We have to go all the way back to October 2005 to find another 15th date (19,715) with lower active listings.

Active listing counts have been on a declining trend since April 2014 when we hit a short term peak of 30, 506. We would consider somewhere between 30,000 and 35,000 to be sufficient for a balanced market. The all-time record high for a 15th date is 58,195 in November 2007.

Even if we are hearing about signs of a fall in demand, mainly at a national level and in regions outside Arizona, supply is so low at the moment, demand would have to drop a lot more for us to reach a balanced (and smaller) market.

Sometimes it can be revealing to examine a market by breaking it into just a few large geographic areas. Below is a table of some key statistics for single-family homes comparing August 2018 with August 2017.

AreaAnnual Change in Annual Sales RateAnnual Change in Active Listings (excluding UCB/CCBS)Annual Change in Days of InventoryCentral & North Valley+2.4%-1.5%-5.3%Northeast Valley+6.3%-16.3%-19.7%Pinal County+4.2%-16.5%-19.8%Southeast Valley-0.1%-16.3%-16.3%West Valley+2.3%-9.4%-12.3%

For sellers, every area has seen an improvement, but the Central & North Valley has seen by far the lowest percentage reduction in days of inventory. This is primarily due to a very small drop (-1.5%) in active listings compared to the rest of the valley.

The Northeast Valley and Pinal County have both seen a big improvement for sellers with an almost 20% drop in days of inventory. Both had a large 16% decline in active listings without a contract while they both saw strong increases in annual sales, with the Northeast the strongest of all.

The Southeast Valley saw a similar fall in active listings to Pinal County and the Northeast, but the annual sales rate has not managed any growth. It therefore lags behind the other two areas in positive movement for sellers.

The West Valley managed a similar increase in the annual sales rate to the Central Valley but saw a more significant drop in active listings.

Ranking the areas by improvement for seller's prospects we have:

  1. Pinal County

  2. Northeast Valley

  3. Southeast Valley

  4. West Valley

  5. Central & North Valley

It is surprising how different the areas are to one another and also how much the Northeast Valley has improved for sellers over the past 12 months.

(Courtesy of the Cromford, August 2018)

#NatashaTomlinson #realestate #arizona #realtor #azliving #housing #house

Natasha Tomlinson Headshot
Phone: 480-203-4364
Dated: August 17th 2018
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