The Cromford Report – Daily Observations February 2018

    February 28 – The S&P Case-Shiller Index report for the 3 months ending December 2017 was released yesterday. Here are the changes in the index over the last month:

    1. Las Vegas +0.76%
    2. Los Angeles +0.68%
    3. Seattle +0.57%
    4. Denver +0.55%
    5. San Francisco +0.53%
    6. Tampa +0.31%
    7. Atlanta +0.26%
    8. San Diego +0.22%
    9. Phoenix +0.21%
    10. Portland +0.17%
    11. Charlotte +0.15%
    12. Dallas +0.06%
    13. New York +0.01%
    14. Miami -0.11%
    15. Detroit -0.02%
    16. Boston -0.20%
    17. Washington -0.21%
    18. Cleveland -0.29%
    19. Minneapolis -0.38%
    20. Chicago -0.60%

    Phoenix increased by a very modest 0.21% but this was enough to place us above the middle of the pack. The US national index increased by 0.23%.

    Our closest neighbor Las Vegas is currently enjoying much stronger appreciation.

    When we examine the year over year changes we find:

    1. Seattle +12.7%
    2. Las Vegas +11.1%
    3. San Francisco +9.2%
    4. Los Angeles +7.5%
    5. Denver +7.4%
    6. San Diego +7.4%
    7. Detroit +7.1%
    8. Dallas +6.9%
    9. Portland +6.8%
    10. Tampa +6.2%
    11. Charlotte +5.9%
    12. Phoenix +5.6%
    13. Boston +5.5%
    14. New York +5.4%
    15. Atlanta +5.4%
    16. Minneapolis +5.2%
    17. Miami +3.6
    18. Cleveland +3.5%
    19. Washington +2.8%
    20. Chicago +2.6%

    Over the last 12 months Phoenix has appreciated by less than the national average , which was 6.3%.

    This means that Phoenix is getting relatively more affordable, despite being less affordable in absolute terms. Prices have been rising much faster in the large California cities of San Francisco, Los Angeles and San Diego.

    February 27 – Turning to the West Valley, here are the ZIP codes ranked by annual average $/SF. We have included the western most parts of Phoenix.

    We will use an extended definition of the Southeast which includes parts of Pinal County

    Rank City ZIP 2017 $/SF 2016 $/SF % Change
    1 Wickenburg 85390 $152.07 $126.76 +20.0%
    2 Peoria 85383 $150.33 $140.88 +6.7%
    3 Glendale 85310 $148.06 $137.42 +7.7%
    4 Goodyear 85395 $145.19 $139.30 +4.2%
    5 Glendale 85308 $143.09 $134.86 +6.1%
    6 Peoria 85382 $137.50 $131.74 +4.4%
    7 Surprise 85387 $137.11 $129.42 +5.9%
    8 Surprise 85374 $134.32 $126.99 +5.8%
    9 Peoria 85381 $132.41 $123.45 +7.3%
    10 Litchfield Park 85340 $130.34 $121.60 +7.2%
    11 Sun City West 85375 $129.50 $123.51 +4.8%
    12 Wittmann 85361 $129.09 $120.98 +6.7%
    13 Buckeye 85396 $128.31 $126.46 +1.5%
    14 Glendale 85306 $126.98 $120.12 +5.7%
    15 Goodyear 85338 $123.30 $115.58 +6.7%
    16 Peoria 85345 $122.81 $112.12 +9.5%
    17 Surprise 85378 $120.66 $106.75 +13.0%
    18 Glendale 85307 $120.62 $109.21 +10.4%
    19 Glendale 85304 $120.55 $113.25 +6.4%
    20 Glendale 85305 $120.29 $113.61 +5.9%
    21 Waddell 85355 $117.30 $110.88 +5.8%
    22 Avondale 85392 $115.24 $105.65 +9.1%
    23 Glendale 85303 $113.97 $104.94 +8.6%
    24 Sun City 85373 $113.81 $107.04 +6.3%
    25 Glendale 85302 $112.28 $102.55 +9.5%
    26 Surprise 85379 $111.92 $104.06 +7.6%
    27 Surprise 85388 $111.03 $103.67 +7.1%
    28 Sun City 85351 $109.90 $97.05 +13.2%
    29 El Mirage 85335 $108.79 $98.27 +10.7%
    30 Avondale 85323 $107.70 $99.84 +7.9%
    31 Phoenix 85043 $107.64 $95.23 +13.0%
    32 Phoenix 85035 $106.95 $96.95 +10.3%
    33 Phoenix 85037 $106.42 $96.35 +10.5%
    34 Buckeye 85326 $104.70 $95.63 +9.5%
    35 Tolleson 85353 $102.95 $96.15 +7.1%
    36 Phoenix 85033 $102.54 $89.15 +15.0%
    37 Youngtown 85363 $101.77 $90.82 +12.1%
    38 Phoenix 85009 $99.06 $84.85 +16.7%
    39 Phoenix 85031 $92.60 $80.45 +15.1%
    40 Glendale 85301 $90.55 $81.77 +12.1%
    41 Tonopah 85354 $88.59 $90.21 -1.5%
    42 Arlington 85322 $77.19 $71.98 +7.2%

    Tonopah sticks out like a sore thumb here with the only negative appreciation. Most of the West Valley looks strong though Northern Buckeye (85396) is relatively weak.

    At first, Wickenburg looks like it is being helped by the new 55+ homes being built by Trilogy. But in fact this is not the case since Trilogy at Wickenburg Ranch is in Yavapai County and sales are not included in our Cromford Public data.

    February 24 – We are now going to compare ZIP codes within the Southeast Valley region to see which are the most expensive and most affordable and report on how much prices have changed over the past year. To do this with the greatest accuracy we will use the county recordings from Cromford Public and include all single-family, condos and townhomes. We will use the annual average $/SF for 2017 and compare with 2016.

    We will use an extended definition of the Southeast which includes parts of Pinal County

    Rank City ZIP 2017 $/SF 2016 $/SF % Change
    1 Tempe 85281 $183.02 $168.02 +8.9%
    2 Tempe 85284 $175.46 $170.61 +2.8%
    3 Chandler / Sun Lakes 85248 $164.22 $155.89 +5.3%
    4 Phoenix 85044 $163.29 $156.35 +4.4%
    5 Chandler 85226 $163.04 $155.55 +4.8%
    6 Mesa 85207 $162.16 $155.08 +4.6%
    7 Phoenix 85045 $159.56 $143.93 +10.9%
    8 Phoenix 85048 $159.50 $156.29 +2.1%
    9 Gold Canyon 85118 $156.90 $151.68 +3.4%
    10 Chandler 85286 $156.56 $147.82 +5.9%
    11 Chandler 85224 $152.44 $145.65 +4.7%
    12 Mesa 85215 $151.75 $138.23 +9.8%
    13 Gilbert 85298 $151.71 $145.33 +4.4%
    14 Tempe 85283 $151.56 $143.03 +6.0%
    15 Tempe 85282 $150.65 $139.36 +8.1%
    16 Chandler 85249 $150.18 $143.65 +4.5%
    17 Gilbert 85233 $149.55 $141.79 +5.5%
    18 Chandler 85225 $147.86 $135.72 +8.9%
    19 Gilbert 85234 $147.28 $138.91 +6.0%
    20 Gilbert 85296 $146.20 $136.06 +7.5%
    21 Gilbert 85297 $141.66 $135.20 +4.8%
    22 Mesa 85213 $140.24 $130.62 +7.4%
    23 Gilbert 85295 $139.45 $131.98 +5.7%
    24 Mesa 85209 $139.08 $130.58 +6.5%
    25 Mesa 85205 $137.38 $128.47 +6.9%
    26 Mesa 85212 $136.35 $126.69 +7.6%
    27 Mesa 85204 $135.04 $122.79 +10.0%
    28 Apache Junction 85119 $135.02 $121.93 +10.7%
    29 Mesa 85206 $134.28 $124.54 +7.8%
    30 Mesa 85202 $132.50 $121.89 +8.7%
    31 Mesa 85203 $132.35 $119.92 +10.4%
    32 Mesa 85208 $130.38 $119.63 +9.0%
    33 Mesa 85201 $129.89 $114.16 13.8%
    34 Mesa 85210 $129.75 $119.83 +8.3%
    35 Queen Creek 85142 $127.13 $119.93 +6.0%
    36 Apache Junction 85120 $124.86 $114.60 +9.0%
    37 San Tan Valley 85140 $117.58 $112.27 +4.7%
    38 San Tan Valley 85143 $98.45 $90.28 +9.0%
    39 Florence 85132 $97.18 $87.63 +10.9%
    40 Maricopa 85138 $93.84 $86.01 +9.1%
    41 Maricopa 85139 $84.69 $80.35 +5.4%

    We can see that 85045 has recovered well from the temporary slump caused by the building of the 202 freeway extension.

    Tempe 85281 is the most expensive location based on average $/SF, but many of its homes are relatively small apartments, so it does not have a particularly high average or median sales price.

    Mesa 85201 is the fastest appreciating ZIP code, ideally placed at the intersection of 101 and 202 freeways, though with many older properties in need of renovation. Several years ago I suggested to the Mesa City authorities that this area of West Mesa had the most potential for gentrification and increases in property value.

    We note that Florence and Apache Junction are among the fastest appreciating areas of the wider Southeast Valley.

    February 23 – The table of Cromford® Market Index values for the single-family markets in the 17 largest cities looks like this today:

    Here we see a mixed picture. 10 cities improved but only one (Tempe) by more than 10%. 7 cities deteriorated including 3 (Fountain Hills, Cave Creek and Maricopa) by more than 10%.

    The Southeast Valley dominates the top of the table due to very low supply. This includes 4 major cities over 200 which is quite unusual.

    On the other hand we now have 3 cities below 120 having had zero just a few weeks ago.

    February 20 – Now let us compare new build pricing with re-sales for the Northeast Valley.

    Again we will use the county recordings from Cromford Public and include all single-family, condos and townhomes. We will use the annual average $/SF for 2017 and compare with 2016.

    Note that this process will NOT include the few custom homes where the owner purchases the vacant lot before the homes is constructed. These homes do not appear in the county records until they are eventually re-sold. Since no land changes hand after new construction completes there is no recorded deed that includes the improvements. The price paid is known only to the builder and the buyer, not to you, me or the county assessor. We only know the price paid for the land.

    Rank City ZIP Resale 2017 $/SF New Build 2017 $/SF % New Premium
    1 Paradise Valley 85253 $334.17 $568.63 +70%
    2 Phoenix 85018 $259.12 $335.70 +30%
    3 Scottsdale 85262 $262.37 $310.37 +18%
    4 Scottsdale 85255 $267.05 $317.54 +19%
    5 Scottsdale 85251 $231.31 $338.05 +46%
    6 Scottsdale 85266 $236.39 $277.71 +17%
    7 Rio Verde 85263 $180.08 $290.16 +61%
    8 Scottsdale 85258 $228.81 $312.29 +36%
    9 Carefree 85377 $223.06 $288.92 +30%
    10 Scottsdale 85259 $222.61 $279.17 +25%
    11 Phoenix 85016 $210.01 $371.08 +77%
    12 Phoenix 85054 $207.70 $244.95 +18%
    13 Scottsdale 85260 $208.86 $323.27 +55%
    14 Scottsdale 85254 $207.72 $355.88 +71%
    15 Scottsdale 85250 $205.63 $376.80 +83%
    16 Fountain Hills 85268 $193.20 $325.01 +68%
    17 Cave Creek 85331 $185.70 $208.66 +12%
    18 Scottsdale 85257 $187.52 $252.15 +34%
    19 Phoenix 85028 $187.87 $194.51 +35%
    20 Fort McDowell 85264 $187.05 N/A N/A
    21 Phoenix 85050 $177.02 $210.09 +19%
    22 Phoenix 85032 $154.28 $255.52 +66%

    The average $/SF numbers for new homes in most of the Northeast Valley exceed re-sales by much larger percentages than in the rest of the Greater Phoenix area.

    Luxury buyers tend to be willing to pay much higher premiums for homes that fit the latest styles and fashions and for the privilege of being the first owner.

    February 19 – We are going to compare ZIP codes within a region to see which are the most expensive and most affordable and report on how much prices have changed over the past year. To do this with the greatest accuracy we will use the county recordings from Cromford Public and include all single-family, condos and townhomes. We will use the annual average $/SF for 2017 and compare with 2016.

    We will start with the Northeast Valley (including Northeast Phoenix):

    Rank City ZIP 2017 $/SF 2016 $/SF % Change
    1 Paradise Valley 85253 $367.50 $329.45 +11.5%
    2 Phoenix 85018 $271.92 $255.32 +6.5%
    3 Scottsdale 85262 $271.83 $262.16 +3.7%
    4 Scottsdale 85255 $270.80 $275.28 -1.6%
    5 Scottsdale 85251 $244.06 $230.10 +6.1%
    6 Scottsdale 85266 $242.81 $228.50 +6.3%
    7 Rio Verde 85263 $231.69 $202.32 +14.5%
    8 Scottsdale 85258 $230.78 $221.76 +4.1%
    9 Carefree 85377 $229.91 $226.34 +1.6%
    10 Scottsdale 85259 $228.52 $219.23 +4.2%
    11 Phoenix 85016 $220.25 $198.47 +11.0%
    12 Phoenix 85054 $213.80 $202.23 +5.7%
    13 Scottsdale 85260 $210.56 $199.58 +5.5%
    14 Scottsdale 85254 $208.73 $194.21 +7.5%
    15 Scottsdale 85250 $207.29 $184.63 +12.3%
    16 Fountain Hills 85268 $198.60 $190.37 +4.3%
    17 Cave Creek 85331 $191.60 $186.41 +2.8%
    18 Scottsdale 85257 $188.13 $170.60 +10.3%
    19 Phoenix 85028 $187.89 $172.32 +9.0%
    20 Fort McDowell 85264 $187.05 $201.60 -7.2%
    21 Phoenix 85050 $184.78 $180.71 +2.3%
    22 Phoenix 85032 $155.92 $145.42 +7.2%

    The average $/SF numbers for 85253, 85263 and 85016 were boosted by new homes which are often selling for much higher prices than similar sized re-sales. We will look at this phenomenon tomorrow, before we move on to other areas.

    February 18 – The market for single-family homes over $500,000 has changed quite a bit over the past year. Total sales through ARMLS were up over 25% from 460 in Jan 2017 to 576 in Jan 2018. The annual sales rate is also up significantly from 6,560 to 7,980, an increase of just under 22%. Of course, some of that increase is due to homes under $500,000 increasing in price enough to join the over $500,000 crowd.

    Supply is up, but only by 1.3%, so the days of inventory number has fallen over the past year from 266 to 221.

    Buyers still have plenty of choice over $1,000,000, but the increased sales rate means the over-supply situation is less pronounced than it was in 2016 and 2017. Average price per sq. ft. has moved very little for homes over $1 million in the past 3 years, but the outlook is improving. Over the last 3 months the sector over $2 million has seen sales rise by 45% compared with 12 months earlier. The ARMLS database shows us 84 closed sales in Nov 2017 – Jan 2018 compared with just 58 for Nov 2016 -Jan 2017.

    Above $500,000 but under $1 million, prices are showing a more favorable trend with the quarterly average sales price per sq. ft. increasing by 3% compared to a year earlier.

    February 17 – We note that the monthly median sales price for all areas and types has finally moved above the $245,000 to $248,000 zone in which it has been stuck since last June. During this same period the average price per sq. ft. has moved significantly higher but the median did not follow suit.

    The latest reading is $249,900, which is the highest point since September 2007. The monthly median is not far below its maximum level of $265,000 which was reached in June 2006. It would have to increase by just over 6% to reach that record level. Since it has increased by over 10% during the last 12 months, it is not unreasonable to expect it to achieve a new record high during the next year.

    This does NOT mean that home prices will have recovered to the levels of the housing boom of 2004-2006. The problem is that the median home being sold in 2004-2006 was smaller than the median home being sold in 2018. This means a comparison of median sales prices is unfair. In 2018 you get more home for the median sales price. Comparison of the median sales price of new versus re-sale homes is unfair for a similar reason – the median new home is much larger than the median re-sale home.

    To tell whether prices have recovered to the levels of 2004-2006 we need to study average price per sq. ft. instead. This measurement takes into account the change in the average home size.

    February 13 – January 2018 was a particularly strong month for second-home purchases in Maricopa County. We saw 15.1% of sales classified in their Affidavit of Value as owner-occupied but not primary residences. This is the highest percentage we have recorded since March 2014 and it is up from 12.2% in January 2017. After a distinct lull between 2013 and 2017, second home purchases appear to back on an up-trend.

    With investor purchase high and second-homes also high, January was a very weak month for the dominant sector – owner-occupied primary residences. These came in at just 70.0% of transactions, down from 73.9% in January 2017, 74.2% in January 2016 and the weakest percentage since January 2015.

    February 12 – Just as we observed yesterday that cash sales were strong last month, purchases by investors were also hitting a high point.

    The percentage of single-family homes in Maricopa County that were purchased by investors jumped to 13.2%. This is the highest reading we have seen since February 2016 and is up from 12.3% in January 2017.

    The investor percentage for townhouse / condo properties is almost always much higher than for single-family homes. The percentage on January 2018 was 24.1%, the highest reading since October 2016 and up from 23.1% in January 2017.

    There was a significant jump in the percentage of new homes purchased for investment in January 2018. This was 4.7% of new homes in Maricopa County which is the highest we have seen since June 2013.

    We also note that the percentage of Maricopa County sales that were attached homes increased to 17.8%. This is the highest reading since January 2015. It has not been true every month, but the market share for attached homes has been on an increasing trend in Maricopa County since April 2017. Pinal County is still dominated by single-family homes and mobile homes with relatively few townhouse or condo sales. However, these have begun to grow from a very small base as Active Adult communities in Pinal have added a few attached homes to their product mix..

    February 11 – The percentage of homes purchased with all-cash in Maricopa County was on a downward trend between February 2011 and July 2016. Since then the trend has reversed and the percentage has been gradually increasing. We suspect this is due to the increased market share by fix and flip investors and the introduction of the i-Buyers, Opendoor and OfferPad. Most flip transactions will have their first stage financed by cash. We also see cash used in many of the highest value luxury purchases as the very wealthy see no need to go through the hassle of applying for a home loan.

    You can see the percentage of homes purchased with cash in this chart.

    There is a seasonal tend with January and February usually being strong months for cash purchases and July and August being relative weak (i.e. strong for financed purchases).

    The percentage of homes purchased with all-cash in January 2018 was 25.3%, our highest observed reading since February 2015 and up from 23.4% in January last year.

    Thanks to the strong contribution from the high-end of the luxury market, the percentage of dollars from all-cash transactions was even higher at 26.7%, up from 25.5% a year ago.

    February 10 – The annual sales rate is no longer growing and has reached a plateau at just over 96,000 for all areas & types. Single-family sales are declining in the following areas, in most cases due to inadequate supply of affordable homes:

    • Anthem (peaked May 2017)
    • Apache Junction (peaked January 2018)
    • Arizona City (peaked November 2017)
    • Avondale (peaked May 2017)
    • Casa Grande (peaked June 2017)
    • Cave Creek (peaked August 2017)
    • Chandler (peaked April 2017)
    • Gilbert (peaked February 2017)
    • Glendale (peaked August 2017)
    • Goodyear (peaked April 2017)
    • Laveen (peaked July 2017)
    • Maricopa (peaked January 2018)
    • Mesa (peaked October 2017)
    • Sun City (peaked December 2017)
    • Sun City West (peaked August 2017)
    • Sun Lakes (peaked May 2017)
    • Tempe (peaked December 2017)
    • Tolleson (peaked July 2017)

    Some of these declines are very gentle, others more severe.

    New highs for the annual sales rate are still being set in the following areas:

    • Buckeye
    • El Mirage
    • Fountain Hills
    • Gold Canyon
    • Litchfield Park
    • Paradise Valley
    • Peoria
    • Phoenix
    • Queen Creek
    • Scottsdale
    • Surprise

    February 9 – Here is the table showing the Cromford® Market Index values for the single-family markets in the largest 17 cities:

    We have 11 cities showing improvement for sellers over the last month and 6 showing deterioration.

    3 cities show significant deterioration – Maricopa, Fountain Hills and Cave Creek, all 3 at the bottom of the table. In Fountain Hills, the supply index increased at the same time as the demand index fell, which is never a popular combination with sellers. It was a similar story in Cave Creek and Maricopa. Goodyear too went backwards, but the here the fall in the demand index was less significant and the main reason for the lower market index was an increase in the supply index.

    Tempe was the outstanding city for sellers this week with demand almost flat but a large decrease in the supply index. The current supply index level (52.3) is the lowest we have recorded for Tempe since June 2005. It is a tough spot for buyers right now.

    The other Southeast Valley cities also improved, though not as dramatically. Chandler`s supply index remains very low at 41.8 while the demand index increased to 96.2, its highest level since last September. It remains comfortably at the top of the table, although its CMI has not changed very much over the last 2 weeks.

    Paradise Valley improved by 9% despite an increase in its supply index. This is because its demand index has jumped to 129.3, second only to Buckeye at 132.0. Demand in Buckeye remains very strong, but it is balanced by a supply index that is the only one we see above 100 at the moment. Scottsdale also has a relatively strong demand index, but went backwards over the past month because of increasing supply.

    February 6 – Here is how the townhouse / condo annual average $/SF has changed over the past 12 months:

    1. Queen Creek +60.5%
    2. Paradise Valley +56.4%
    3. Wickenburg +33.5%
    4. Casa Grande +23.4%
    5. Arizona City +22.6%
    6. Litchfield Park +15.9%
    7. Sun City +13.7%
    8. Phoenix 12.8%
    9. Avondale +12.2%
    10. Anthem +11.6%
    11. Surprise +11.4%
    12. Mesa +11.3%
    13. Gilbert +9.7%
    14. Glendale +9.5%
    15. Apache Junction +9.3%
    16. Fountain Hills +9.2%
    17. Peoria +8.6%
    18. Chandler +8.5%
    19. Buckeye +8.3%
    20. Scottsdale +8.1%
    21. Eloy +7.8%
    22. Tempe +7.1%
    23. Florence +7.0%
    24. Maricopa +7.0%
    25. Sun City West +6.0%
    26. Cave Creek +5.2%
    27. Goodyear +5.1%
    28. Gold Canyon -0.7%
    29. Sun lakes -1.8%
    30. Carefree -2.0%
    31. Rio Verde -2.0%
    32. Youngtown -3.0%

    The top two cities were favorably influenced by new builds that were not marketed until 2017. The overall appreciation for attached homes has been stronger than for detached single family homes.

    February 4 – We have seen a very strong upward movement in average price per square foot for closed listings over the last 3 months, even though median prices have not followed through to the same extent.

    Here is how the single-family annual average $/SF has changed over the past 12 months:

    1. Coolidge +20.7%
    2. Arizona City +14.8%
    3. Wickenburg +13.7%
    4. El Mirage +12.7%
    5. Apache Junction +10.4%
    6. Avondale +9.3%
    7. Sun City +9.3%
    8. Queen Creek +8.3%
    9. Florence +8.1%
    10. Youngtown +8.0%
    11. Surprise +7.9%
    12. Casa Grande +7.8%
    13. Sun Lakes +7.8%
    14. Wittmann +7.7%
    15. Maricopa +7.5%
    16. Desert Hills +7.4%
    17. Mesa +7.3%
    18. Litchfield Park 7.3%
    19. Tolleson +7.1%
    20. Peoria +6.9%
    21. Glendale +6.8%
    22. Buckeye +6.8%
    23. Eloy +6.7%
    24. Laveen +6.2%
    25. Goodyear +5.9%
    26. Rio Verde +5.9%
    27. Phoenix +5.4%
    28. Gilbert +5.2%
    29. Chandler +5.1%
    30. Tempe +4.7%
    31. Anthem +4.2%
    32. Scottsdale +4.2%
    33. Sun City West +3.9%
    34. Cave Creek +3.5%
    35. New River +3.0%
    36. Waddell +2.7%
    37. Fountain Hills +1.4%
    38. Gold Canyon +1.1%
    39. Paradise Valley -0.2%
    40. Carefree -1.6%
    41. Tonopah -2.8%

    Pinal County and the Northwest Valley look particularly strong in this list, while the North and Northeast look relatively weak.

    You will generally find the most affordable areas at the top of the list and the least affordable towards the bottom.

    February 3 – Here are a few observations on the rental market based on the ARMLS database.

    • new rental listings are being added at a rate which is roughly 15% lower than in 2017.
    • we have seen 2,838 new listings in 2018 so far, compared with 3,298 in 2017 at the same point
    • we have 2,431 active rental listings, down from 2,726 in 2017, 2,485 in 2016, 3,712 in 2015, 5,188 in 2014 and 7,339 in 2013
    • the average asking price for active rentals is $2,021, up from $1,980 in 2017, $1,931 in 2016, $1,709 in 2015 and $1,454 in 2014
    • the latest monthly average lease rate is 87.2 cents per sq. ft., up from 84.5 cents last year, an annual increase of 3.2%
    • the average rent agreed is $1,512 per month, up from $1,465 last year, $1,405 in 2016, $1,296 in 2015, $1,251 in 2014 and $1,235 in 2013
    • the average rent agreed is 99.46% of the rent asked, little changed from 99.50% last year

    A new record high rent of $28,000 per month was recorded as signed in January for a 12,547 sq. ft. home on 46th Street in Paradise Valley.

    February 2 – The table below compares active single-family listings (excluding UCB and CCBS) for Feb 1, 2018 with Feb 1, 2017

    Price Range Active Feb 2017 Active Feb 2018 Change
    Under $100K
    120
    48
    -60.0%
    $100K-$125K
    128
    48
    -62.5%
    $125K-$150K
    328
    110
    -66.5%
    $150K-$175K
    727
    384
    -47.2%
    $175K-$200K
    1,207
    710
    -41.2%
    $200K-$225K
    895
    763
    -14.7%
    $225K-$250K
    1,101
    1,037
    -5.8%
    $250K-$275K
    874
    798
    -8.7%
    $275K-$300K
    974
    812
    -16.6%
    $300K-$350K
    1,394
    1,216
    -12.8%
    $350K-$400K
    1,286
    1,111
    -13.6%
    $400K-$500K
    1,619
    1,483
    -8.4%
    $500K-$600K
    977
    928
    -5.0%
    $600K-$800K
    1,159
    1,087
    -6.2%
    $800K-$1M
    715
    640
    -10.5%
    $1M-$1.5M
    709
    739
    +4.2%
    $1.5M-$2M
    408
    445
    +9.1%
    $2M-$3M
    385
    360
    -6.5%
    Over $3M
    326
    333
    +2.1%
    All
    15,322
    13,052
    -14.9%

    There were only 3 price ranges that increased over last year – those between $1M and $2M and over $3M.

    Of course the largest declines were at the low end below $200,000 where a long term extinction event appears to be developing. However supply dropped significantly for the lower end of the luxury sector between $500K and $1M too.

    February 1 – Let us take another look at the Cromford® Market Index for the single-family markets in the 17 largest cities:

    This is not quite a positive for sellers as in January with 5 cities showing some deterioration, although Avondale’s is very small. All cities remain above 120 and firmly in the seller`s market zone.

    The Southeast Valley cities are consolidating their dominant position at the top of the table. A huge 25% increase for Tempe has allowed it to join with Mesa, Gilbert and Chandler. All are suffering from extreme shortages of affordable supply. Queen Creek seems to be in something of a hurry to join them.

    Paradise Valley and Glendale also improved significantly for sellers over the last month.

     

    © 2018 Cromford Associates LLC

    The data used to create the Cromford® Report is obtained from public records and obtained under license from the Arizona Regional Multiple Listing Service, Inc (ARMLS). Cromford Associates LLC and ARMLS expressly disclaim and make no representations or warranties of any kind, whether express, implied or statutory, as to the accuracy of the data used or the merchantability or fitness for any particular purpose.

     

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