The Cromford Report – Daily Observations July 2017

    July 30 – The Census Bureau has not released the building permit counts for June yet. It is unusual that they are this late. However the director, John Thompson, resigned in June and no replacement has been named by the president. The deputy director, Nancy Potok, left in January and has not been replaced either. It seems that under-funding and lack of leadership may be taking its toll on the timeliness and quality of the data we receive.

    July 28 – Here is the usual table of Cromford® Market Index values for the single-family markets in the 17 largest cities by dollar volume:

    Sellers will be delighted to see only 4 cities saw deteriorating market conditions out of 17. However the city of Phoenix was one of them and it has slowly slipped backwards for some time.

    The West Valley was the primary loser over the last month with Avondale, Glendale and Buckeye getting less favorable for sellers. Surprise saw the biggest improvement out west. Buckeye is the friendliest place for buyers with its months of supply increasing from 2.3 to 2.8 over the past 30 days.

    The Northeast Valley continues to improve for sellers, particularly in Paradise Valley and Scottsdale.

    The Southeast Valley cities were all winners over the last month, particularly Queen Creek. Tempe is recovering from its slump over the past 3 months and Mesa is even starting to threaten Avondale’s now traditional place at the top of the table.

    July 27 – The Case-Shiller® Home Price Index® report issued July 25 is now reflected in the Case-Shiller chart on the Cromford Report. The latest index reflects sales between March and May 2017. The ranking based on month to month changes is as follows:

    1. Seattle 1.79%
    2. Las Vegas 1.35%
    3. Cleveland 1.30%
    4. Portland 1.26%
    5. Tampa 1.12%
    6. Los Angeles 1.05%
    7. Detroit 1.04%
    8. San Diego 1.02%
    9. Minneapolis 1.01%
    10. Washington DC 1.01%
    11. Chicago 0.98%
    12. Atlanta 0.93%
    13. Charlotte 0.92%
    14. Denver 0.92%
    15. Miami 0.81%
    16. Boston 0.79%
    17. Dallas 0.70%
    18. Phoenix 0.62%
    19. San Francisco 0.50%
    20. New York 0.15%

    Phoenix slipped from 14th to 18th place over the last month and was a long way behind the national figure of 0.98%.

    Based on year over year changes in the HPI we see:

    1. Seattle 13.31%
    2. Portland 8.90%
    3. Denver 7.89%
    4. Dallas 7.77%
    5. Detroit 7.57%
    6. Las Vegas 6.93%
    7. Tampa 6.77%
    8. San Diego 6.58%
    9. Boston 6.13%
    10. Charlotte 6.05%
    11. Phoenix 5.73%
    12. Minneapolis 5.73%
    13. Los Angeles 5.59%
    14. Cleveland 3.58%
    15. Atlanta 5.48%
    16. San Francisco 5.37%
    17. Miami 5.28%
    18. New York 4.01%
    19. Washington DC 3.59%
    20. Chicago 3.34%

    The prediction last November by Realtor.com that Phoenix would be the hottest market in the US in 2017 is now looking on very shaky ground. At number 11 out of 20, we are very close to the national average at 5.58%

    July 26 – Yesterday we ranked the top ten cities by home sales, but the picture is very different if we only look at homes in Active Adult communities – Age Targeted or Age Restricted:

    1. Sun City – 2,468
    2. Mesa – 1,635
    3. Sun City West – 1,617
    4. Buckeye – 1,003
    5. Surprise – 902
    6. Peoria – 778
    7. Sun Lakes – 633
    8. Goodyear – 509
    9. Tucson – 373 (Saddlebrooke & Eagle Crest Ranch are in Pinal County)
    10. Chandler – 273

    San Tan Valley & Florence are bubbling under the top ten but Phoenix and Scottsdale do not make the top 10 when it comes to 55+ sales.

    These statistics are taken from our Cromford® Public charts.

    July 25 – In term of home sales, the top ten cities rank as follows over the past 12 months, according to recorded deeds in Maricopa & Pinal Counties:

    1. Phoenix – 29,039
    2. Mesa – 12,846
    3. Scottsdale – 9,867
    4. Gilbert – 7,775
    5. Chandler – 7,012
    6. Peoria – 6,001
    7. Glendale – 5,751
    8. Surprise – 4,586
    9. San Tan Valley – 4,345
    10. Buckeye 3,562

    Glendale has slipped in this table over the last decade, overtaken by the faster-building Gilbert, Chandler & Peoria. San Tan Valley & Buckeye have overtaken Avondale, Tempe & Goodyear, again because of their fast intake of new homes.

    We note that San Tan Valley is not really a city, just an unincorporated part of Pinal County with its future role as a city in the hands of its much smaller neighbors: Queen Creek, Florence and (to a lesser extent) Apache Junction.

    July 24 – For some strange reason a few media outlets are reporting a rise in Canadian purchases of US real estate as if this is some big new trend. No, purchases by Canadians in Maricopa County are still dismal, just not quite as low as last year. Here are the totals for June in the last 7 years:

    • 2011 = 421
    • 2012 = 326
    • 2013 = 185
    • 2014 = 126
    • 2015 = 70
    • 2016 = 36
    • 2017 = 44

    Seen in this context it would have been surprising if they had dropped even lower than the 36 we saw last year, but it would be a mistake to get excited about a 22% increase when it it is still the second lowest total in the last 7 years.

    There were 150 Maricopa home sales by Canadians in June, more than 3 times the number of purchases, so we still have an exodus going on. However last year we saw 244 sales so the outward migration by our hockey-loving friends is slowing down.

    July 23 – Although the monthly average price per sq. ft. is declining slowly at the moment (in line with normal seasonal trends), the annual rate of appreciation, as measured by the 12 month change in the monthly average $/SF, has just hit 8% for the first time since May 2014. Clearly the monthly average fell faster during the 3Q of 2016 than it is falling in the 3Q of 2017.

    All of the above data refers to the numbers for all areas & types within the ARMLS database.

    July 22 – So much for the idea that homes are getting smaller. The annual average home size of homes sold as of today is 1,967 sq. ft. This higher than all but one of the readings on this date in the last 16 years.

    Back in 2002 we saw an average of only 1,762 sq. ft.

    July 21 – We often complain about the measurement “Months of Supply” because it can be dramatically affected by seasonal factors. This is why we usually prefer “Days of Inventory” instead, which is based on the annual sales rate instead of the volatile monthly sales rate. However if we are comparing a number of geographic areas with each other at a fixed point in time, the Months of Supply is a perfectly valid tool and has the advantage of of reflecting the market as it was in the most recent month rather than the last 12 months.

    So let us compare selected areas based on their Months of Supply as of yesterday and for added interest let us take a look at what the number was this time last year. In the table below we are going to exclude UCB and CCBS listings since although they are still technically active, we find that 65% of these listings are no longer being marketed in the real world (only on Zillow). We are including all property types in the numbers below.

    Rank Area ZIP Codes Months of Supply 2016 Months of Supply 2017 Supply higher than last year Large reduction since last year
    1 West Mesa 85201 85202 85203 85210 1.1 1.0
    2 Sun City & Sun City West 85351 85373 85375 1.4 1.0 yes
    3 El Mirage & Youngtown 85335 85363 0.9 1.0 yes
    4 South Peoria 85345 85381 1.2 1.1
    5 Avondale 85323 85392 1.0 1.1 yes
    6 North Chandler 85224 85225 85226 1.3 1.2
    7 Maryvale & Far West Phoenix 85031 85033 85033 85037 1.3 1.2
    8 South Glendale 85301 85303 85305 85307 1.6 1.2 yes
    9 San Tan Valley 85140 85143 1.5 1.2
    10 North Gilbert 85233 85234 85295 85296 1.4 1.3
    11 Laveen & Tolleson 85339 85353 1.8 1.3 yes
    12 East Mesa 85204 85206 85208 85209 85212 1.6 1.3
    13 Tempe 85281 85282 85283 85284 2.0 1.4 yes
    14 North Glendale 85302 85304 85306 85308 85310 1.6 1.4
    15 I17 & 101 85022 85023 85024 85027 85053 1.5 1.4
    16 Inner West Phoenix 85009 85015 85017 85019 1.5 1.4
    17 South & SW Phoenix 85040 85041 85042 84043 1.5 1.6 yes
    18 Northwest Phoenix 85021 85029 85051 1.7 1.6
    19 South Chandler & Sun Lakes 85248 85249 85286 2.5 1.6 yes
    20 South Gilbert 85297 85298 1.8 1.6
    21 Apache Junction 85119 85120 2.7 1.7 yes
    22 Northeast Mesa 85205 85207 85213 85215 2.4 1.7 yes
    23 Queen Creek 85142 2.2 1.7 yes
    24 51 Corridor 85020 85028 85032 2.1 1.7
    25 South Surprise 85374 85378 85379 85388 1.8 1.7
    26 Litchfield Park & Waddell 85340 85355 2.6 1.8
    27 Sky Harbor North 85006 85008 85034 2.0 1.8
    28 Maricopa 85138 85139 2.0 2.0
    29 South Scottsdale 85250 85251 85257 2.6 2.1
    30 North Surprise & Wittmann 85361 85387 1.7 2.1 yes
    31 North Peoria 85382 85383 2.5 2.2
    32 Florence & Coolidge 85128 85132 4.9 2.2 yes
    33 Buckeye 85326 85396 2.3 2.4 yes
    34 Goodyear 85338 85395 2.0 2.4 yes
    35 Central Scottsdale 85254 85258 85260 3.2 2.4 yes
    36 North Phoenix 85083 85085 2.4 2.5 yes
    37 Uptown Phoenix 85012 85013 85014 2.4 2.6 yes
    38 Ahwatukee 85044 85045 85048 2.2 2.6 yes
    39 Anthem & New River 85086 85087 4.0 2.6 yes
    40 Casa Grande Area 85122 85123 85131 85193 85194 3.1 2.8
    41 Biltmore & Arcadia 85016 85018 3.3 2.9
    42 Cave Creek & Carefree 85331 85377 5.4 4.0 yes
    43 Gold Canyon 85118 5.3 4.0 yes
    44 Tonopah 85354 4.7 4.7
    45 Downtown Phoenix 85003 85004 85007 4.3 5.1 yes
    46 North Scottsdale 85255 85259 85262 85266 6.5 5.5 yes
    47 Fountain Hills & Rio Verde 85263 85268 4.4 6.2 yes
    48 Paradise Valley 85253 13.9 7.5 yes
    49 Wickenburg 85390 10.9 9.2 yes

    There are 11 areas with more months of supply than a year ago. There are 16 areas with a large reduction since last year.

    The most dramatic improvement can be seen in Florence and Coolidge. Anything below 2 months is evidence of a serious shortage of supply.

    July 20 – The table below shows the Cromford® Market Index today and one month ago for the single-family markets in the largest 17 cities by dollar volume:

    There is one more city showing deterioration than last week, but I would still call this a very favorable table for sellers, especially those in the Northeast Valley.

    All but one of the deteriorating cities declined by only 2% or less, with only Glendale taking a hit of 6%.

    Among the improving cities for sellers we have several with significant advances:

    1. Cave Creek – up 9%
    2. Paradise valley – up 9%
    3. Scottsdale – up 8%
    4. Surprise – up 8%
    5. Queen Creek – up 7%
    6. Maricopa – up 5%
    7. Mesa – up 5%

    Every city is in the seller`s market zone over 110

    July 19 – There has not been a lot of change in the data coming from the Ellie Mae Origination Report over the last few months. However the following trends have taken place:

    • The percentage of refinance loans has dropped sharply from 47% in January to 32% in June. This means purchases loans are even more dominant in the market at 68% last month.
    • Purchase loans are particularly dominant in the FHA sector. They comprise 81% of loans.
    • FHA has 22% market share with Conventional at 64%, VA at 10% and Other at just 4%.
    • The average purchase loan is taking 43 days to close, down from 46 days in June 2016.
    • Interest rates have been falling slowly since April, down from 4.4% to 4.27% for a 30 year loan.
    • VA rates remain lower than the overall market at 4.01%for a 30 year fixed loan, though this is higher than a year ago when it stood at 3.84%

    July 17 – Well folks, it`s started. The annual price decline during the third quarter is underway as usual. Take a look at the daily chart for the monthly average price per sq. ft. We currently see the lowest reading in the last 2 months.

    This does not mean that prices are really on a downward trend. It is a phenomenon caused by the significant fall-off in luxury home activity during the summer months. Since the regular market maintains more of its momentum, the average price and average $/SF both take a temporary hit until luxury home buyers return in greater volume in October. You can see this happen every year but some years the effect is drastic and in others it is a little muted. It always shows up in some form however.

    July 15 – Probably the simplest and most useful indicator for the housing market is the Days of Inventory. This is the total number of active listings divided by the annual sales rate and multiplied by 365 to convert from years to days. This is not to be confused with the Average Days of Market which is one of the least useful indicators that is widely quoted but imparts little sense of market direction since it is a trailing indicator. Days of Inventory works in reverse (the lower the number the hotter the market) but is a leading indicator that is very useful for those wanting to know the direction of prices over the short term future.

    Right now the Days of Inventory for the entire ARMLS database stands at 86. It was lower than this between April 2004 and November 2005 and between March 2012 and September 2012 and also between May and August 2013. However it is currently the lowest since August 2013 and well down from July 2016 when we saw 105.

    The long term average is 149 and a figure of 86 confirms we are in a strong seller`s market but not at extreme levels. Between July 2004 and September 2005 we were below 60 which corresponded to the top of the bubble. The sharp increase from 31 in March 2005 to 67 in October was a reliable indication of the bubble popping.

    Our favorite chart for Days of Inventory across the entire market is the weekly one.

    July 14 – This week we will also rank the rest of the secondary cities by their Cromford® Market Index (single-family only)

    1. Arizona City 266.3 (down from 317.4 last month)
    2. El Mirage 215.2 (down from 233.3 last month)
    3. Apache Junction 205.1 (up from 195.0 last month)
    4. Sun Lakes 181.0 (up from 136.2 last month)
    5. Tolleson 179.2 (up from 175.1 last month)
    6. Anthem 172.3 (up from 140.1 last month)
    7. Sun City 169.4 (up from 140.2 last month)
    8. Gold Canyon 153.0 (up from 122.3 last month)
    9. Casa Grande 150.2 (up from 143.7 last month)
    10. Sun City West 150.1 (up from 122.1 last month)
    11. Litchfield Park 136.7 (up from 125.4 last month)
    12. Laveen 125.1 (up from 122.8 last month)

    Only 2 of these 12 cities showed any deterioration and these two were already at the head of the table. Both have added to supply over the last month whereas the story in the majority of these cities is a significant fall in active listings. This is particularly true for those that cater to the active adult and snowbird buyers. These tend to have fewer buyers during the summer, but they also see a huge drop in active listings. Because of the big drop in competition from other sellers, the summer is still a good time to have your home listed in these locations.

    We note that every one of these 12 cities is in a seller`s market above 110.

    July 13 – Another look at the Cromford® Market Index for the single-family markets in the 17 largest cities by dollar volume:

    This week we see only 5 cities with lower readings than one month earlier and 12 showing improvement from a seller`s perspective.

    The biggest winners are in the Northeast Valley – Cave Creek at 17%, Scottsdale at 9% and Paradise Valley at 8%, although Surprise and Queen Creek are not far behind.

    Mesa seems to be outperforming its sister cities in the Southeast while Avondale remains at number one as it has for what seems like an eternity.

    This is a very good looking table for sellers with only Glendale and Chandler holding out a tiny olive leaf for buyers.

    July 12 – The luxury market over $500,000 has been under-performing the general market across the whole of the USA. In Greater Phoenix prices have not moved upwards as much as the market below $500,000 and in some places have declined slightly over the past 2 years. However the positive trends that we reported yesterday for the Northeast Valley are also impacting the luxury market as a whole.

    For single family detached homes over $500,000, the annual sales rate has increased from 6,054 to 7,259 over the past 12 months. That is an increase of almost 20%, ahead of the rest of the market which has been partly constrained by low supply. Supply is not a problem at the top end, down just 0.6% between July 1, 2016 and July 1, 2017. However a higher sales rate with no increase in available supply is still good news for sellers and the number of days of inventory has dropped from 279 to 232. Average days on market for closed homes has come down from 142 to 136, unspectacular but still moving in the right direction from a seller`s perspective.

    If we compare average price per sq. ft. for the second quarter with the same period in 2016, we find the following areas performed best (homes over $500K only):

    • Scottsdale 85251 – up 10%
    • Scottsdale 85254 – up 9%
    • Gilbert 85298 – up 9%
    • Scottsdale 85258 – up 8%

    July 11 – The Northeast Valley has under-performed the rest of Greater Phoenix for the last 2 years but is now showing some encouraging signs. The annual single-family sales rate has increased from 6,508 to 7,009 since July 2016, a rise of 8%, while the number of active listings (excluding UCB & CCBS) has declined by 11%. This combination means that days of inventory have fallen from an above average 201 to a below average 168. This is good for sellers.

    When days of inventory readings are below average we tend to see appreciation show up. Comparing the second quarter that has just finished with last year`s second quarter, the average price per sq. ft. for single-family homes is up 6.5%, the best result for any quarter in the last 2 years. Even homes over $1 million are up by 4.9%.

    The effect is not uniform by geography however. It is the south and central parts of Scottsdale that have seen the strongest price trends. Again comparing 2Q 2016 with 2Q 2016, we see:

    • 85250 up 15%
    • 85251 up 12%
    • 85257 up 10%
    • 85254 up 9%
    • 85258 up 9%
    • 85260 up 6%

    Not so good are:

    • 85268 down 2%
    • 85377 down 2%
    • 85255 down 2%

    However parts of the far north have bounced back a bit after a dismal time in 2016.

    • 85266 up 8%
    • 85262 up 5%

    The most positive sign is that supply is down from last year and that sales rates are now high enough to avoid the excesses of supply that we experienced in 2016. Sellers must hope that these sales rates can be maintained.

    Existing owners are still down-sizing, but retiring baby boomers from out of state seem to be arriving to take their place in sufficient numbers.

    July 9 – Average rental rates continued to climb for single-family detached homes over the past 3 months, reaching 84 cents per square foot per month during June. This calculation is based on leases closed through ARMLS, which is obviously not the majority of the market but represents a substantial sample with 1800 leases closed during June. This price is up 5% from last year and 15% from two years ago.

    The picture is not so positive for townhouse / condo rentals, where price increases have stalled. These tend to rent for substantially more than detached homes on a square foot basis, with the average rent in June being $1.05 per square foot per month. This represents no increase over June 2016 though it is up 5% from two years ago.

    Apartment-style rentals achieved $1.12 per square foot during June, down from $1.20 a year ago and landlords seem to have lost pricing power for this particular dwelling style. They are up less than 1% from two years ago.

    It is interesting that single family homes are becoming cheaper relative to attached homes when purchased (on a square foot basis) but are moving closer in price to attached homes when leased (though they remain substantially cheaper to rent per sq. ft.).

    July 8 – The monthly spreadsheet that we publish based on initial analysis of the Maricopa County recordings has been posted here.

    This is compiled by Tom Ruff of the Information Market and for this month he has introduced a new format. As well as the median he has computed the low and high quartiles for prices for new homes, re-sales and the combination of the two.

    Total sales for June came in at 11,230, down only slightly from the May number. New home sales hit 1,439, the highest total since December.

    The overall median sales price is up 5.8% from June 2016 to $254,000. This is similar to our measurement in August 2007 and just 4.7% shy of the maximum of $266,523 that we measured in June 2006.

    The new home median is up only 2.1% from a year ago while the re-sale median is up 4.8% to $240,000.

    July 6 – Let us take another look at the Cromford® Market Index for the single-family markets in the 17 largest cities by dollar volume:

    This is a pretty picture for sellers with 12 cities showing higher CMI readings than last month and only 5 lower. Mind you, the latter includes Phoenix, Chandler, Glendale and Gilbert, 4 of the 6 largest cities.

    Chandler deteriorated the most (down 6%) while the largest improvements can be seen in Cave Creek, Scottsdale, Queen Creek and Surprise. The Northeast Valley is looking brighter for sellers than it has for a very long time, with inventory down compared to last year and a healthy increase in sales volumes.

    We should also point out that all 17 cities are now in the seller`s market zone over 110.

    July 5 – Yesterday we looked at the lower ranks of the luxury home market from $500,000 to $1,500,000 and the positive trends that are emerging. Today we are taking a look at the upper echelons from $1,500,000 upwards.

    Let`s first take a look at the active listing numbers for single-family detached homes:

    Price Range Active Listings excl. UCB/CCBS July 2015 Active Listings excl. UCB/CCBS July 2016 Active Listings excl. UCB/CCBS July 2017 Change in Last 12 Months
    $1.5M – $2M 303 357 362 +1%
    $2M – $3M 306 303 320 +6%
    Over $3M 204 253 241 -5%

    We have still see a lot more active listings (not under contract) than 2 years ago, and more than last year between $1.5M and $3M, but we also see a decrease from last year for the range over $3M.

    As before, we have to place inventory in the context of the sales rate, so let`s look at the annual sales rates for the same time periods.

    Price Range Annual Sales Rate July 2015 Annual Sales Rate July 2016 Annual Sales Rate July 2017 Change in Last 12 Months
    $1.5M – $2M 259 285 294 +3%
    $2M – $3M 191 193 202 +5%
    Over $3M 106 84 125 +49%

    Here we see an increase in the sales rate for homes over $3Mover the past year. However the sales gains between $1.5M and $3M are relatively weak, especially in the context of rising inventory.

    Once again, dividing the active listing count by the annual sales rate gives us the days of inventory when multiplied by 365:

    Price Range Days of Inventory July 2015 Days of Inventory July 2016 Days of Inventory July 2017 Change in Last 12 Months
    $1.5M – $2M 427 457 449 -2%
    $2M – $3M 585 573 578 +1%
    Over $3M 702 1,099 704 -36%

    From a seller`s perspective the lack of any significant drop in days of inventory between $1.5M and $3M is bad news. However the situation over $3M is similar to mid-2015 and thus a big improvement over the state of play in mid-2016.

    Price Range Annual Avg $/SF July 2015 Annual Avg $/SF July 2016 Annual Avg $/SF July 2017 Change in Last 12 Months
    $1.5M – $2M $316.86 $317.10 $308.25 -2.8%
    $2M – $3M $383.82 $374.73 $383.34 +2.3%
    Over $3M $552.16 $558.04 $562.31 +0.8%

    The least fortunate price range is that between $1.5M and $2M.

    The range between $2M and $3M has done rather better over the past 12 months but is still priced below 2 years ago.

    The range over $3M has made some progress, albeit very modest in percentage terms.

    The price increases are very modest so far, but show signs of acceleration over the past few months. You can see this is the annual average $/SF charts for Scottsdale

    July 4 – The price range from $500,000 to $1,500,000 appears to be emerging from the doldrums. Ever since the summer of 2015, this sector of the market has under performed the lower price ranges in terms of price appreciation. However sales volumes have increased substantially in 2017 and have now started to make a significant dent in the inventory. This is encouraging news for sellers and means buyers have lost much of the bargaining power they enjoyed over the past 2 years.

    Let`s take a look at the numbers for single-family detached homes:

    Price Range Active Listings excl. UCB/CCBS July 2015 Active Listings excl. UCB/CCBS July 2016 Active Listings excl. UCB/CCBS July 2017 Change in Last 12 Months
    $500K – $600K 949 1,128 1,003 -11%
    $600K – $800K 1,020 1,145 1,138 -1%
    $800K – $1M 556 706 632 -10%
    $1M – $1.5M 533 629 597 -5%

    We have still more active listings (not under contract) than 2 years ago, but we also see a healthy decrease from last year (though this is only small in the case of $600K to $800K).

    We have to place inventory in the context of the sales rate, so let`s look at the annual sales rates for the same time periods.

    Price Range Annual Sales Rate July 2015 Annual Sales Rate July 2016 Annual Sales Rate July 2017 Change in Last 12 Months
    $500K – $600K 1,796 2,164 2,625 +21%
    $600K – $800K 1,632 1,920 2,261 +18%
    $800K – $1M 702 858 994 +16%
    $1M – $1.5M 636 603 760 +26%

    Here we see some impressive increases in the sales rate over the past year. We also see gains between 2015 and 2016 except for the range $1M to $1.5M

    Dividing the active listing count by the annual sales rate gives us the days of inventory when multiplied by 365:

    Price Range Days of Inventory July 2015 Days of Inventory July 2016 Days of Inventory July 2017 Change in Last 12 Months
    $500K – $600K 193 190 139 -27%
    $600K – $800K 228 218 183 -16%
    $800K – $1M 289 300 232 -23%
    $1M – $1.5M 306 381 287 -25%

    From a seller`s perspective these significant drops in days of inventory are good news, which is likely to translate into upward pricing pressure, something that has been largely absent until recently.

    Price Range Annual Avg $/SF July 2015 Annual Avg $/SF July 2016 Annual Avg $/SF July 2017 Change in Last 12 Months
    $500K – $600K $170.85 $171.30 $174.95 +2.1%
    $600K – $800K $195.52 $197.00 $198.86 +0.9%
    $800K – $1M $218.23 $223.78 $224.77 +0.4%
    $1M – $1.5M $259.95 $258.52 $262.15 +1.4%

    The price increase are very modest so far, but show signs of acceleration over the past few months. You can see this is the annual average $/SF charts for Scottsdale.

    July 3 – The most recent S&P / Case Shiller® Home Price Index® report was issued on June 27 and the last index reading covers sales between February and April 2017. The month to month changes look like this:

    1. Seattle 2.63%
    2. Portland 1.86%
    3. San Francisco 1.48%
    4. Atlanta 1.41%
    5. Las Vegas 1.36%
    6. Minneapolis 1.32%
    7. Detroit 1.29%
    8. Denver 1.28%
    9. Washington DC 1.20%
    10. Charlotte 1.06%
    11. Dallas 1.05%
    12. Chicago 1.03%
    13. San Diego 0.93%
    14. Phoenix 0.84%
    15. Los Angeles 0.72%
    16. Miami 0.56%
    17. Boston 0.49%
    18. New York 0.31%
    19. Tampa 0.03%
    20. Cleveland -0.06%

    Phoenix remains in the lower half of the pack and is appreciating less quickly than the national average, which gained 0.95% between the May and June reports.

    The year over year movements were as follows:

    1. Seattle 12.9%
    2. Portland 9.3%
    3. Dallas 8.4%
    4. Denver 8.2%
    5. Detroit 7.4%
    6. Las Vegas 6.8%
    7. Boston 6.7%
    8. San Diego 6.6%
    9. Minneapolis 6.3%
    10. Charlotte 6.1%
    11. Atlanta 5.8%
    12. Phoenix 5.7%
    13. Miami 5.4%
    14. Los Angeles 5.3%
    15. Tampa 5.0%
    16. San Francisco 5.0%
    17. Chicago 4.0%
    18. New York 3.8%
    19. Washington DC 3.6%
    20. Cleveland 3.4%

    Phoenix is just a shade stronger in the year over year table, but still below the mid point. However it is slightly above the national average of 5.5%.

    July 2 – There were a total of 799 multi-family permits issued in May 2017 within Maricopa and Pinal Counties. This is a very similar number of units to March and April, but it slightly down from May 2016, when there were 1,002.

    The 12 month rolling average is still very high at 10,384, The all-time record is 10,787 in June 2006. Despite rumors of a slow down in multi-family construction, there is no evidence of one in the permit counts. However the locations are changing in favor of less expensive areas. This month we see a big contribution from Goodyear and nothing at all from Tempe or Scottsdale.

    Year to date at the end of May we have seen 3,471 units across Maricopa and Pinal Counties. This is up 27% from 2016.

    For 2017 year-to-date we see the following counts by geographic area:

    1. Phoenix 1,115
    2. Mesa 568
    3. Glendale 471
    4. Chandler 417
    5. Peoria 357
    6. Goodyear 326
    7. Surprise 135
    8. Pinal County 50
    9. Paradise Valley 12
    10. Scottsdale 10

    Scottsdale and Tempe have gone very quiet but the West Valley has woken up.

    July 1 – According to the US Census Bureau, there were 1,997 single family permits issued during May 2017. This is the largest monthly total since August 2007, almost 10 years ago.

    The count is up 20% from May 2016 and pushes the annual rate up to 19,236, up 7% from 17,976 twelve months ago.

    For 2017 year to date, the top ten geographic areas for single family permits have been:

    1. Mesa 1,164
    2. Phoenix 1,018
    3. Buckeye 859
    4. Unincorporated Pinal County – 856
    5. Gilbert – 775
    6. Peoria – 764
    7. Queen Creek – 512
    8. Goodyear – 503
    9. Maricopa – 494
    10. Scottsdale – 311

    Given that the 856 permits for Unincorporated Pinal County are mostly in the San Tan Valley area, the 3 ZIP codes 85140, 85142 and 85143 are very strongly represented when we add in the 512 for the Town of Queen Creek to make 1,368 in total..

     

    © 2017 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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