Market Data - July 2018
We are looking at single family homes priced from $500,000 upwards in all areas of the Northeast Valley, including Scottsdale, Paradise Valley, Fountain Hills, Rio Verde, Arcadia, Biltmore, Cave Creek and Carefree.
On July 1st, 2018 we had 2,655 active listings over $500,000. This is an 11% decrease from last month. We have 4% fewer listings than we saw on July 1st, 2017. Luxury listings are still in relatively good supply compared with the rest of market. However, we have seen reductions over the past two years and the supply trend is now moving clearly downwards rather than up as it was between 2014 and 2016. The price-range from $1.5 million to $2 million is up 7% and homes over $3 million are up 3%, so not every price range is falling year-over-year. That between $600,000 and $800,000 is down the most since last year, dropping by 9%. 98% of active listings are normal with 36 short sales and thirteen lender-owned properties. Normally luxury listing counts peak at the beginning of April and decline until September and 2018 looks is following the usual pattern so far.
Demand – Sales
June 2018 gave us 534 closed transactions though ARMLS. This is an 8% rise from June 2017, when we saw 504, and June had the disadvantage of ones less working day in 2018 than in 2017. It is the second highest June total in history for the Northeast Valley luxury market, but well short of the previous record of 640 in 2005. We have now experienced seven very strong sales months in a row, though June was not quite in the same league as the previous six. Every price range saw an increase over June 2017 except for $800,000 to $1 million. The sector with the highest increase over last year was that over $3 million, up over 36% from eleven to fifteen. The range from 41 million to $1.5 million also increased over 36% and hit a new record high of 98.
Demand – Under Contract
We can anticipate future sales by looking at homes under contract. We started July 2018 with 634 listings under contract, which is up 13% from the 562 of July 1st, 2017. This is a slightly larger percentage increase than last month and suggests that year over year sales growth will continue into July and August. All price ranges saw increases compared to last year, except for the range over $3 million, which dropped from 20 to 18. Normal sales comprise 96% of luxury homes in escrow, down from 98% last year.
Due to relatively low volumes and a wide range of price points, the Northeast Valley luxury market can display a lot of volatility if measured on a monthly basis. We therefore prefer to measure over a longer period in order to identify trends more accurately. Since the market low of $219 in 1Q 2012 we have seen the twelve-month average move upwards to around $276 per sq. ft. which is an increase of 26%. Luxury home pricing first peaked in August 2015 when the twelve-month average price per sq. ft. hit $269 and finally exceeded that level six months ago. The twelve-month average currently stands at $276, up 3% from $269 in June 2017. The six-month average has climbed to $285, up from $272 in June 2017 and the three-month average stands at $285, up from $273 in June 2017.
Overall luxury pricing has established a rising price trend again over the last six months, having moved sideways between 2015 and 2017. However, there was very little change between May and June 2018.
Under Contract Pricing
We have seen a rise in sales pricing over the past twelve months. However, under contract pricing is showing a decline over the past month, so we may see some weakness in sales pricing next month. This is a common seasonal pattern.
The average under contract price for normal listings is $278 per sq. ft. The average for (the very few) lender owned homes is $192 per sq. ft and short sales average $204 per sq. ft.
Area Reports - July 2018
Although we publish montly reports for the following five communities, we track sales in all areas of the Northeast Valley. If you have questions about a specific area that is not covered in the areas below, please call us at 480-991-2050 and we can provide you with up-to-date market information.