Market Data - June 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 June 1st, 2018 we had 2,987 active listings over $500,000. This is a 9% decrease from last month. We have 6% fewer listings than we saw on June 1st, 2017. Luxury listings are still in 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 downwards rather than up as it was between 2014 and 2016. The price-range from $1.5 million to $2 million is up 4% and homes over $3 million are up 5%, so not every price range is falling. That between $600,000 and $800,000 is down the most since last year, dropping by 13%. 98% of active listings are normal with 39 short sales and fifteen lender-owned properties. Normally luxury listing counts peak at the beginning of April and decline until September and 2018 looks like following the same pattern.
Demand – Sales
May 2018 gave us 590 closed transactions though ARMLS. This is a strong 17% rise from May 2017, when we saw 504. It is also by far the highest May total in history for the Northeast Valley luxury market, exceeding the previous record of 543 in 2005. We have now experienced six very strong sales months in a row. Every price range saw an increase over May 2017 except for $800,000 to $1 million. The sector with the highest increase over last year was $2 million to $3 million, up over 123% from 17 to 38, a new record for May sales.
Demand – Under Contract
We can anticipate future sales by looking at homes under contract. We started June 2018 with 750 listings under contract, which is up 11% from the 675 of June 1st, 2017. This is a smaller increase than last month but still suggests that year over year sales growth will continue into June and July. All price ranges saw increases compared to last year, with the exception of that between $600,000 and $800,000, which was flat. The demand at the high end is far stronger than in 2017 with listings under contract up 39%. Normal sales comprise 97% 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 $268 in May 2017. The six-month average has climbed to $285, up from $272 in May 2017 and the three-month average reached $286, up from $273 in May 2017.
Overall luxury pricing has established a rising price trend again over the last 6 months, having moved sideways between 2015 and 2017.
Under Contract Pricing
We have seen a rise in sales pricing over the past twelve months. However, under contract pricing is showing a slight decline over the past month, so we may see slight weakness in sales pricing next month. This is a common seasonal pattern.
The average under contract price for normal listings is $283 per sq. ft. The average for (the very few) lender owned homes is $196 per sq. ft and short sales average $206 per sq. ft.
Area Reports - June 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.