Market Data - March 2017
We are looking at single family homes price 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 March 1, 2017 we have 3,500 active listings over $500,000. This is 7% more than the 3,280 we saw last month. Luxury listing counts have increased at a much faster pace than the rest of market. However this total represents 3% fewer listings than we saw in March 2016. We expect supply to continue to rise for only 1 more month, peaking during March or at the beginning of April. 99% of active listings are normal with 36 short sales and 16 lender-owned properties. The increase in supply was consistent across all price ranges, but supply for the range above $2 million is now above the level of April 2016 so is setting a new record high since the housing crash.
Demand – Sales
There were 276 closed transactions though ARMLS during February 2017. This is a very slightly ahead of February 2016, when we saw 273, but given that overall sales were up 12%, a 1% rise in luxury sales was weak in comparison. Nevertheless it is still the highest February total since 2007. All the ranges above $1 million were down compared to 2016 and it was the range between $500,000 and $1 million that performed well, up 12%, like the overall market. In fact sales over $1 million were down 20% compared to February 2016, which is unusual, given the strength we have seen in the stock market. Sales between $1 million and $2 million were the lowest we have seen in February since 2011.
Demand – Under Contract
We can anticipate future sales by looking at homes under contract. The number of listings under contract was 595 as of March 1, which is up an impressive 14% from the 522 of March 1, 2016. However, once again it is the lower end of the luxury range that is doing all the heavy lifting. Homes between $500,000 and $800,000 have a 28% gain in listings under contract, but above $800,000 there is a 3% decline. For homes over $3 million there was even a 33% decline. Normal sales comprise 96% of luxury homes in escrow, up from 94% a year ago.
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 12 month average move upwards to around $267 per sq. ft. which is an increase of 22%. However luxury home pricing peaked in August 2015 and had been in a bit of a slump until last fall. However pricing has strengthened since October and we are seeing some year over year increases. The 12 month average pricing is $2 higher than a year ago in February 2016. The six month moving average stands at $272, up from $265 in February 2016. However the 3 month average stands at $273, which is down $5 from February 2016.
Under Contract Pricing
The pricing for homes under contract was at a low point of $165 per sq. ft. in September 2011. Up to the end of March 2014 it was advancing and reached a peak of $257. Between March 2014 and March 2017 it has made no consistent moves in either direction and as of March 1, 2017, the average still stands at $251, $1 lower than last year. This suggests that sales prices will continue to move sideways in the near future. If the sales mix continues to favor the lower priced homes, as it did in February, then we could see a slight fall in the average price per sq. ft. The average under contract price for normal listings is $255 per sq. ft. The average for (the very few) lender owned homes is $252 per sq. ft and short sales average $170 per sq. ft.
Area Reports - March 2017
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.