Market Data - November 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.

Supply

On November 1st, 2018 we had 2,619 active listings over $500,000. This is an 8% increase from last month but 12% fewer listings than we saw on November 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. This downward trend has also gained momentum over the past few months. All price ranges are seeing a reduction compared with last year, ranging from -22% for $500,000 to $600,000 to -1% for over $3 million. 99% of active listings are normal with 25 short sales / pre-foreclosures and twelve lender-owned properties. Normally luxury listing counts are stable during November, decline during December and then grow strongly between January and April and we have no reason to believe this year will be any different.

Demand – Sales

October 2018 gave us 382 closed transactions though ARMLS. This is up 19% from October 2017, when we saw 322. It reverses the weakness we saw last month and looks more like the prior nine strong ones.  All price ranges saw an annual increase over October 2017 except for homes over $3 million which eased from eight to seven. The range from $1,500,000 to $2,000,000 was particularly busy, jumping from twelve to 28.

Demand – Under Contract

We can anticipate future sales by looking at homes under contract. We started November 2018 with 518 listings under contract, which is down 10% from the 574 of November 1st, 2017. This suggests that year over year sales growth is likely to be weaker in November and December. Most of the weakness is concentrated in the low end from $500,000 to $600,000, down 28% from 125 to 90. The range from $1 million to $3 million is looking stable, up from 156 to 160. The price range over $3 million dropped from 26 to 17. Normal sales comprise 96% of luxury homes in escrow, down from 97% last year.

Sales Pricing

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 $280 per sq. ft. which is an increase of 28%. Luxury home pricing first peaked in August 2015 when the twelve-month average price per sq. ft. hit $269 and finally exceeded that level ten months ago. The twelve-month average currently stands at $280, up 4% from $270 in October 2017. The six-month average has climbed to $277, up from $265 in October 2017 and the three-month average stands at $276, up from $262 in October 2017.

Overall luxury pricing has established a rising price trend again over the last ten months, having moved sideways between 2015 and 2017.

Under Contract Pricing

We have seen a slight rise in sales pricing over the past twelve months, but little progress in the last five months. Under contract pricing is showing a slight increase over the past month, so we expect a corresponding change in sales pricing next month.

The average under contract price for normal listings is $286 per sq. ft. The average for (the very few) lender owned homes is $161 per sq. ft and short sales average $232 per sq. ft.

Area Reports - November 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.

Paradise Valley

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Scottsdale

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Arcadia

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Biltmore

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Fountain Hills

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