The Cromford Report™ - Monthly Market Review – June 28, 2010 Brought to you by Old Republic National Title Insurance Company
Greater Phoenix – Single Family Detached Market Headlines •
Demand falls sharply after expiry of tax credit, especially for entry level homes.
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Supply increasing below $200,000 but decreasing above $200,000.
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Sales pricing at a temporary peak around $93 per sq. ft. following brisk spring sales activity.
Overview The lower end of the market cooled significantly during June with fewer listings under contract and lethargic buying activity in the absence of the tax credit which expired at the end of April. The tax credit inspired a large number of buyers to sign contracts prior to May 1 and so closed sales volumes have fallen only slightly so far as these contracts take a month or two to close escrow. We expect sales volumes to fall further over the next two months. Higher end homes did not experience as much of a cooling trend and the supply/demand balance has actually improved for sellers over the last few months. This sector of the market did not participate in the sales boom of 2009, but competitive pricing is now bringing new buyer interest in luxury homes. Pending sales include far more short sales than in the spring – 38% now compared with 29% at the end of April. Normal listings comprised 32% of pending sales at the end of April but only 24% now. This change in mix will probably cause the average sales price per sq. ft. to fall over the next two months. Sales prices of individual properties are generally flat at the moment and likely to stay that way in the short term. Foreclosures
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