April 5, 2018
V.P. Business Development & Real Estate Analyst, Grand Canyon Title Agency, Inc.
This report reviews trends for previously owned single-family homes in Maricopa County. The information is compiled from Arizona Regional Multiple Listing Service, Inc. (ARMLS).
Strong Start in 2018 for Sales and Median Sale Price, but not for New Listing Inventory
January 2018 sales of 4,404 were up three percent over January 2017, and February 2018 sales of 5,026 were up 7.7 percent over February 2017. The median sale price in January 2018 of $273,000 was $21,635 (or 8.6%) higher than January 2017. The median sale price in February 2018 of $276,000 was $21,500 (or 8.4%) higher than February 2017. New monthly listings, however, did not perform as well. There were 7,393 new listings in January 2018, which were just 61 more than January 2017, while February 2018 had 6,907 new listings, which were 311 fewer (down 4.3%) than February 2017.
Which Months May Have the Most and the Least New Monthly Listings?
New monthly listings are defined as the number of homes listed with ARMLS in a particular month. The line graph below shows the number of new monthly listings from January 2014 through February 2018. We see similar patterns in each year. At a certain time in a given year, the line forms a V shape. The bottom of the V is December, when the fewest sellers put their homes on the market, giving buyers the fewest number of choices. Then new listings skyrocket in January, which is the beginning of the listing season. In January 2018, new monthly listings of 7,387 were 3,109 more, or 42% higher, than in December 2017. In February, new monthly listings go down a little from January because it is a shorter month, then they go up in March. For the last four years, March has been the month with the highest number of new monthly listings. After March, the number of new monthly listings generally goes down, then goes up again in October. After October, the number of new listings goes straight down, forming the bottom of the V.
Which Months May Have the Highest and the Lowest Median Sale Price?
The table below shows monthly median sale prices from January 2014 through February 2018. I define the sale price date as the day of close of escrow, which occurs when the deed is recorded. All of these years show January as the month with the lowest sale price, with the only exception being February 2014, when it was the same as January 2014. The years 2015, 2016, and 2017 all start the first half of the year with a similar trend. January starts the year with the lowest sale price for the year. It then increases five consecutive months until June. Then, after June, there is a July sale price drop. The July 2015 drop from June 2015 was 2.1%. The June-to-July drops in 2016 and 2017 were 2.3% and ~1%, respectively. The months with the highest sale price from 2014 through 2017 were as follows: December 2014 ($223,000); June 2015 ($240,000); June/September (tie) 2016 ($255,000); and November 2017 ($271,000).
The sale price at the end of each year was always higher than it was at the beginning. In 2014, the December sale price was 6.2% higher than January. This pattern continued in 2015 (+9.2%), 2016 (+5.4%), and 2017 (+7.4%).
Sometime in 2018, the sale price will most likely surpass the highest month ever, which was June 2006, when it reached $287,500.
Median Sale Price for Previously Owned Single-Family Homes in Maricopa County
These trends apply to properties in Maricopa County as a whole and may or may not apply to a specific property. This is where a real estate agent comes in. An agent can do a market analysis of a specific property to determine how it compares to overall trends, and then explain to their customer if these trends apply.
There is one thing I know that does apply to real estate in Maricopa County: 2018 will be another exciting year to be in the business of buying and selling real estate!