Market Update: February 2020 Results Purchase Price Up Again Record Number of Jobs

Fletcher Wilcox

V.P. Business Development & Real Estate Analyst, Grand Canyon Title Agency

February 2020 Results: What Was Higher – What Was Lower

Higher in February 2020 over February 2019 were sales of single-family resales in Maricopa County (Greater Phoenix). The 5,153 sales this February were 626 orfourteen percent higher than last February when there were 4,527 sales. The median purchase price reached a new high in February 2020. The February 2020 median purchase price of $326,000 was $32,000 or eleven percent higher than February 2019 when it was $294,000. The February 2020 median purchase price of $326,000 surpassed the past record high of $320,000 in both January 2020 and December 2019. So, from January 2020 to February 2020 the median purchase price went up two percent or six thousand dollars. The February 2020 median purchase is $103,775 higher than in February 2015. Dollar sales volume was $500,000,000 higher in February 2020 than February 2019.

This is what was lower in February 2020 compared to February 2019. First, less listings hit the market this February compared to last February. Total new listings in February 2020 were 6,451 which were 219 or three percent less than the 6,670 in February 2019. Lower were the average number of days a property was on the market before going under contract. February 2020 average agent days on market known as ADOM were 59 days compared to 68 days in February 2019. In February 2020, fifteen percent of sales had an ADOM of five days or less compared to nine percent of sales in February 2019. 

Table One compares sales and listing results for February 2019 to February 2020. Chart One shows a history of the median purchase price.

We Are in the Peak of the Listing Season 

Chart Two shows by month the daily number of new listings for single-family resales in Maricopa County for the last twenty-six months. The peak months of the year for sellers to list their properties is approximately the first half of the year. Then there is a drop in new monthly listings in either June or July. November and December are the two months with the least number of new monthly listings.

Jobs, Jobs and More Jobs 

The 2019 job numbers are in for Maricopa County. Chart Three shows the annual number of people employed in Maricopa County from 2010 through 2019. The information was compiled from the Arizona Office of Economic Opportunity. The number of people employed in 2019 was 2,105,400. There has never been a year with more people employed. The number of people employed in 2019 was 3.1 percent or 63,300 higher than the number of people employed in 2018. When dividing 63,300 by 365 days, there was an increase of 173 jobs per day in Maricopa County in 2019 over 2018. A report from the Arizona Office of Economic Opportunity expects the number of jobs in 2020 to be 66,000 more than in 2019 for Maricopa County.

The year with the least number of people employed after the great real estate recession was 2010. There were 225,000 less people employed in 2010 than in 2007. Since 2010, the number of people employed has increased annually, in a stair step fashion. When comparing the number of people employed in 2010 to 2019, there were 465,300 more people with a job in 2019 than 2010. That is a lot of people that need housing.

Conclusion 

There is a great demand for housing in Maricopa County due to the sheer number of people with a job. The number of people employed has grown considerably since 2010 and is expected to continue to grow in 2020. People are moving to Maricopa County because of employment opportunities and employers are moving to Maricopa County because people are moving here. Housing in Maricopa County is also relatively affordable when compared to the West Coast.

Even though monthly listings are down year-over-year for both January and February in 2020, the number of listings are up considerably from November and December of 2019. Traditionally, the first part of the year is the peak time of the year for sellers to list. It is also the time of the year when the most contracts are written. So, agents, go on lots of listing appointments and get your buyers out to buy!

The information for single-family resales in this report was compiled from the Arizona Regional Multiple Listing Service, Inc.