Greater Phoenix Residential Market

Fletcher Wilcox
V.P.  Business Development and
Real Estate Analyst
Grand Canyon Title Agency

Among all Cities in U.S. Phoenix Number One and Mesa Number 8

Purchase Price Increases for Thirteenth Consecutive Month

New: Appraisal Shortfall Language added to Additional Clause Addendum

U.S. Census Bureau Population Results for Arizona Cities

The information in this report for sales, listings, median purchase price and median monthly rent was compiled from the Arizona Regional Multiple Listing Services, Inc. The residential category referenced is single-family resale homes in Maricopa County, unless expressed otherwise.

June Results

For the thirteenth consecutive month the median purchase price for a single-family resale home increased and reached a new record high. It was $445,000 in June 2021. This is $9,750 or 2.2% higher than May 2021 and $105,000 or 30.9% higher than June 2020. What a difference a year makes. Sales in June 2021 were 6,763 which is 332 or 5.2% higher than May 2021 and just 23 more sales than June 2020. Listings in June 2021 were 6,950 which is a tinge more than the 6,939 in May 2021 but 831 or 13.6% higher than June 2020. When comparing the first half of 2021 to the first half of 2020, listings are up 1.5% while sales are up 13.6%. The median monthly rent for a single-family resale home in Maricopa County was $2,190 in June which is $93 or 4.4% higher than May 2021 and $395 or 22% higher than June 2020. The median monthly rent in June has never been higher.

Appraisal Shortfall Language added to Additional Clause Addendum

Purchase prices are rising so fast in Maricopa County homes often do not appraise for the agreed upon contract purchase price. This circumstance is causing some buyers to insert in the contract language addressing the steps and terms the buyer will take to make up the difference between the purchase price and the appraised value. To address this circumstance the Arizona Association of REALTORS in June added a new clause to their Additional Clause Addendum. The new clause is the Appraisal Shortfall. It is on lines 37-43. It reads

APPRAISAL SHORTFALL: In the event the Premises fail to appraise for at least the purchase price in any appraisal required by lender, Buyer agrees that Buyer shall submit additional funds via U.S. currency or financing in an amount equal to the difference between the appraised value and the purchase price, provided that the difference does not exceed $_______. Buyer and Seller agree that if the difference between the appraised value and the purchase price exceeds the amount of money set forth on line 40, Seller is not obligated to lower the purchase price and Buyer has five (5) days after notice of the appraised value to cancel this Contract and receive a return of the Earnest Money or the appraisal contingency shall be waived, unless otherwise prohibited by federal law.

For frequently asked question on the Appraisal Shortfall clause go to https://www.aaronline.com/2021/05/19/additional-clause-addendum/

Top Ten Cities for Year-Over-Year Population Changes

The following information was compiled from data released by the U.S. Census Bureau. The City of Phoenix led all cities in the United States for year-over-year population increase. According to the U.S. Census Bureau the City of Phoenix gained 25,194 or 69 people per day from July 1, 2019 to July 1, 2020. The City of Mesa finished number eight among all cities in the U.S. gaining 9,662 or 26 people per day. Five Texas cities, San Antonio, Fort Worth, Austin, Frisco and McKinney were in the top ten. Excluding Arizona, Phoenix gained more people than did thirty-six states and Mesa gained more people than twenty-eight states. The City of New York led all cities for year-over-year population decrease. It decreased by 89,712 or 246 people per day. Number two city for population decrease was Chicago at 13,854 or 38 people per day. Finishing third, fourth and fifth for population decrease were the California cities of San Jose, Los Angeles and San Francisco. See Table One.

Table Two shows the July 1, 2019 to July 1, 2020 year-over-year and per day population increase for Arizona cities. Noticeable is the growth in population in the far East Valley and far West Valley. Surprise finished third with an increase of 6,129 or 17 people per day, Buckeye fourth at 5,609 or 15 people per day and Queen Creek third at 5,442 or 15 people per day.

June Purchase Price and Rent Results for Twenty-Six Cities in Arizona

All twenty-six cities in this report had year-over-year increases in both the median purchase price and the median monthly rent. See Table Three.

Conclusion & Predictions

Will July’s median purchase price be higher than June’s? Well, yes. However, instead of a month-over-month average increase of $13,000 per month this year, I expect the median purchase price to increase around $5,000 in July and will probably end close to $450,000.

The Phoenix Suns will be the NBA Champions!

Note: Starting soon will be a monthly call for real estate agents to go over trends and strategies for competing in today’s residential marketplace. To receive notification, email me at FWilcox@gcta.com

The information in this report is deemed accurate but real estate agents, buyers and sellers should verify any information contained in this report before buying or selling.

Table One

Top Ten Cities for Population Increase and Population Decrease

Time Period: July 1, 2019 to July 1, 2020

Data compiled from the U.S. Census Bureau

The Wilcox Report™

Table Two:

Arizona Cities YOY Population Increase

Time Period: July 1, 2019 to July 1, 2020

Data compiled from the U.S. Census Bureau

The Wilcox Report™

Table Three: June Results for Cities in Maricopa and Pinal Counties

The Wilcox Report™