11/25 Slowdown
Mortgage Apps Increase For 3rd Straight Week, Rates Remain Steady, Resale Home Sales Hit Lowest Level Since 2010
This newsletter is 507 words and should take about 5 minutes to read.
Read last week’s newsletter here “11/18 Giving Thanks'“
tl;dr
The Phoenix market has hit its “buyer’s season”
The period between Thanksgiving and New Years
The average mortgage rate is 7.32%
Phoenix
For Buyers: Buyer who felt they lost out on the buyer’s market last year will be getting another chance this year. The Greater Phoenix housing market, on the whole, only has a few days left before it enters a balanced market. However, as 18 cities are still in seller’s markets, there are 11 that are either already in balance or in buyer’s markets.
What does a buyer’s market mean for buyers? Most buyers assume it means that sales prices will come down, but by the time sales price measures show a decline the buyer’s market could be 2 months old, or already over like it was last year. The first thing to move isn’t a sales price, but a list price combined with higher seller incentives for buyers.
For Sellers: This is not a good time to test a price higher than market value for your home. As the seller’s market weakens on a daily basis, it’s the outskirts of town that are affected first as the interior cities follow quickly. As of November 9th, the following cities are in buyer’s markets: Surprise, Litchfield Park, Goodyear, Buckeye, Maricopa, Casa Grande, Gold Canyon, and Queen Creek. Balanced markets are Cave Creek, Peoria, and Sun City. All others are still seller’s markets, but weakening fast.
Seasonally, the best time to list your home is not in the 4th quarter. However, sellers always want to be selling in a seller’s market. While it’s not a bad idea to wait until the 1st quarter typically, under these circumstances the benefit could be offset by a weaker buyer’s market. That means more competition from new listings, more days on market, and more price reductions. The determining factor that could change the course of the current market trend is mortgage rates, which have been unpredictable and volatile this year
The Cromford Market Index is a gauge of Phoenix’s Supply and demand metrics. 100 is considered a balanced market. Anything higher than the 100-point benchmark is considered a seller’s market. Anything below 100 is considered a buyer’s market.
As of November 24th, 2023, the CMI has decreased to 107.3. Down 3 points from 7 days ago.
Supply has increased by 1.4 points and demand has decreased by 4 basis points
Rates
Mortgage loan application volume increased 3.0% from one week earlier.
The Refinance Index increased 2% from the previous week and was 4% lower than the same week one year ago.
The Purchase Index decreased 1% compared with the previous week and was 20% lower than the same week one year ago.
7-Day rate change: -4 basis points
YoY change: +51 bps
Average interest rate: 7.32%
S&p500 vibe check
Meme, tweet, & fact of the week
The Arizona State vs. Arizona Territorial Cup dates back to 1899