The Phoenix housing market is displaying a noticeable shift, where homes are sitting longer before being sold, and a buyer's market is emerging. According to data from realtor.com, homes in the Phoenix area are now remaining on the market for a median of 70 days, marking a significant change from the previous faster pace of sales. This new trend, first seen in 2023 due to climbing interest rates, has disrupted what was once a predictable ebb and flow of home-buying seasons.
With homes lingering longer, the inventory in the Valley has increased. As ABC15 reports, last month saw 17,400 homes available for sale in the Phoenix metro area. Although this is not an all-time high, it ranks among the higher figures recorded since 2023. Despite these headwinds, Phoenix is outpacing many major metros across the nation, staying just under the national median of 73 days on the market. Certain zip codes within the city, such as Mesa's 85202 and Glendale's 85303, are experiencing faster sales while other areas are not keeping pace.
Redfin's study further confirms the burgeoning buyer's market, finding a 66% difference in December between the number of home sellers versus buyers in Phoenix, the 14th-highest among the 50 most populous metropolitan areas. Phoenix had the third-highest number of homes for sale of any city in the study, totaling 30,669. This imbalance, according to a Phoenix New Times report, contributes to a reluctance on both sides of the market to compromise on price.
In a statement obtained by Phoenix New Times, Scottsdale-based Realtor Zack Heene said, "They usually say buyers kick tires. For this last couple of years, it’s been sellers doing that." He mentioned that many sellers, having purchased their homes at lower interest rates or paid them off entirely, are choosing to withdraw their homes from the market rather than accepting lower offers. This response to the current market conditions reflects a wider trend of patience and non-urgency among sellers.
The effects of the COVID-19 pandemic continue to reverberate through the housing market, influencing seller decisions. Having locked in lower interest rates, or paid off their mortgages, homeowners are not in a hurry to sell in a market where they'd likely face higher rates on their next purchase. As a result, the REMAX National Housing Report and the Phoenix Realtors Association have both noted an increase in inventory and a drop in sales activity. REMAX identified the median sale price of a single-family home at $457,500 - a price out of reach for many in the Valley, further driving down demand as potential buyers and sellers adopt a wait-and-see approach for interest rates to realign more favorably.
