Over the last few years there has been a lot of talk about the notable shift our market has experienced since the second half of 2022. While I know my own commentary has addressed the changes, I must admit that the comparison of today's market to that of 2021–2022 isn't quite fair, because the COVID pandemic created a true perfect storm of events that led to the most frenzied seller's market ever seen. Today, let's provide some much needed context by comparing our current local market to the years before the disruption of the pandemic — a more normal market, like 2018–2019 — and I think you'll see that other than the much higher sales price, the comparison isn't quite so stark.
We're going to focus on three main metrics — sales volume, median days on market, and median sales price — across three distinct time periods. The years 2018–2019 serve as a solid benchmark for a relatively typical, mild seller's market, while 2021–2022 represent a true anomaly. When referring to the current market, we're talking about the years between 2024–2026. Since I'm writing this mid-year, we're looking for consistency by comparing data for all years from January through May.
In the pre-pandemic years, the market was strong and balanced in favor of sellers, with a steady deterioration of supply year over year. Sales volume ran about 140 sales per month in the 85383 zip code. Days on market were low by the standard of most metro areas at 56 days, but buyers did not have to feel rushed to make decisions. Homes were selling fairly quickly, values were rising at about 5–7% each year, buyers appreciated 4–5% mortgage rates, still had room to negotiate, and could still expect solid appreciation. Both buyers and sellers had great reasons to be happy.
This period of steady growth actually began in about 2015, and the pressure slowly built as supply dwindled each year, ultimately crescendoing in mid-2020 when listing inventory collapsed and buyer demand skyrocketed. When many other states were fully locked down, Arizona was attracting droves of new residents eager to buy, with very few homes available for sale. Most homes sold in days, if not hours, with bidding wars for tens of thousands of dollars over asking, leading to a peak in home value appreciation in 2021 of nearly 40%. While the frenzy was relatively short-lived, the lion's share of that gain remains intact today.
This leaves us in today's market, which I have previously described as quiet and unremarkable. It is unremarkable because the data is in line with a much more normal market. Coming from a period where homes were selling Ninja Fast and for well over top dollar, the sudden shift left many feeling a bit of whiplash — and that's fair. Inventory is higher today but within the normal range. Demand remains low because of higher interest rates, but that will likely self-correct when rates come down. If you're expecting to sell your home in the first weekend, 60 to 90 days might feel like a long time. If, however, you go into it with the understanding that it may take a few months, your patience will be rewarded. Values are still a whopping 76% higher than they were prior to 2020.
So, if you're considering selling anytime soon and would like to discuss your specific situation — please give me a call.I'd love to talk nerdy with you :)