Sales of homes in Greater Phoenix are increasing and the inventory is decreasing; home demand is up and supply is down.  The Blue line and Red line are starting to converge.  They are still very far apart meaning that the total supply of homes, which stands at 9.2 is still high but its lower then last year. 

This is a good trend.  The only thing putting a sour note on it is the Green line or the median price.

The median price has been declining since it peaked at $359,900 in May of 2005.  It's now at $242,500 or 3% lower.  33% is a big decline but it hasn't been experienced by all areas, especially the Central Cities.

	Median Price	Units Sold	Days on Market	Months of Supply
2008	$242,500	5,476	100	9.2
2007	$299,900	4,991	92	10.28

Take a look at the graph above.  It shows the percentage of homes sold at 100% or more of listing price.  Sellers are becoming more reasonable with pricing. 

That is a big increase in full price sales.  What is does not show is concessions or what the original prices were.  While the home may have sold at full price its common now for the seller to cover a large amount of the buyer's closing costs and or down-payment in the case of FHA loans.  This concession can be 3%-8% of the purchase price.

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