Inventory Control in Greater Phoenix: What Price Range of Homes Are Selling?

November 10, 2008

Lower priced homes in the Phoenix valley, are approaching a balanced market shile luxury homes, especially over $1,000,000 are rarely selling.

The convention is that a 6 month supply of homes is a balanced market and that's probably for a median home price in a given city. In Greater Phoenix it's around $200,000 so we're not quite balanced but were close: still even if we did have a 6 month supply much of that is REO or lender owned which continues to have a very large impact on pricing.

None the less homes in the range of under $100,000 to $200,000 are selling rather well. Take a look at a report I did for homes under $100,000 in Greater Phoenix. You'll be surprised.

Price range and months of supply for single family homes.

>$100,000	6.6	$400 - $500,000	12.4
$100-$125,000	5.6	$500 - $600,000	20.5
$125 -$150,000	7.3	$600 - $800,000	23.7
$150 - $175,000	7.1	$800 - $1,000,000	42.2
$175 - $200,000	8.5	$1 - $1.5 million	44.1
$200 - $225,000	7.9	$1.5 - $2 million	51.6
$225 - $250,000	8.3	$2 - $3 million	82.1
$250 - $300,000	7.6	$3 + million	146.3
$300 - $350,000	9.2
$350 - $400,000	9.9

(ARMLS Data Crunched by The Cromford Report | Artur Ciesielski, CCIM)

The higher you go in price range the lower the sales, the lower the buyer pool and the higher the supply of homes. For anything over $400,000 the supply increase a lot. There is just less financing available in this price range.

Once you get past $800,000 the supply is dramatic with the supply of 40+ months. That is some fierce competition, but it does not mean a home can't sell, it just means it will have to be well priced and in good condition or otherwise a good deal.

Look at the range of $2 million plus then the range of $3 million plus. Homes over $2 million have close to a 7 year supply while homes over $3 million have a supply of over 12 years and that is if not other homes hit the market.