Arizona Market Update and Insights: November 2024

The Arizona real estate market is anything but predictable this November. With active listings hovering around 22,000, we’re seeing trends that haven’t occurred in nearly a decade. If you're buying or selling in Greater Phoenix, here’s what you need to know about the state of the market, what’s driving these changes, and how you can make the most of this rare moment of opportunity.

Active Listings: A Decade-High Surge

This month, active listings have surpassed the supply levels seen in 2015 and 2016, and you’d need to go back to 2014 to find inventory this high in November. What’s particularly unique is how the year started:

• January 2024: Fewer listings than January 2023.
• Spring 2024: The usual seasonal dip in active listings never occurred.
• November 2024: Instead of a typical decline, inventory unexpectedly spiked.

What’s Driving This Surge?

The reasons for the late-year rise in inventory are speculative but intriguing:

• Relocation Before Competition Heats Up: Sellers may be listing now to get ahead of the spring market.
• Attractive New Construction Deals: Builders offering incentives could be pushing homeowners to sell sooner.

Regardless of the cause, this late-year surge makes 2024 one of the most unusual markets in recent memory.

New Construction: Leading the Market

New construction homes are dominating, making up over 30% of all homes sold this year. Builders are pulling out all the stops, offering:

• Interest Rate Buydowns: As low as 2.5%.
• All Closing Costs Covered.
• Appliances Included.

These incentives are hard to compete with, creating challenges for resale sellers in many markets.

Market Index: Buyers Gain the Upper Hand

The overall market index now sits at 86, the lowest level since October 2010. For context:

• Below 90: Marks a buyer’s market.
• 86: Indicates the strongest buyer advantage in 14 years.

This shift is reflected in individual city trends:

• Chandler and Cave Creek are the strongest performers this month.
• Fountain Hills experienced the steepest decline, dropping 28% in its index.
• Peoria began to slip again after holding steady.
• Paradise Valley is showing slight recovery signs.
• Scottsdale, Buckeye, Surprise, Maricopa, and Mesa each saw declines of 7% or more.

Market Snapshot by City Type

• 7 Seller’s Markets: Conditions still favor sellers.
• 5 Balanced Markets: Equal opportunities for buyers and sellers.
• 5 Buyer’s Markets: Buyers hold a strong advantage.

For Buyers: Now is Your Time

What Does This Market Mean for You?

Buyers are gaining unprecedented leverage. With less competition and motivated sellers, this is an ideal time to make a move—especially for first-time homebuyers. According to HUD, you may qualify as a first-time buyer even if:

• You haven’t owned a primary residence in the past three years.
• You’re a single parent who only owned property with a former spouse.
• You owned a home that wasn’t permanently affixed to a foundation.

Programs for first-time buyers offer perks like down payment assistance, closing cost grants, and lower interest rates.

Why Act Now?

Buyer’s markets are fleeting in Phoenix. The last one in 2022 lasted just four weeks, and prior to that, 2010 saw four months of buyer-friendly conditions. If mortgage rates dip below 6.5%, the market could quickly swing back in favor of sellers.

For Sellers: Standing Out Is Critical

Challenges in Q4

Mortgage rates, hovering in the high 6% range, have slowed buyer demand. Combined with a seasonal slowdown, the market has officially shifted to a buyer’s market—making it a tough time for sellers.

How to Compete

To succeed in today’s market:

1. Price Competitively: Set a sharp, realistic price to attract buyers.
2. Enhance Property Condition: Clean, stage, and ensure your home is move-in ready.
3. Offer Incentives: Cover closing costs, provide rate buydowns, or make repairs.
4. Be Patient: Expect longer marketing times, especially during the holidays.

In Closing: A Rare Opportunity for Buyers and Sellers

The Greater Phoenix market is in uncharted territory, with active listings at their highest in a decade and buyers gaining an advantage not seen since 2010. Here are the key takeaways:

• Buyers: Leverage today’s conditions before the spring market heats up.
• Sellers: Focus on pricing, condition, and incentives to attract offers.
• New Construction: Builders continue to dominate with aggressive incentives.

Planning for 2025

If you’re considering a move, now is the perfect time to evaluate your options. I’m offering personalized cost comparison analyses to help you understand how relocating to Arizona could impact your finances. Recently, I helped a client moving from California to Phoenix uncover a 23% lower cost of living, saving thousands annually.

Let’s Connect
Whether you’re buying, selling, or exploring your options for 2025, I’m here to help. Together, we can navigate this shifting market and create a plan tailored to your goals. Don’t wait—opportunities like this don’t come around often!