IN-DEPTH ANALYSIS

August 2006

 

 

July ARMLS Reports

 

Resale Listings

 

The listing count reported in the July ARMLS Reports, which were released on August 15th, was 47,358—up 1,578 listings from the June reports.  For the seventh month in a row, this again sets a new record of the highest listing count that the Phoenix area market has ever reported.  The record level of listings prior to January 2005 was 30,046 listings in February 2003.  The monthly listing quantity increased 3.4% over the June report.

 

If your clients do not believe that the market has changed, and they expect multiple offers and selling prices exceeding the listing prices, use this information.  Tell them, “Compared to twelve months ago, listings have increased 20,631!” 

 

Resale Sales

 

ARMLS-reported sales for July fell 1,114 from sales in June 2006.  On an annually adjusted basis sales were down 3,301 or about 30% from June 2005.  July’s sales decline is not typical for this month, but is not totally uncharacteristic to the market’s normal calendar pattern.  In this normal calendar cycle, sales tend to be highest in the summer and then gradually taper off over the next few months before resuming the climb during the first quarter of each year.  The winter months are consistently the lowest in sales. 

Our sources of data for these displays are the ARMLS reports.  In these, there are three months, January – March 2005, for which we have not shown listing data because of apparent discrepancies.  Additionally, ARMLS notes that the listing information for March through August 2002 may contain errors, but we have chosen to display this reasonable data above.

 

A Two Year Perspective

 

The graph below displays the same data as above, but focuses on only the most recent 24 months.

 

 

 

 

Adjusted Monthly Sales Trend

 

Sales, when compared to one year ago, fell for the tenth consecutive month.  This drop of 3,301 is illustrated in the chart below and is the largest drop so far reported.  The chart is divided into market condition segments by comparing current sales activity to the sales activity during the same month in the previous year.  Orange reflects relatively normal conditions; Green shows higher than average sales; and Red indicates slowing toward more typical market activity. 

 

Analysis of these figures clearly shows the following:

 

1.      Prior to ten months ago, sales increased every month for the past three years when compared to that month in the year prior (from orange to green, then back to orange).

 

2.      The ten most current months (red) shows that hot market has disappeared.

 

3.      The collective increase in sales for the past sixteen months has been at a substantially slower rate than during the preceding thirteen months (green).

 

ARMLS REPORTED SALES

 

 

Our Assessment of the Resale Market

 

Supply and demand are interrelated variables in the Real Estate Market.  At this time changes in the market are being driven almost exclusively by changes in supply.  A year ago demand was the primary driver.  With the skyrocketing supply, resale housing prices have moderated.  We expect sales to continue at a pace similar to 2003 or slightly slower than that.

 

See our other related Resale Articles in this issue of In-Depth Analysis.

 

Copyright® 2006 - This information is compiled and written by Ultimate Information Systems, Inc. Use of this article, in part or in its entirety, is expressly prohibited without written permission.  Click here (hyper-link to eMail window) to request limited rights to reuse this information.

 

We welcome your comments, just click here.