Market Summary for the Beginning of March
As we enter the last month the first quarter and enter the Spring selling season, here’s the housing market update for the month of March.
Here are the basics – the ARMLS numbers for March 1, 2024 compared with March 1, 2023 for all areas & types:
- Active Listings: 16,568 versus 14,739 last year – up 12% – and up 6.4% from 15,574 last month
- Pending Listings: 5,371 versus 5,911 last year – down 9.1% – but up 17% from 4,576 last month
- Under Contract Listings: 8,693 versus 9,109 last year – down 4.6% – but up 17% from 7,423 last month
- Monthly Sales: 5,720 versus 5,706 last year – up 0.2% – and up 29% from 4,435 last month
- Monthly Average Sales Price per Sq. Ft.: $293.70 versus $271.11 last year – up 8.3% – and up 1.7% from $288.74 last month
- Monthly Median Sales Price: $440,000 versus $413,000 last year – up 6.5% – and up 2.3% from $430,000 last month
While these figures may not meet lofty expectations, they fall short of being calamitous. February 2024’s closed listing counts managed a meager 0.2% increase over the previous year, a far cry from the robust volume recovery many anticipated. On a brighter note, sales pricing outperformed expectations, showing a 1.7% uptick from the previous month based on the monthly average sales price per square foot, with the monthly median sale price also rising by $10,000.
However, the sluggish rate of contract signings is cause for concern, trailing both our projections and historical averages. With just 8,693 listings under contract as March begins, marking a 4.6% decrease from the same period last year, the momentum remains subdued. This trend is further underscored by the steady increase in active listing counts, rising by 2,000 since the start of the year, in stark contrast to the scarcity of new supply witnessed in the previous year.
Reflecting on past miscalculations, such as Goldman Sachs’ erroneous forecast of Arizona home prices plummeting to 2008 levels in 2023, which have since proven unfounded, highlights the unpredictability of market projections. Despite this, the absence of imminent market collapse in the short or medium term provides some sense of stability. Yet, the market’s struggle to gain traction persists, with incoming supply not entirely aligning with demand, resulting in a delicate balance that marginally favors sellers across various sectors.
At the higher end of the market, an abundance of supply underscores the challenges faced by sellers in these segments.
At the top end of the market we have a lot of supply.
- Over $10 million, there are 76 active listings – this is 2.6 years of supply at the current closing rate of 29 per year.
- Between $5 million and $10 million, there are 221 active listings – this is 16 months of supply at the current closing rate of 164 per year.
- Between $3 million and $5 million, there are 319 active listings – this is 8 months of supply at the current closing rate of 455 per year.
Market conditions are currently quite stable, so the idea that some sort of collapse is imminent is extremely far-fetched. However conditions can and often do change with little notice, so it is always worth keeping a close eye on the key numbers. We’ll keep you posted and send you an update next month.
