Market Summary for the Beginning of February
After December's strength I was expecting a more robust housing market in January than was actually delivered. We started off the year with many advantages for sellers over 2015 in most areas. We also had a fairly weak January 2015 so comparisons were easy to beat. In that light January was not very impressive and most people will be hoping that the market will build up a head of steam in February. At the moment it is too early to make that call.
Here are the basic ARMLS numbers for February 1, 2016 relative to February 1, 2015 for all areas & types:
- Active Listings (excluding UCB): 22,096 versus 23,950 last year - down 7.7% - and up 10.1% from 20,073 last month
- Active Listings (including UCB): 25,731 versus 27,095 last year - down 5.0% - and up 12.4% compared with 22,883 last month
- Pending Listings: 5,688 versus 5,631 last year - up 1.0% - and up 16.9% from 4,865 last month
- Under Contract Listings (including Pending & UCB): 9,323 versus 8,776 last year - up 6.2% - and up 21.4% from 7,675 last month (unnaturally high due to TRID)
- Monthly Sales: 5,189 versus 4,756 last year - up 9.1% - but down 22.1% from 6,658 last month
- Monthly Average Sales Price per Sq. Ft.: $139.33 versus $131.68 last year - up 5.8% - and up 1.0% from $137.96 last month
- Monthly Median Sales Price: $209,500 versus $195,000 last year - up 7.4% - but down 2.6% from $215,000 last month
Active listings (excluding UCB) grew 10% last month compared with 6% in January 2015, so the supply situation eased somewhat in many price ranges. Listings under contract grew 21% last month, but they grew more than 30% in the same period last year, so this measure of demand was surprisingly weak. The other major measurement of demand - sales - was relatively strong. This may have been because there were still some contracts delayed by TRID that were closed in the first half of January. Sales were up 9% from a year ago, which is encouraging, and the drop from December was only 22% whereas in January 2015 it was 26%. This balances out the rather poor reading on listings under contract.
For many sellers, supply has been growing a little faster than they would like over the past month, meaning they have more competition in February. Many may find their price expectations a little too ambitious unless they are prepared to be very patient. This is especially true at the higher price ranges where demand has been weakened by the poor performance of the stock market. In the mid ranges supply has grown too but demand has also strengthened. At the lower end of the price spectrum, supply is still very low, although it has risen quite a bit in a few locations like El Mirage, Sun City, Sun City West, Buckeye Surprise & Peoria.
All in all, how 2016 will turn out for the housing market is still undetermined, but we are slightly more cautious in our optimism than we were at the beginning of January.