If you need assistance, please call 602-410-0827

May 14, 2022 Market Update

Saturday, May 14, 2022   /   by Bryan Baylon

May 14, 2022 Market Update

 It is time to look at another of the dominoes that have fallen over - the contract ratio. The contract ratio compares the number of listings under contract with the number of active listings without a contract. It is a classic case of comparing demand with supply. This ratio has plummeted over the past 4 weeks because demand has weakened while supply has increased sharply.

This tells us that the previously crazy hot market has turned into just a hot market. But it also tells us that if the cooling trend continues at a similar rate, we could be in a warm market within a month and a normal market in just 2 months. The former is very likely, the second is more speculative and anyone who tells you they know what the market will be doing in 3 months is kidding themselves.

Here is the contract ratio chart for single-family homes in Phoenix:


The fall from 250 four weeks ago to 145 this week is even more dramatic than the sudden drop we saw at the start of the COVID-19 pandemic. The drop in 2020 was quickly recovered and within two months we were back higher than we started. The current decline appears to have more staying power and momentum - and we can see that a drop back to 2018 levels is likely by the end of May.

2014 was the last time we had a market that was fairly "normal" so use that line for reference.

Market incites provided by the Cromford report.

Keller Williams Northeast Realty - The Baylon Group
Bryan Baylon
2005 W. Happy Valley Rd #150
Phoenix, AZ 85085

© 2024 Arizona Regional Multiple Listing Service, All rights reserved. The data relating to real estate for sale on this website comes in part from the Arizona Regional Multiple Listing Service. Real estate listings held by brokerage firms other than Bryan Baylon - Keller Williams Northeast Realty are marked with the Arizona Regional Multiple Listing Service logo and detailed information about them includes the name of the listing brokers. All information deemed reliable but not guaranteed and should be independently verified. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) nor Arizona Regional Multiple Listing Service shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. June 17, 2024
This site powered by CINC: www.cincpro.com