It is surprising that greater use is not made of the Listing Success Rate by other analysts. It is one of the most reliable measures of the health of the housing market and is both timely and accurate. The only serious problem it has is in January when it dives because of the large number of listings that expire on December 31. It pops back up again in February. This need not concern us right now when looking at the past 6 months:

Anything over 80% is extraordinarily high and back in April we were still over 90%. The massive cooling trend brought us down to 70% by August and we have drifted lower since then. The key to interpreting the chart is to remember that 67% represents a normal balanced market with supply and demand roughly equal to each other. In the last month we have dropped below 67% and are currently recording a success rate of 65%. The rate of decline is slow but accelerating.

The market is extremely weak from a volume perspective, but it is close to normal when thinking about the balance between supply and demand. The fact that we have dropped below 67% is analogous to the CMI dropping below 100. Buyers have an advantage over sellers, but it is not yet excessive. For those who have entered the Phoenix housing market within the last 14 years, we should point out that we saw listing success rates as low as 23% in early 2008. That was a truly dreadful market for sellers. The current situation only looks bad when compared with the last 10 years. Compared with 2008 it looks just peachy.

Market insights provided by the Cromford Report.