Chandler AZ Housing Update – August

Chandler saw a very healthy change in the median sales price last month over August ’17 – up over 12% from $289,000 to $325,000. Home sales volume was up over 7% from last year’s units – 467 sales vs. 434. The average per square foot price was $169, up from $159 last year.

Homes that closed are selling in an average of 35 days and for 99.3% of listed price, indicating little to no negotiating room in the list price, particularly at the beginning of the listing period.

Current active listing inventory is 562 homes, with 444 under contract at a median sales price of $335,000. The median asking price is $386,490 and is asking $174/sq foot. With a 1.2 month supply of homes in the city, we remain in a strong seller’s market. The large gap in asking price vs. what homes are under contract for shows that homes in the higher price ranges are not only taking longer to sell, but they are also making up a large portion of what is for sale.

We are seeing kind of a lull in the market at the moment where the market is “hanging out” a bit – that time after kids have settled into school and the heat is a real bear. Although it is very much a seller’s market and homes under the $350,000 mark are flying off the shelves, buyers looking above this range are far fewer in number and much more discerning/particular before pulling the trigger.

Note that buyers as a whole are incredibly conservative in their choices at this time. For example, we are working with a client who easily qualifies to purchase a $400,000 home, yet we are shopping for homes that are priced closer to $275,000.

Appraisals are coming in to support sales prices with a few exceptions.

Attractive interest rates, healthy employment levels, low delinquency/foreclosure rates indicate that this should just be a temporary phase in which the buyers are just not as active now as they were during the spring/early summer season.

Closing cost assistance is still being negotiated from sellers and repairs are being done.

The distress factor, which consists of short sales and foreclosures, declined from 2.5% of closed sales to less than 1%. Currently only 1.5% of Active listings fall into this category,  and 3% of all homes under contract (includes homes that can take months for bank approval, and “stack up” in the pipeline as a result).

As Chandler schools have convened, it appears that we have passed the “prime time” or peak selling/buying season of 2018. Approaching the Fall we are likely to see activity tick up again, but not to the degree we saw over the Summer season.

We are seeing a very diverse group of homebuyers and sellers, predominantly Millennial first-time homebuyers, followed by trade-up/downsizing buyers and sellers (who are generally selling their homes and not renting them out); some investors are selling off properties they purchased after the market crash and seeing healthy profits, but not enough to keep up with the intense demand we are seeing now and anticipated increase in buyer activity as the summer comes into full swing.

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