A real estate website is only as good as the content it provides, right? Over the course of the next week we’ll be adding statistics for the cities we primarily do business in - Tempe, Chandler and Gilbert.
For the first installment we’ll focus on Tempe real estate single-family homes over the past two years (August 2006 through July 2008). Our stats will, at first, only focus on Tempe as a whole and we’ll eventually add real estate pricing information for zip codes as well as condos.
So here goes! Below is the past two years’ pricing information for single-family homes within Tempe:
Pricing trends for Tempe single-family real estate and homes. Click to enlarge.
You can access the raw data from this graph here.
There are three important lines on the graph:
- the blue line indicates the average price of active listings in Tempe
- the green line indicates the average list price for single-family homes before being sold. In other words, this is the average price for all listings that went under contract before the final sales price was agreed upon by the buyer and seller through contract negotiations
- the yellow line indicates what the average sales price was for single-family homes in Tempe.
It should come to no surprise that prices are lower than they were two years ago. In fact, since the beginning of 2008 prices have dropped pretty dramatically especially when compared to just a year ago:
Year-Over-Year SOLD Pricing Changes for Single-Family Homes in Tempe. Click to enlarge.
The above chart details how prices have changed in single-family real estate in Tempe. For example, prices in July 2008 were 18% less than they were in July 2007. This year-over-year price change indicates the average sold price for Tempe single-family real estate.
A few more charts can help us to round out a good picture of Tempe single-family real estate. The chart below shows how long homes that sold sat on the Tempe real estate market:
The average days on market (ADOM) for single-family homes sold in Tempe. Click to enlarge.
From a height of 118 days in February 2008, the average days on the market for sold listings in Tempe is slowly declining from that peak. Sellers that price their home right should expect to sell their property within that time frame. The key, of course, is pricing the property correctly.
One last very important piece of information:
Single-family real estate inventory levels in Tempe. Click to enlarge.
This last graph that shows the current inventory levels of single-family homes in Tempe and is the most exciting! Why? Because most real estate experts agree that a “balanced market” is right around six-months of inventory:
- Less than six months of inventory indicates a “seller’s market.” In a seller’s market there are more buyers than there are homes to purchase. As a result, real estate prices may increase during a seller’s market because there is less inventory than there are buyers. This is what happened during the 2004 - 2006 real estate boom in Phoenix.
- More than six months of inventory indicates a “buyer’s market.” In a buyer’s market, real estate will often sell below the listing price because there are more buyers than inventory. Much of the country has experienced an extreme buyer’s market over the past year or two.
- Six months of inventory indicates a “balanced market.” This is the most desirable market for buyers and sellers alike. Homes will typically sell near listing price because there is a balanced amount of inventory when compared to buyers. Sellers who market their property correctly and at the current market price will often receive an offer near that list price. Buyers are more confident in purchasing because prices are stable or appreciating.
As you can see the exciting part is that overall, Tempe is and has been in a balanced market since May of 2008 for single-family homes. This, of course, can’t be said for every single neighborhood and sub-market of Tempe. Some areas may be selling quickly and others may have lingering inventory and declining prices.
So what kind of conclusions can we make in regards to the single-family real estate market in Tempe?
- Tempe has been through a major correction and transition over the past year. As a result, prices have fallen dramatically as inventory levels became historically high.
- Prices are showing signs of stabilizing. In fact, during May, June and July the average sales price in Tempe has increased - $281,226, $285,443 and $290,430 respectively.
- The price stabilization and small increase coincides with the balanced inventory levels of those same three months of May, June and July 2008.
Tempe is a great place to live - good schools, a developing downtown urban core, a central location to other valley cities and attractions, and it’s those reasons that translate into a real estate market that may be first to bounce back.
Has the Tempe real estate market hit bottom? As you’ve most likely heard before, “you never know until months later that the bottom has passed.” However, the current market snapshot shows that the worst may be over in Tempe. Prices are stabilizing and inventory is at a comfortable level.
If you’re interested in purchasing a home in Tempe, you can search our site casually or set up a fusionpower search - giving you a powerful personal and secure webpage with homes that meet your search criteria!
On average, it takes 76 days to sell a single-family home in Tempe, Arizona. This is the lowest level since August and July 2007 when the average days on market (ADOM) was 66. The ADOM continues to lower which is a positive thing for home sellers.
