There were few positive signs in the Chandler, Arizona single-family real estate market in October 2008. The most positive statistic was that the average selling price rose nearly $20,000 from the previous month. However, the average days a single-family home in Chandler sat on the market rose after falling for the previous four months while the months of inventory increased pretty dramatically.
The average selling price in Chandler in October 2008 was $277,662, up from $257,606 in September. On average, homes that went under contract in October did so at just under 96% of the listing/asking price.
In the graph above:
- the blue line indicates the average price of single-family homes currently listed in Chandler.
- the green line indicates the 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 Chandler.
Compared to a year earlier, prices in Chandler have declined by 17%. Check out the graph below, which indicates that price declines may be starting to stabilize:
If going just off the graph above, it may indicate that prices are starting to stablize. However, one piece of information is never enough to make valid conclusions. We are entering the slower real estate season as school is in full swing, families are thinking of the holidays and fewer people want to buy. As a result, homes on the market sat longer in October 2008 compared to September, from 92 days to 99:
Further illustrating the slow-season is the months of inventory available in Chandler, moving from just under 6 months on September to just over 8 months in October:
As a reminder:
- 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.
The increase in inventory in Chandler in October is not a good sign, but was expected given the slower selling season for real estate.
As in previous months, the Chandler single-family real estate market continues to demonstrate a declining market (increased inventory, days on market) with subtle hints of stabilization (increase in the average selling price).
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