Phoenix – Ahwatukee-Foothills Real Estate Market Update – June 1, 2020
The Ahwatukee-Foothills Market Update By The Numbers?
Once again, the Ahwatukee-Foothills market has remained strong in May, despite the downward national trend and they Corona Virus. The number of units closed dropped in May but the average price has surged again over the same period last year.
Ahwatukee-Foothills’ property sales in May stayed strong with 131 closed listings at an average sale price of $387,270. While this is down from the $417,095 average price of a property recorded in April, the average price of an Ahwatukee property in May is 11% ahead of the $315,612. recorded in May of last year. The May average price is up. The average sale prices recorded in May is 3% higher than the average property value of $375,234. that was recorded in 2019, for Ahwatukee Foothills real estate market.
If we shift to the period from January 1, to May 31, 2020, the average price of a closed sale in Ahwatukee is $392,141 for the period. There were 590 closed properties in the period. For comparison, in the January to May period in 2019, 699 properties closed at an average price of $365,387. The number of units sold fell from 699 to 590 units for a 16% drop in the number of units sold. However, the average value of a property that closed escrow in 2019, was $365,383. versus the average value of $392,1141. recorded for the same period this year. While the number of units sold in 2020 is down 16% over the same period in 2019, the average price per unit sold is up 7.3% in the same period this year.
The average days on market measures the pace at which homes are selling and it is a good indicator of the strength of the real estate market. In May 2020, the average days on market were down to 36 days versus the 61 days for properties to go under contract in May 2019. Marketing time measured by days on market was down 41% in May 2020. If we look at the average days on the market from January 1, 2020 until the end of May, we note that properties were going under contract in 49 days versus 66 days in the same period in 2019. So marketing time, measured by days on the market, indicates that marketing time is down 41% for the first five months of 2020 versus the same period in 2019.
We have noted and commented for several months that about 40% of listed Ahwatukee-Foothills properties are overpriced and require a price reduction to sell. It is interesting that in May, only 36 of the 131 closed properties required a price reduction to go under contract. Only 28% of the closed properties required a price reduction to sell in May.
In the January to May period, 181 of the 590 closed properties required a price reduction to go under contract. So in the first five months of 2020, 31% of properties were listed too high and required a price reduction to go under contract. The dramatic drop in the number of properties requiring a price reduction, from our benchmark of 40% to 31% is significant. We assume that the drop in the number of properties requiring a price reduction is a function of buyers offering purchase offers over comparable sales. We tell clients that any offer has to appraise to close. In the current market, it is obvious that appraisers are sliding appraised values, higher than comparable sales indicate, to meet what buyers are willing to pay in a rising market.
There are 23 million-dollar-plus active listings in the Ahwatukee-Foothills market at the time of writing. There were 2 closed sales for million-dollar-plus properties in May. We have a 12 plus month inventory of million-dollar-plus properties, however, they are selling at a steady pace of about 2 per month.
Even though we are in one of the strongest seller’s market in years, 2 properties failed to sell in Ahwatukee in May and the listings expired. It is almost incomprehensible that property would expire in this market. The old real estate axiom of location. location, location and price, price, price applies. Every property will sell at its value. If there are condition issues, they can and should be addressed or the price reduced. If there are location issues, they cannot be cured but the price can be reduced to bring the property to its value, to get a property under contract and closed. Pricing will cure call impediments to a property and get any and every property under contract and closed.
There are 154 active listings at the time of writing, Considering the 131 Ahwatukee-Foothills closed listings in May, the current 154 active listings would last about 1.17 months. Anything less than a six-month inventory is considered to be a seller’s market. The Ahwatukee-Foothills real estate market remains a strong sellers’ market.
There are 83 properties under contract and pending close at the time of writing. With reasonable market activity, we should see at least 120 to 130 closed sales in the Ahwatukee-Foothills market in June.
We stated last month and the previous month, that no one could have predicted the impact the Corona Virus is having on our world. We reiterate that, despite the economic shutdown, pressures on our supply chains and the impact of the Virus on our population, the Ahwatukee-Foothills real estate market appears to be strong and performing well. Properties are selling faster than anticipated. Prices are up.
However, it is extremely important that agents, sellers, and buyers use vigilance and caution as they conduct themselves in pursuit of their real estate endeavors. It is critical for buyers, sellers, and agents to respect and follow the guidelines for social distancing. The use of a mask in public is becoming increasingly more the norm. The use of hand sanitizers and efforts to sanitize light switches and doorknobs are increasingly important. We encourage our buyers to drive in their own vehicles while we drive in our vehicle to protect from any contagion. We are encouraging sellers to leave the property for showings and to turn all of the lights so buyers and agents don’t have to touch light switches in the property. We encourage the buyers to enter the property ahead of us and we follow at least six feet behind. This provides the potential buyers an opportunity to see the property without the worry of social distancing and constitute safe practices to protect the buyer, seller and the agent. We are encouraging sellers to sanitize light switches and doorknobs on their return to further protect against infection.
if you want to sell your Ahwatukee-Foothills property, don’t get stuck on the sidelines. It is still a great time to buy or sell a property in the Ahwatukee-Foothills real estate market. More importantly, it is possible to conduct a real estate transaction safely, even amid the pandemic, if everyone involved conducts themselves prudently and follows the established guidelines to protect themselves and others.
As always, it will continue to be especially interesting to observe where this market goes in the coming days, weeks and months. Stay Safe, be blessed, wear a mask, social distance and wash your hands!
Pick your real estate agent wisely!
I am available for any questions
Henderson Real Estate
*Ahwatukee Foothills is the official name of an Urban Village in Phoenix. Ahwatukee Foothills lies south of South Mountain and South Mountain Park. “Ahwatukee Foothills” is comprised of zip codes 85044, 85045 and 85048. Some confusion occurs when some folks refer to Old Ahwatukee as “Ahwatukee” and “Ahwatukee Foothills” as a separate entity. So, for clarity, when we use the term “Ahwatukee” we are referring to the entire area designated “Ahwatukee Foothills,” including (85044, 85045, and 85048) unless otherwise noted.