Phoenix's real estate market is finally calmer, but it's not cheaper

Yes, but: Rising borrowing costs are squeezing homebuyer budgets and causing home sales to slow, per a recent Phoenix Realtors analysis.

What’s happening: "We're returning to a more normal, stable market with more even supply and demand," said Andrea Crouch, president of Phoenix Realtors.

• Current buyers have more homes to choose from and competition has eased. But the leap in mortgage rates has kept some folks out of the market, Crouch said.

Of note: In 2020, Phoenix households had to earn at least $41,855 annually to spend 30% of their monthly earnings on a typical home mortgage payment, Zillow found.

• This year, you needed to make $85,618.
• A monthly mortgage payment is considered affordable if homebuyers spend no more than 30% of their income on housing.

By the numbers: Inventory jumped 136.7% compared to this time last year, per Phoenix Realtors’ market activity report for the week ending Sept. 24.

• Meanwhile, pending sales are down 61% year-over-year.
• The median sales price rose still 10.6% year-over-year, but it’s fallen in recent months.
• For example, in May, the median sales price was $510,000 and in August it was $475,000.

Sellers aren’t getting 100% of their asking price anymore. On average, homes sold for 98.1% of the list price in August 2022.

• This time last year, homes were selling for 101.6% of the listing price.
• Flashback: About half of Phoenix-area sellers dropped their asking prices in July.

Homes are sitting on the market longer, too. In August 2022, homes sold in 41 days on average, compared to 28 days in August 2021.

What’s next: The housing market is correcting — not crashing, Crouch said.

• This winter, Crouch expects to see even more listings, along with more cautious buyers.

Go deeper: Experts tell Axios Phoenix the cooling market is not cause for concern.