Dec 19, 2023 - News

Phoenix housing market saw fewest sales since 2008

Data: Redfin; Chart: Axios Visuals
Data: Redfin; Chart: Axios Visuals

2023 proved to be unpredictable and sluggish for the Valley's real estate market.

Why it matters: Metro Phoenix saw 30% fewer listings hit the market than in 2022, per Phoenix Realtors, leading to fewer consumer options, tempered home value growth and a general sense of unease among potential buyers and sellers.

What's happening: Phoenix saw some of the largest home price increases in the U.S. during the pandemic-era housing boom. But when the Fed started hiking interest rates last year — and continued to raise them to a 22-year high this year — Phoenix's market also fell sharper and faster than almost any other major city in the U.S., Zillow senior economist Nicole Bachaud tells us.

  • The drastic change has left potential buyers confused and unsure when or if they should enter the market, she says.

What they're saying: "I don't think there's a Realtor in town that's going to miss 2023," Phoenix Realtors president Butch Leiber tells us.

By the numbers: Fewer listings came on the market in 2023 than any other year since the turn of the century, according to Leiber.

  • The Valley tracked just over 64,000 sales so far this year, the lowest annual tally since 2008, when the housing market crashed. In 2021, we saw more than 100,000 sales.

Between the lines: Many Arizonans who bought or refinanced their homes before 2022 have benefited from historically low interest rates, which are keeping them from moving and leaving would-be buyers with fewer options.

Zoom in: Prices wobbled throughout the year, with the median monthly home sale price rising for the first half and then falling slightly in the summer. At the end of October, the median price was $450,000 — about $25,000 higher than in January.

The intrigue: The Valley's luxury market didn't see the same slowdown, as many buyers seeking homes over $1 million are paying with cash and are not impacted by interest rates.

  • More than 4,800 homes have sold for more than $1 million in metro Phoenix so far this year, per Leiber. Prior to 2020, there were never more than 2,000 homes sold per year in this range.
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