Buyers gain upper hand in Valley housing market
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It's a homebuyer's market nationally — if you can afford it — and in few places is that truer than the Phoenix Valley.
The big picture: There are nearly 500,000 more sellers than buyers in the U.S. housing market, Redfin estimates.
Why it matters: That's the widest gap on record — and a big reversal from just a few years ago, when buyers were desperate to find a place to live, sending prices into the stratosphere, Axios' Emily Peck reports.
By the numbers: There are 33.7% more sellers than buyers now. At no other point since Redfin began tracking in 2013 have sellers outnumbered buyers by such a large percentage.
- A year ago, sellers outnumbered buyers by 6.5%, and two years ago, buyers outnumbered sellers.
Context: Redfin counted sellers as the number of active listings in a given area and created a model to estimate the total buyers.
Zoom in: Sellers outnumber buyers in the Phoenix area more than almost anywhere in the U.S.
- There are twice as many sellers (about 32,400) as buyers (nearly 16,200) in the Valley.
Where it stands: The one-two punch of still-soaring home prices and mortgage rates is making it hard for buyers, especially first-timers, to find a place they can afford.
- Add to that the extreme economic uncertainty of 2025. Tariff news, layoff fears and, for many federal workers, layoff realities, are tamping down buyer demand.
Yes, but: For homesellers "the mortgage rate lock-in effect is easing," per Redfin. "For most people, it's not realistic to stay put forever; job changes, return-to-office mandates and divorce force people to move."
- Elevated mortgage rates are becoming the norm. "The idea of taking on a higher mortgage rate also isn't as shocking as it was when rates first skyrocketed in 2022."
Between the lines: Buying a home remains out of reach for most Americans, as the National Association for Realtors pointed out in a recent report.
- The median home price sold in the U.S. in the first three months of this year was $417,000, per federal data — 33% more than during the same period in 2019, before the housing market went haywire, outpacing inflation and incomes.
- Tina Tamboer, senior housing analyst with The Cromford Report, told the Arizona Republic that home prices could drop 3%-5%, but people shouldn't expect "big, bold movements" anytime soon.
The other side: Mark Stapp, executive director of the Master of Real Estate Development program at Arizona State University, was skeptical that there are twice as many sellers as buyers in metro Phoenix.
- He said there are about 26,000 houses currently for sale in the Valley, which doesn't count new homes.
- "The market is still out of whack to some degree, and it hasn't corrected itself. We need five or six months of inventory for this to be a real buyer's market," Stapp told Axios, saying there's about 3.6 months of inventory now.
- Home prices aren't falling, they're just getting more realistic compared to the high prices sellers had been seeking, he said, and we're likely to see modest increases of about 3% in the Phoenix area.
What to watch: Historically, when sellers outnumber buyers, prices drop. And in some markets, listings have already started falling.
- Redfin believes prices will dip 1% by the end of the year (not exactly a huge discount, to be sure).
The bottom line: "The balance of power in the U.S. housing market has shifted toward buyers, but a lot of sellers have yet to see or accept the writing on the wall," said Redfin senior economist Asad Khan in the report.