The following serves as a narrative arch from a macro sense of the Phoenix Metro market and its cyclical market expressions over years and longer periods of times.  The narrative although is not relevant to the recent considerations in the current marketplace that are affecting the local market conditions:

Historically, in general the Phoenix Metro market most negatively affected by volatile market conditions in macro terms (including both Maricopa and Pinal counties), are those areas with the greatest concentration of subprime loans originated between the years 2003-2007.  In general, the late stages of 2005 and the first half of 2006 first appeared to reflect downward pressure on pricing with an increase in listing inventories in many areas.  Additionally, outlying communities with significant new SFR construction, with lower price points have been adversely affected to the greatest extent. Core areas with established infrastructure have out-performed these outlying areas in terms of overall market value decline.  

Beginning in second and third quarter of 2011 the markets showed signs of stabilization and recovery by virtue of markets housing inventories expressing three to four months or less of housing inventory. The housing inventories have commonly conveyed in many markets below the commonly held notion of "balanced" (i.e. three to four months of housing inventory) where the demand for trailing periods of three to nine months of housing absorption rates is greater than the supply of SFR's as listings.  Succinctly, it appears that certain markets are prudently reported as balanced and a trend toward a Sellers market.  
Proficient real estate professionals across Maricopa and Pinal counties initially reported a significant drop in inventory coinciding with the national foreclosure moratorium from publicly traded national banking institutions in the highly publicized "robo-signing" of trustees notices.  Following the moratorium, the national multi-billion dollar settlement concerning the five largest mortgage services in the 1st quarter 2012 set the stage for conditions conducive to typical macro market conditions which may have lead to the Phoenix Metro market's noted rates of appreciation.  Unequivocally, Phoenix Metro (Maricopa and Pinal counties) as reported by two leading index agencies (Federal Housing Finance Agency and Case-Shiller) lead the entire US domestic markets for overall appreciation for the period of late 2011 (3rd quarter) to late 2012 (4th quarter).  

Phoenix Metro has conveyed and expressed robust appreciation rates from a macro perspective starting in third quarter 2011 until third quarter 2013, however, it should be noted that recently, intrinsic relative quantitative changes in the market most notably the relative increase in mortgage lending rates since second quarter 2013, the decrease in the raw number of resales, an increase in the raw number of listings, and continual subsiding foreclosures have conveyed and expressed a relative increasing trailing monthly housing supply which has resulted in downward pressure on the markets as a whole.  The downward pressure on the markets appear to have staved off the prior relative robust appreciation rates to more conventional appreciation rates starting in the fourth quarter of 2013.  The downward pressure from a fundamental perspective have caused some of the segmented submarkets to convey One-Unit Housing Trends as Stable as early as the first and second quarters of 2014. Additionally, from a macro perspective increasing housing supply  in the second and third quarters of 2014 has applied modest downward pressure on the markets as a whole relative to prior recent time periods in late 2013 and early 2014.   The years of 2014-2015, Phoenix Metro widespread experienced appreciation and in some localized markets in proximity to infrastructure experienced robust appreciation as job creation reporting was gaining momentum and interest rates were at lower than typical pricing.  

The following serves as a current overall commentary regarding the Phoenix Metro’s economic conditions that are impacting the overall market area:

2016 was a year of housing supply balancing out and conveying monthly supply of traditional eras of similar balance and in turn stable price points with some areas experiencing nominal appreciation.  2017 has followed the same trends and market stabilization with areas located closest to supporting infrastructure conveying market appreciation rates.  Gentrification and development "in-fill" projects and one-off site developments are a trend as of late within these areas most proximal to supporting infrastructure.  2017 conveys robust job environment and population growth in the positive for Phoenix Metro which are the driving factors in the appreciation rates noted and at a minimum the market stabilization starting in 2016 and to beyond.  Investor demand from both inside and outside Phoenix Metro has been robust, a recent study (ATTOM Data Solutions) in Q2 2017 the county of Maricopa lead the entire country for number of "flips".  2018 has expressed strong indicators in the residential real estate market for Phoenix metro thru the first two quarters of activity both in price stabilization and in some areas appreciation.  Localized markets in proximity to infrastructure, upper echelon ranked public/private schools, retail centers, public transportation, and employment centers are expressing robust appreciation.  Recently record low unemployment levels, robust job growth, compressed lending interest rates, and high net positive immigration to the state have all contributed to the early 2018 positive trends for real estate pricing and metrics.  In-fill projects continue to be an emphasis for builders and investors for submarkets near the aforementioned higher level supporting infrastructure.  New construction and re-engineered existing building stock (remodel projects) have trended toward higher fenestration levels (larger natural light openings) and inside/outside living concepts for homes generating the highest sales metrics ($/SF).

To establish additional support regarding Phoenix Metro, and namely Maricopa County’s robust economy and overall improving macro economic conditions over the course of 2012-2017, the appraiser cites an article reported by Phoenix Business Journal.  Maricopa County from this five year period has lead the entire country for counties in terms of people moving from outside and into Maricopa County.  Positive net migration is a core component to robust local economic growth.  Maricopa county saw 221,000 people for inbound migration:

In early 2019, it was reported by the Phoenix Business Journal that Maricopa County was the fastest expanding county in the entire country from 2017-2018:

Additionally, the metrics for the Arizona economy continue to be robust with the GDP expanding at fourth best in the country at 4% in 2018 as reported in second quarter 2019:

Early 2020 economic data for the state of Arizona continued with reporting conveying the improving economic conditions that were unprecedented and largely unrivaled by all other states in the US.  In February 2020 the Phoenix housing market lead the entire country for year over year price changes (Case-Shiller).  In late February 2020 the Bureau of Labor Statistics reported that of the 10 largest counties in the US, Maricopa County reported the largest increase in job growth in terms of percentage increase (+3.2%) for the entire country from 2018 Q3 to 2019 Q3.  Bureau of Economic Analysis in April reported that Arizona was the third fastest expanding statewide economy from 2018 Q4 to 2019 Q4 at 3.3% in the entire US.  The following hyperlinks are the sources for the aforementioned reporting:

Though the first half of 2020 has been defined as tumultuous and unprecedented times since the CoVid-19 pandemic has had its effects socially, economically, and in migration patterns.  From March until May the real estate economics were largely stilted and without any numerable statistics of relevance to report due to the vastly small volume of sales data as Arizonans were in large scale self isolation and quarantine.  In stark contrast, June, July, and August were months with improving economic conditions with record low interest rates, low housing inventory (house listings in summer 2020 were at record lows all time), increase in inbound migration demand, and the Arizona economy showing resiliency as federal agencies reported the state as having the third lowest unemployment rate in the nation.  Despite the pandemic, the summer months showed strong and resilient metrics in housing prices across all price points.  Migration patterns have been both anecdotally reported (interviews with developers, luxury brokers, interior designers and mortgage brokers) and empirically reported by digital online services and national bureaus as being robust with Arizona drawing inbound homeowners departing from California, Washington, Colorado, Illinois, and New York most notably.  

Additionally, the summer of 2020, Case Shiller Index reported Arizona as having the highest year over year appreciation in the nation at +9% from June 2019-2020.

August 2020, Case Shiller reported year over year price increase at 9.9% which continue to lead the nation and almost twice as high as the national average of at 5.7%.  Inventory continue to be below historic norms hovering between 1-2.5 months of inventory.

The luxury or high-end markets have performed in unprecedented fashion for June and July of 2020.  These two months were coupled as having the highest ever individual months of sales volume exceeding $500,000 in sales price, with July being the highest ever at 1788 total sales per The Cromford Report.  The Cromford Report also reported July as having the highest sales ever for homes selling exceeding $1 million.

​ Additionally, the luxury submarket (sales prices exceeding $1,000,000 and above), for 2020 might be considered the most voluminous and robust that Arizona has ever experienced.  At the very utmost echelon levels of the market, recently sales have eclipsed the $20,000,000 levels and setting all-time records.  Sales data from the $1M to $6M range is up over 138% when compared to last year (2019).

Winter 2020 continued to convey improving economic conditions in the robust Phoenix metro housing market with data agencies reporting that sales activity and price metrics were some of the highest levels on record as inbound migration patterns continue to increase, mortgage interest rates at or near all-time lows, and unemployment figures receding with an improving dynamic statewide economy.

Early 2021 and mid-spring 2021 continued to build on the aforementioned economic conditions.  A panel of lead economists nationwide viewed Phoenix metro as the second "hottest" housing market forecasted for all of 2021 according to Zillow:

Anecdotal interviews with top producing sales brokers and agents are reporting "bidding wars" and many well priced listings receiving accepted offers above list price as the inventory levels continue to be at all-time lows.  The demand continues to stay strong and swell even in the luxury markets and high-end markets as inbound migration patterns show buyers who are leaving metropolitan areas such as Denver, Southern California, Seattle, Portland, Chicago, and New York peg Phoenix metro as a destination for housing.  According to Redfin real estate news, Phoenix is the top destination for a record number of wealthy buyers to relocate from expensive wealthy coastal metropolitan areas:

Economically, Arizona's economy ranks in the top six states for the first quarter of 2021 for economic expanding GDP (2.06%) according to the Washington D.C. State Policy Reports.
  This robust figure underscores one of the many reasons Arizona's real estate market is improving and continues to be resilient since the CoVid pandemic.

Phoenix Metro is the second fastest metropolitan area where affordability is shrinking in relative terms due to rapid appreciation over the last year from 2020 March to 2021 March, where for the 22nd consecutive month, the market of Phoenix Metro has lead the country in appreciation rates topping 20% annualized (average home price is up 24.8% from a year prior). 

Per The Cromford Report, June 2021 saw the lowest distressed inventory sales on record all time.  Cromford also reports the average sales price in May was the highest ever.  Inventory currently hovers at 76% below normal rates; this is a big driver partly of price appreciation in Phoenix Metro.

Phoenix Metro continues to see rapid price increases in the third quarter 2021, as the Case Shiller Index reported that year over year gains for Phoenix Metro lead the entire country as reported in September (June to June data) at +29.3%.  This is the 25th consecutive month in a row for Phoenix Metro leading the country in appreciation rates.

In summer 2021, news broke with respect to a high tech semiconductor plant breaking ground in North Phoenix as Taiwan SemiConductor Manufacturing Co. is developing a multi-phase plant that will span over two decades of construction and confirmed total investment of $12B with some speculation that a secondary phase to the plant will cost in excess of $23B.  The plan will undoubtedly add 1900 high tech and high wage jobs to the Phoenix Metro job market.

In fall 2021, Intel continued the robust semiconductor streak of investment in Phoenix Metro as it announced two more plants underway with a total investment of $20B.  The added plant will bring construction jobs and high wage tech jobs to the already burgeoning job market in Phoenix Metro.

Fall and Winter 2021 the macro-economic conditions sowed signs of volatility on the side of supply chain (materials shortages due to Covid disruption and high demand in construction) and labor compression (subcontractors and craftsmen shortage due to high demand in construction) in the housing market.  Prices in both categories (materials / labor) have been reported across all sectors as rising dramatically.  It remains to be seen whether the inflationary conditions Phoenix Metro is experiencing Q3-Q4 2021 are transitory or more permanent.

November 2021 Zillow, the nations largest iBuyer and data analytics firm announced it was no longer in the business of buying, selling, and remodeling for profit as a quarterly loss over $420 million in Q3 2021 was reported.  Zillow cited unpredictability in forecasting home prices and it is implied they faced issues with remodeling for profit in their business model.  Zillow is selling all of their inventory in Phoenix Metro which will undoubtedly add additional inventory to an already tight inventory status Q3-Q3 2021.

2021 Phoenix Metro continued its robust appreciation pace as it lead the country once again in year over year price increasing rates from October 2020 to October 2021 at +32.3% county wide (prudent to differentiate between macro and borough specific submarkets as appraisers professionally do), albeit the appreciation rates ten to be "leveling-off" or "cooling" as the winter months are in session.  It remains to be seen as whether the cresting of percentage rate increasing are seasonal or fundamentally macro.

Phoenix Metro continues its nationwide leading appreciation rates as Case Shiller reported in January 2022 that as a metropolitan area its year over year price change was +32.2%.

Ultra luxury deals have been a robust sector within the macro market as sales over $10M are up in sales volume over 10% from last year.

The luxury market between $1M and $10M has been just as competitive with a lack of reporting inventory and a velocity of money increasing with marketing times decreasing and sales volume increasing at historic levels.

The landscape of the real estate market is unequivocally ever evolving.  The motivations and reasons for the migration patterns nationwide and especially Phoenix Metro appear to be accelerating due to the CoVid Pandemic as companies and businesses have offered "work from home" status employment.  The new paradigm of flexibility in the economy has spurred proliferating migration rates and patterns.  The academic report released March 2022 reports that a robust figure of 9.3% (18.9 million) of Americans plan on moving because of remote work compared to 6.1% in October 2020.  The paper suggest that "long term movers" are a growing figure within the 'work from home' sector.

Housing inventory continued to be an issue, as inventory currently stands at 0.6 months in early 2022 (a traditional balanced market is 4-6 months of inventory).  Final list prices are receiving on average 99.9% purchase prices which is unprecedented for the Phoenix Metro market area.  Compression is also being conveyed on the side of marketing times, days on market year over year has dropped 20% to just 33 days on average for Phoenix Metro.

Affordability for the area is becoming a challenge with the price increases.  March 2022, Scottsdale was reported to be 20th least affordable city in the entire country.  Other notable cities for the county came in at the top 65 least affordable in Glendale (26), Mesa (31), Phoenix (37), Tucson (41), Chandler (61), and Gilbert (65).

One of the drivers of the price increases is the local job market, and construction / development is a major sector for Phoenix Metro with analysis in the following fields of single-family, multifamily, office, industrial, and self-storage.  A recent study pegged Phoenix Metro as the 4th strongest and most robust in the entire country for the preceding decade.

Demand is surging for investors market share in the Phoenix Metro area per Redfin.  Redfin recently reported $3.8 billion (Q4 2021) was exhausted by investors for Phoenix Metro, this is the second largest investor volume in the country in a category of 40 of the largest metropolitan areas in the country.  This equates to 28% of all homes in the market being bought by investors for the fourth quarter 2021, which is 5th highest rate for the entire country.

Late Spring 2022, empirical data was released confirming the unrivaled appreciation rates that Phoenix Metro is continually experiencing relative to the competing rest of the United States.  Late March 2022, RE/Max, a leader in residential brokerage reported that of the 51 metropolitan areas, Phoenix ranked number 2 with a February year over year change at +28.6%.

Additionally, Case-Shiller, on e the nation's leader in real estate metrics reporting, conveyed that Phoenix Metro increased +32.6% year over year change from January 2022  to January 2021, which was number one in the nation.

Migration patterns from domestic inbound movers continue to bolster the demand for housing in Phoenix Metro.  Early March 2022, the US Census Bureau released its findings in migration and population patterns from its study covering 2020-2021 during the CoVid pandemic.  Overall Maricopa County as a county added the most domestic US inbound citizens leading the entire country with +46,866.  As an MSA, Phoenix-Mesa-Chandler lead the entire country with positive net domestic migration at +66,850 new residents added.

In March 2022, a new shift in increasing mortgage interest rates due to the Federal Reserve raising its benchmark interest rate to curb inflation (highest levels of inflation in four decades) caused for pause in mortgage applications and a potential cooling effect on the robust housing market's appreciating values.  Mortgage rates spiked 24% in March and are now at rate level not seen since 2011 (4.5-5.25%) as reported in March and April 2022.  With Redfin reporting that a record 80% of homes are being purchased by investors who are typically cash buyers and therefore less sensitive to rate increases, it remains to be seen how much of an effect the rate increases will have on the housing market.  Certainly, first time homebuyers it will impact.

The real estate market is an ever-evolving machine.  Since the inflation picked up steam in mid-2021 and carried into 2022 at record levels, the stock market's volatility, and the rising interest rates across all levels of leveraged debt (housing, personal, auto, business credit lines), many economists and new outlets are reporting a cooling or slowdown in the economy, with some even forecasting a recession looming.  This remains to be seen, and each real estate market is local with varying degrees of market participants at all price points.  Nevertheless, these evolving attributes that will likely change the real estate market will continue to be monitored fervently and closely by the appraiser.

It appears nationwide the trend toward asking price reductions is amplifying with respect to prior recent periods.  Also noted is the inventory of available housing stock is increasing.  These characteristics should give rise to a more competitive market especially for the Buyers pool.

Home prices nationwide climbed to an all-time high per CoreLogic in March 2022.  Largest measured growth reported in the 45 year metric tracking history.  Homeowners payment-to-income ratio stands at 32.5% which is just 1.6 percentage points shy of the record set (34.1%) in July 2006 according to Black Knight.
Phoenix when compared to national metrics surged passed the national average and ranks in the top 10 MSA's for price appreciation annually (+27%).

Recently, reporting agencies have uncovered one of the main drivers of market participants at unprecedented levels, the investors or private equity buyers.  According to research, a full 1/3 of US homes were purchased by investors in January 2022.  This is the highest level ever reported.

Mortgage interest rates have risen from April to June in 2022 at their fastest pace since the rates have been tracked dating back to 1987.  Experts all over the country have weighed in that the impact on the housing market will claw back on demand as applications for mortgage financing are down over 16% year over year comparison.  Affordability continues to be a concern for those living in Phoenix Metro.  Inventory reporting is starting to pick up in Phoenix Metro by June 2022.  Experts range from cautioning a housing correction modest estimate to a stable pricing estimate in the near future.  It remains to be seen what impact the rising mortgage lending rates have on the real estate market especially after the last two years of the reported record appreciation rates.

Since the historic rise in mortgage interest rates commencing in Spring 2022, the real estate market has been  in a state of flux and volatility.  Mortgage expenses reported to skyrocket by roughly 50% in a matter of months.  Demand in sales activity has decreased across all price points and all areas in Phoenix Metro.  Inventories have been steadily increasing across Maricopa and Pinal counties as the market shifts from a Sellers market to a more balanced or neutral market.  Trailing data as recent as early July reported that Phoenix price growth from May 2021 to May 2022 surged to +27.3%:

It should be noted that majority of economic reports are forecasting a drastic slowdown in the pace of appreciation for the foreseeable future.  CoreLogic for example, reported an annual price appreciation slowing to 5% by May 2023.

Almost a quarter (24.5%) of all home-purchase agreements in Phoenix Metro were cancelled in June 2022 according to Redfin as a result of increased borrowing costs:

Mid July 2022 the first economic data reported by ARMLS showed for the first time in four years a price drop of median prices of approximately $10,000 from May 2022 ($510,000) to June 2022 ($500,000).  It remains to be seen how much an effect the rising mortgage rates will have on the market in general:

Economists have yet to have complete consensus on the future of the American economy as conflicting data points are at odds with one another (inflation vs unemployment rates at record low levels):

​The demand for Buyers in the Phoenix market per Redfin's proprietary data, conveyed that the metropolitan area is least competitive in relative terms when it comes to listings that face "competitive buyers / bidding wars".  Phoenix showed a July 2022 bidding war rate at just 26.6%, which is less than half of the bidding war / competitive buyers rate where the metric stood just one year ago (53.9%).  Bidding wars nationally have declined for six straight months as the market cools and rebalances toward a more traditional market.

Nationally, US Census report that vacancy rates and rental rates continue to hover at near historic lows as the homeownership rate climbed to 65.8%.

Despite a cooling housing market, the migration patterns and migration intent continues to rant at an all time high per Redfin.  July 2022, Redfin reported that approximately 33.7% of their users were searching for homes in different metropolitan areas, that's the most since 2017.  Phoenix ranks 6th on the list of the most queried markets for all the 100 plus metropolitan areas searched.

Metrics for Phoenix continued to change as inventory or new listings for year over year change was reported at 34.1%, which was second most out of the fifty plus metro areas surveyed according to Re/Max brokerage.  The continued increase in metrics are applying downward pressure on the market, and logically, the median sales price for Phoenix slid -3.6% ($460,000) in July 2022 relative to the high reported in June 2022 ($477,000).  Number of homes sold annually has fallen over 25% since July 2021.

Phoenix metro from a decade longitudinal study (2011-2021) stands as one of the best performing city metros (top4 in the nation) from a percentage of change in price as recently reported August 2022.  Growth over this time period was reported at +259.65%.

iBuyer technology firm and real estate group Opendoor, which is a large market participant in the Phoenix metro market, recently reported losses on 42% of its transactions and as much as a negative $175 million in adjusted earnings.  Opendoor has been selling their inventory in Phoenix metro at a quicker pace as the market shifted from early spring to early summer in a sellers to buyers market.

Due to the increase in home price and the robust nature of the inbound migration patterns, it was recently reported that Phoenix metro leads the nation in inflation (+13%) of the 22 metro areas studied by the Bureau of Labor Statistics.

Volatility in sales volume continues to be a theme as a recent report indicated that Phoenix metro made the list for one of the top four market where buyers are cancelling contracts in summer 2022, largely due to the lack of affordability reported.

Median home prices in Phoenix metro slid $20,000 ($440,000) from June to July recently.  This is the second straight month of decreasing median home prices from the peak of $465,000 in May 2022.  The July median price is still well above the years prior median price by more than $45,000 in 2021.

Appraisal waivers which are essentially the loan consideration underwriting's option to decline the need for collateral (house in consideration) to have an updated valuation assigned to the audit have been a growing trend since mid 2019 as more lenders and GSE's opted for a quicker approval process.  Appraiser waivers depend on the creditworthiness of the borrower, the risk of the intended use of the loan and other factors.  Recently though, the appraiser waivers have tapered off in sheer volume as the spike in interest rates have staved off the volume of refinances whereby most the prevalence sits for these types of expedited valuation processes are utilized.

Single family homes had a median sales price of $470,000 in September 2022, down from $475,000 the previous month and from its peak of $510,000 in May 2022.  Prices in Phx Metro appear to be normalizing and they subside from their peak values in early summer 2022 as listing have increased in volume and demand has cooled down with the dramatic rise in interest rates.

Money Magazine recently named Tempe as the number two city in the entire country to live in terms of "50 Best Places to Live" as the category weighed a myriad of factors including economic metrics, low levels of unemployment, quality of life, diversity, and opportunities in the future.  Affordability was cited as an important metric for Tempe, as was proximity to infrastructure and civic life options.

Arizona was named as the 6th best state for retirees by Better Benefits which included a number of factors (avg retirement length, in labor force, households w/retirement income, mean retirement income, below 100% of poverty level, US retirement score).

Nationally, the landscape for metrics in the residential real estate market is changing for Buyers and Sellers as demand continues to wane and listings continue to increase which results in a more competitive Buyers market according to RE/MAX as home sales across 53 major metro areas has declined 9.7% thru September and October 2022 from August 2022, first time inventory grew to a two-month supply of housing since November 2020.

Arizona as a state continued to be a large draw for international homebuyers as Coldwell Banker International Buyers Guide reported the sunshine state to be the 4th highest in demand for international homebuyers.

Buyer demographics continue to shift in 2022 as Millennials (ages 23 to 41) represent a burgeoning segment of buyers encompassing roughly 43% (80 million) of all homebuyers according to the National Association of Realtors.

Competition with savvy investors, namely institutional financed groups and traditional buyers continues to add difficulty for conventional buyers to acquire the homes they desire.  Recent data reported forensically that in 2021 alone, investors acquired as much as 31% of all single family homes as published by The Pew Charitable Trusts.

Phoenix Metro continues to be a national player on the stage of competing markets for development as metrics in localized economics lend for support of developers and builders to stake new projects in the ground.  According to the Emerging Trends in Real Estate report by PwC and Urban land Institute, they rank Phoenix as number 9 with the best cities for real estate prospects in 2023.

Shifts in the marketplace have occurred as recent as October 2022 as reported by  Nationally, the number of houses on the market is up 33.5% (year over year) and over 92% of successful contracts have been negotiated with "buyer-friendly terms" per a survey completed, and days on market is up over 13% (year over year).  Anecdotally, sellers are reporting more favorable terms with the recent increase in "mortgage rate buydowns" at the expense of the seller due to the rapidly increasing mortgage rates as reported.