Continued signs of strength for the Phoenix real estate market are shown in the Pending home sales. Pending homes sales in the metro Phoenix area are now registering a 5 month high on the Multiple Listing Service, MLS. With the increase in Pending home sales, results a drop in months of inventory based on Pending homes. Sales have increased each week as we have moved into the new year and are moving towards more normal levels. As demand increases, supply decreases. Or in our case the growth of supply decreases. You can see on the chart the down turn months of supply has taken based on the recent growth in Pending sales. This Chart goes back to 2005, when it was a seller's market.
Reviewing 2007, the chart shows how the market began to recover from the real estate slow down of 2006. In the first couple of months of 2007 Pending home sales jumped. Then "sub prime I" happened in march of 2007. The market turned abruptly and continued on a step path to a buyer's market. Since the beginning of this year the months of supply has peaked and is moving lower. Continued growth in sales along with a decrease in supply will continue to move our market to a more balanced state.
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