The crash of the housing market was notoriously fast and furious in Metro Phoenix. The ‘first-in / first out’ surge of activity we see today marks a lower-end market on fire—the result of the price clock dialed back a decade; the inventory of homes being depleted faster than new listings can replace them; and investors and first-time buyers fiercely competing for what inventory remains.

However, this 30 thousand foot level view misses a landscape of diverse market dynamics that follow from community and price range factors.

For example, while Metro Phoenix first quarter year-over-year sales are down, sales are up in the NE Valley’s resort corridor of Arcadia, Paradise Valley, Scottsdale, Carefree and Fountain Hills.

More specifically, year-over-year sales are down 8% Valley-wide, though not for lack of demand, but lack of inventory–down 40% from a year ago! 58% of current sales are in the distressed category–down 20% from a year ago. There’s only a 2.6-month supply of homes for sale and home prices average $183,000–up 15.5% from last year.

In the chart below we see both 2012 appreciation compared with 2011 and an overlay of the current ratio of distress to normal sales.


By contrast, when you narrow the focus to Scottsdale, year-over-year sales are up 25%. Home prices average $480,500, and there is a 4.4-month supply. That’s almost a 40% decrease in the month supply, with fewer than 30% distressed sales. And as you can see below, prices are up 6.4%.


Looking more broadly to the NE luxury resort corridor, the trend is clear:

We are seeing a trickle-up recovery moving to the mid/upper-range homes in the NE Valley, extending up to 2.5 million.

Naturally, as you climb the price-range ladder, the month supply goes up as well. However, even in Paradise Valley, where the average price is 1.4 million, the month supply is 10 months—down 40% from a year ago.

Sellers: Best opportunity in 5 years.

Buyers: Better hurry!