Drop in MLS Listings, Inventory May Signal Phoenix Housing Market Turnaround

Nov. 1 may mark the date the Phoenix housing market heaved a sigh of relief.

On that day this week, the Multiple Listing Service reported a drop in resale listings from the end of September to the end of October - from 46,390 down to 46,228. This figure includes 4,600 new homes.

“It only went down a little, but it went down,” said Mike Chasse, senior home builder adviser with Scottsdale-based Land Advisors Organization. “I’ve been antsy for two weeks (for the MLS monthly update) because I was seeing signs the market was balancing out,” he said.

The listings dipped for the first time since March. Before that, it had been exactly a year since home mortgage loan applicants were so active that inventory actually decreased in the area.

Sales topped out at 5,468, an increase of 40 from last September. According RL Brown Housing Reports in metro Phoenix, 2,281 permits were issued in September, a decrease of 733 permits from August.

Calling it a “milestone,” Chasse said, “I hope it stays and keeps coming down … we may be looking back as this moment as this being the floor of the market.”

A balanced home-sale market, he said, would be in the 33,000 listing range.

The drop might not be just sales, but people taking homes off the market, Chasse said. Still, “we’re on track with the trend I thought was coming. We didn’t hit 50,000, which we feared we might get to.”

Chasse went on to predict “a little bounce by mid-year” as he thinks more and more people will come to the area and seek home mortgages.