Pricing Update Forecast for August 2018
I’ve noticed more than once that there are some properties in Scottsdale that have lowered their price. There could be many reasons for this, so I wouldn’t necessarily consider that it’s due to a major shift in the market. However, we have been in a seller’s market for more than 4 years, so the market is due to shift as it always does. Check out this months pricing update forecast.
Each month about this time we look back at the previous month, analyze how pricing has behaved and report on how well our forecasting techniques performed. We also give a forecast for how pricing will move over the next month.
For the monthly period ending August 15, we are currently recording a sales $/SF of $161.94 averaged for all areas and types across the ARMLS database. This is down 0.2% or 29 cents from the $162.23 we now measure for July 15. Our forecast range midpoint was $162.48, with a 90% confidence range of $159.23 to $165.73. The actual result was a little lower than the mid-point, but well within our 90% confidence range. We had expected a very slight bounce but we actually saw the usual 3Q decline continue a little further.
On August 15 the pending listings for all areas & types shows an average list $/SF of $165.44, down 0.6% from the reading for July 15. Among those pending listings we have 96.9% normal, 1.2% in REOs and 1.9% in short sales and pre-foreclosures. This mix is little changed from last month, with a small decrease in short sales and pre-foreclosures and another small decrease in bank-owned homes.
Our mid-point forecast for the average monthly sales $/SF on September 15 is $160.97, which is 0.6% below the August 15 reading. We have a 90% confidence that it will fall within ± 2% of this mid point, i.e. in the range $157.75 to $164.19.
So we are expecting the third quarter $/SF slump to continue during August and September. This will give us 3 months in a row of declining average $/SF.
It does not change the overall upward trend, which is likely to restart by October.