Michael Orr, Founder and Owner of The Cromford Report, breaks down the most recent housing market data in the Arizona Journal of Real Estate & Business:  "Below $175,000 there are just over $1,000 single-family homes offered for sale.  It is worth remebering how this contrasts with June 2011 when there were over 14,000."

I can attest to this observation by Mr. Orr as I just closed a transaction in this price range on the buy-side. My clients ended up purchasing a nice end-unit condo at 3rd Avenue Palms in Phoenix.  It was not easy, as a competing offer came in the first day the property came on the market, and was a full-price cash offer. The upside for Buyers who are successful in this price range range of scarce inventory is appreciation.  Mr Orr writes, " . . . anyone trying to buy a single-family home under $175,000 is going to be faced with a very high level of competition from other buyers, which drives prices up and aggravates the supply problem yet further."

Moving further up the price range, we see moslty vibrant activity until the 1.5M and above mark.  From $200,000 to $500,000 there are more listings than the previous two years, yet high-frequency sales are carving out existing inventory.  Orr writes, " . . . the annual sales rate has increased almost 50 percent from 20,012 to 29,982, so the extra supply is completely dwarfed by the growth in demand.  Inventory has declined from 134 to 96 days which means sellers have the advantage and so continued appreciation is in the short-term forecast."

The pattern continues, albeit to a lesser extent in the $500,000 to $1,500,000 price range.  The listings count is higher than 2 years ago, however sales counts have increased even more.  Therefore, price pressure has impacted this segment of the market also.  Orr states, "So here we can see that the growth in demand is faster than the growth in supply and after a weak period since peaking in mid-summer 2015, prices in most luxury areas are on the rise again,  particularly for homes under $1.5 million."

Above 1.5 million there are more opportunities depending on where you are shopping for a home.  However, in some neighborhoods, such as the Arcadia Neighborhood of Phoenix, we are increasingly seeing tear downs and rehabs changing hands quickly.  Many of these properties are sold without posting to the Multiple Listing Service.  In the "Arcadia "Proper" neighborhood of Phoenix, the activity is jaw-dropping.  There are teams of construction workers bringing-to-life the dreams of affluent entrepreneurs and established business owners.  However, this is an exception to overall sales activity in the 1.5M plus price category.  Mr. Orr observes, "We can see that inventory is over 600 days from homes priced above $1.5 million, and here annual sales have risen from 547 to 596, and increas of only 9 percent, while supply is up from 1,030 to 1,140, a rise of 11 percent.  Now we see a problem.  When supply increases as a faster rate than demand, sellers are at a disadvantage.  Pricing will have a hard time making substantial upward progress until this condition changes."