By Sean Colón
For only the fourth time in the last 25 years, Greater Phoenix is experiencing a buyer’s market, a rarity in the Arizona real estate landscape. Buyer’s markets occur when housing supply exceeds demand, typically leading to downward pressure on prices—yet, despite this shift, home prices have remained surprisingly stable. So, what’s really happening, and what should realtors expect in the coming months?
Why Aren’t Home Prices Dropping?
Despite being in a buyer’s market for three of the last four months, home prices have not yet declined. In fact, the median home price in Phoenix is up 4.3% compared to last year. The key reason is the delayed impact of supply and demand shifts on pricing. Unlike stocks, which can react instantly to market fluctuations, home sales follow a much slower process:
Listing Phase: Homes hit the market, and sellers wait (often 30+ days) for an offer.
Escrow Phase: Once a contract is accepted, it takes another 30-45 days for escrow to close and prices to be recorded.
Market Trend Confirmation: Only after several months of sales data do trends emerge that affect pricing expectations.
Because of this lag, price declines—if they happen—take months to appear in recorded sales.
Will Prices Decline in 2025?
The Cromford Report suggests that a price decline is possible but unlikely to mirror the 2008 crash. Instead, the market may experience a gradual glide downward if supply continues to rise. Historically, recessions do not trigger home price crashes—instead, prices tend to stabilize or grow modestly due to lower mortgage rates increasing buyer demand.
However, interest rates remain the wild card. If rates drop to 6.1% or lower, demand will likely surge, stabilizing prices. If rates stay at their current levels or rise, pricing will likely adjust downward to correct the excess supply.
What This Means for Arizona Realtors
In this shifting market, Arizona realtors need to adapt their strategies to ensure success:
Educate Sellers: Help clients set realistic pricing expectations. Overpriced listings may stagnate in this market.
Highlight Buyer Opportunities: With increased inventory and negotiable prices, buyers have more power—capitalize on this when marketing homes.
Stay Ahead of Interest Rate Trends: Follow mortgage rate fluctuations closely. Lower rates could trigger a sudden buyer influx, changing market dynamics quickly.
Leverage Professional Photography & Staging: In a market where buyers have choices, high-impact listing photos and strategic staging can make all the difference.
Final Thoughts
Greater Phoenix’s current buyer’s market is a rare event, but that doesn’t mean a crash is coming. Instead, realtors should prepare for a measured market adjustment, watching interest rates and guiding clients accordingly.
Want to stay ahead of market trends and maximize your listings? Stay tuned to our blog for expert insights into Arizona real estate photography, marketing strategies, and buyer psychology to help you thrive in 2025!
By the way, I help realtors improve their online and social media presence by providing beautiful photos of their listings. That is why I’ve created this FREE HOME PREP LIST for your clients to help your listings look their best. Feel free to share.