By Sean Colón
If you’ve been feeling a shift in the Phoenix housing market, you’re not imagining things. Greater Phoenix has officially been in a buyer’s market for three out of the last four months—and it’s continuing into spring 2025. But before you cue the alarm bells for your clients, let’s get one thing straight: this isn’t 2008, and the sky is not falling. What we’re seeing is a measured correction, not a collapse—and for savvy Arizona realtors, that means opportunity.
For Buyers: A Market That’s Quietly Tilting in Their Favor
Right now, prices haven’t started falling dramatically—but don’t be fooled. Median home prices are actually up 4.3% year-over-year, but that doesn’t contradict a cooling market. Price measures always lag behind shifts in supply and demand by 3 to 6 months. Why? Real estate isn’t like the stock market. Listings take time to hit, contracts take time to negotiate, and closings take time to record. Add in two more months to establish a price trend, and you’ve got a slow-moving but predictable curve.
This marks only the fourth buyer’s market in Greater Phoenix over the past 25 years. The 2006–2008 crash still haunts many, but the data doesn’t support another freefall. In fact, historical trends show home values tend to stabilize or creep up slightly during recessions, not tank—mainly because mortgage rates often decline during economic slowdowns, which actually boosts buyer demand.
That said, there are nuanced trends worth noting: condos and townhomes under $400K are seeing the sharpest value dips, currently down 4.2%, while luxury homes in the $1M–$1.5M range are enjoying 5.5% appreciation. With inflation still outpacing price growth in most categories, any dip in mortgage rates could significantly widen your buyer clients’ purchasing power.
For Sellers: The Competition Is Fierce—But Not Fatal
Here’s the twist: we’re in a buyer’s market, but not because buyers disappeared. In fact, the Cromford® Demand Index shows buyer interest is rising. What’s tipping the scale is supply. So far this year, the Arizona Regional MLS has recorded more new listings than any year since 2015. Inventory is up—and sellers are feeling the squeeze.
What does this mean for your listings? More price reductions (up 58% over last year), and stronger buyer negotiations—even on homes that are turnkey-ready. Sellers aren’t wildly overpricing like they did in 2021–2022, with list prices per square foot staying within 1% of last year across most ranges. But they are getting more realistic. In fact, homes under $1M are now closing at 98.3% of the final list price (down from 98.6% last year), translating to a typical discount of $8,500 on a $500K home. For properties over $1M, that discount jumps to an average of $46,000.
To stay competitive, sellers must be strategic—not desperate. That means staging, neutral paint colors, upgraded appliances, and general polish aren’t optional anymore. In a crowded market, a house in great condition becomes the standout.
A Glimmer of Hope: Falling Mortgage Rates
There’s one factor that could tip the scales back in sellers’ favor: falling mortgage rates. After peaking at 7.26% in January, the average 30-year fixed is now hovering around 6.78% according to Mortgage News Daily. Global economic uncertainty and stock market volatility have investors moving money into bonds, pulling down the 10-year treasury yield—and that’s great news for homebuyers.
If rates fall below 6.5%, expect buyer activity to pick up further, potentially narrowing the negotiation gap and stabilizing prices. This is where your expertise as a realtor becomes essential: keeping your clients informed, calm, and ready to move when timing is right.
The Bottom Line for Arizona Realtors
This is not a doom-and-gloom market—it’s a savvy-agent’s playground. Whether you’re working with buyers or sellers, now is the time to lean into your knowledge, set realistic expectations, and get ahead of shifting dynamics. Home values aren’t crashing—they’re coasting. Inventory is rising—but so is opportunity.
Be the Arizona real estate expert your clients trust to navigate this season with clarity, strategy, and confidence.
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.