October 25, 2023

Vegas and Phoenix Cross Market Insights Report - October 2023

October 25, 2023
Vegas and Phoenix Cross Market Insights Report - October 2023

We recently release our SFR Vegas and Phoenix Cross Market Insights Report for October 2023. Here is an outline of the findings:

  • Absorption rates have seen significant declines from their peaks in late 2022 and early 2023. Currently, the absorption rates stand at 3.09 months in Vegas and 2.87 months in Phoenix
  • While both markets’ average purchase price hit a trough in Q1, Vegas has experienced a rebound. Phoenix, by contrast, has seen recent price declines
  • After reaching a low in Q4 2022, the sale-to-original-list pricing in both Vegas and Phoenix has rebounded to 98%
  • Average list prices and sale prices p.s.f have converged in both both markets. In Vegas, this convergence is attributed to rising average sale prices p.s.f., whereas in Phoenix, it's because of a decline in average list prices per square ft
  • Amid rising mortgage rates, these two MSAs continue to rank among some of the least affordable in the nation

After remaining relatively flat from April to July, active listings have risen at a steady rate for the past two months. Closings and new listings dropped last month after remaining flat for the three months prior.

After rising in August, active listings in Phoenix dropped last month and are now down 24% YTD. Closings and new listings dropped in September, but both overall have seen YTD gains.

Absorption rate comparison

Vegas Average Purchase Price - Since February, average purchase prices have grown steadily. If purchase prices increase at the current rate, they would surpass the peak ($483k) around Q2 2024.

Since May, both list price and purchase price p.s.f. have increased at a similar rate and compressed slightly.

Phoenix Average Purchase Price - After seeing major gains from March to July, average purchase prices in Phoenix decreased over the past two months. Year-to-date, prices have increased by just 1.9%. Current pricing in Phoenix mirrors levels last seen in November 2022.

After list and purchase p.s.f. rose in July and August, both fell in September. Current list prices and purchase prices p.s.f. remain around Q1 2022 levels.

After hitting a trough in December of 2022, STOLS have converged to 98% in both markets.

The affordability gap is especially high in Las Vegas, where average pricing remains 67% higher than affordable levels.

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