Phoenix Metro Update - June 2025

For Sellers: Fewer Sales, But Brighter Prospects Ahead

Sales dipped in May compared to last year, but this appears to be a temporary pullback caused by April’s market disruptions. Unexpected tariff announcements spooked markets and mortgage rates, resulting in reduced buyer activity for several weeks. But by late April, buyers regained confidence—just a bit too late to impact May’s closing numbers.

Consumer sentiment rebounded strongly in May, with optimism particularly evident in areas of job conditions and income. Reflecting this, the purchase mortgage applications index jumped 18% over the same period last year, reaching its highest level in two years. This is an encouraging sign for summer contracts and sales volume.

The luxury market also delivered a surprise: accepted contracts over $1 million jumped 30% over a four-week span, thanks to a recovery in crypto, stock portfolios, and Q1 corporate profits. This bucks the usual seasonal slowdown seen when temperatures climb past 100°F.

Supply Shrinks as Sellers Hit Pause

While the total supply remains 45% higher than a year ago, active listings have declined by 3.4% over the past seven weeks. New MLS listings are down 39% in the past two months, marking the second-lowest level in history (only 2023 had fewer).

Sellers are increasingly opting out of the market:

• Listing cancellations are up 38% year-over-year
• Expired listings rose 84% in the last week of May
• Many are choosing to rent instead of relisting

This shift is even more pronounced in the luxury segment, where June marks the seasonal peak for cancellations. Ironically, active listings may fall more than buyer activity over the summer, creating rare opportunities for sellers. If you’re thinking of selling a luxury home, listing after June might be strategic—you’ll face less competition and gather meaningful buyer feedback before the busier fall market begins.

Conclusion: A Shifting Landscape with New Opportunity

Affordability is improving, but not because of a dramatic drop in mortgage rates—instead, it’s rising wages, slowing inflation, and flat or declining home prices creating new openings for buyers.

For sellers, recent volatility may have slowed momentum, but buyer confidence is back on the rise—especially in affordable and luxury price points. With supply tightening again, especially in desirable ranges, June and July could bring a welcome bump in activity.

Need help navigating this shifting market? Whether you’re planning to buy, sell, or just explore your options, I’m here to help. Reach out to me, Bret Johnson, at 602-502-6468 or email me at bret@renetgroup.com for expert guidance tailored to your goals.

Reference:

Commentary written by Tina Tamboer, Senior Housing Analyst with The Cromford Report
©2025 Cromford Associates LLC and Tamboer Consulting LLC