Phoenix Metro Update - September 2025

Payments Drop 12%, Monthly Sales Up 9.4%

As the Greater Phoenix housing market shifts, both buyers and sellers are navigating a landscape full of opportunity—and urgency. With mortgage rates dipping and the Cromford® Market Index (CMI) climbing, now is the time to understand how these changes could affect your real estate journey.

For Buyers: Take Advantage While You Can

The Cromford® Market Index has been signaling a buyer’s market since November 2024, bottoming out at 72 before turning around in mid-July. As of September 11th, it has risen to 81, showing steady movement back toward balance. If it passes 90 this fall, the year-long buyer’s market could come to a close.

That means buyers may not have as much time as they think to capitalize on today’s favorable conditions. Let’s break down why:

• Mortgage savings are real. Rates dropped from 7.26% in January to 6.27% in September. On a $350,000 loan, that’s a monthly savings of $240.
• Asking prices have softened. Mid-range listings ($300K–$600K) have decreased in price by nearly 2%, which further adds to the discount.
• Sellers are making deals. More than 60% of sales between $225K–$600K include seller-paid closing costs, often with a 2/1 buydown. This can drop first-year payments by another 20%, putting a $2,400 January payment closer to $1,690 today.

Bottom line: buyers are seeing 12% lower payments compared to January—and that’s before factoring in seller concessions. But as the CMI rises and demand strengthens, these opportunities may fade.

For Sellers: Recession Fears Could Work in Your Favor

Recession talk has dominated headlines, with UBS estimating a 93% chance of one on the horizon. But in housing, recessions often boost demand instead of stalling it. Why?

• Falling rates fuel buying power. As unemployment rises, investors flock to bonds, driving down mortgage rates. More buyers suddenly qualify, and demand strengthens.
• History repeats itself. Greater Phoenix saw sales increase during the 2001, 2008, and 2020 recessions—despite high unemployment.
• Sellers get motivated, too. Lower mortgage rates don’t just excite buyers. Many homeowners choose to list when financing becomes more attractive, which can create a temporary bump in supply.

That said, timing matters. The 4th quarter is rarely strong for sellers, with demand dipping during the holiday season. Luxury and retirement markets may also lag, as they depend more on investment portfolios than mortgage rates.

Conclusion: A Market in Motion

Whether you’re buying or selling, today’s market is packed with both opportunity and risk. Buyers should act quickly to lock in lower payments before the market balances out, while sellers should weigh timing carefully as demand strengthens but seasonal slowdowns loom.

If you’re in the Phoenix Metro area and want help navigating these shifts, reach out to Bret Johnson at 602-502-6468 or bret@renetgroup.com. Let’s make a plan 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