McCormick Ranch Sales Update: September 2024

We are in the home stretch of the summer heat and cooler temps are finally right around the corner! And, the 110 day streak of 100+ degree days is finally over! This is one of my favorite times of the year as we can soon enjoy dinner on the patio, longer walks with our dogs, and seeing our gardens thrive.

Fall is also generally a semi-busy time of the year when it comes to real estate. Activity is much lower than the spring but there is often some revitalized demand for those that want to move before the holidays. And, many are back from summer trips (or just can't imagine moving during 110+ degree days). We're also seeing a preliminary drop in interest rates that has the potential to spark demand. Average rates have dropped from 7.79% to 6.2%. While this is a far cry from the low 3% of 2020, it is still a large improvement. We will continue to get further guidance from the Fed at their future meetings.

When looking at a market it is often best to focus on a single aspect. Real estate is incredibly local and even the city, zip code, or neighborhood can affect supply, demand, and thus prices. If we look specifically at single family homes in McCormick Ranch, we see continued appreciation and rising prices. Single family homes have hit their all time high of around $1.335M for the rolling 6 months. Buyers are willing to pay top dollar for fully renovated homes which is helping prices all around. There were two sales above $2,000,000 this past month, one of which closed at $2,960,000. Many areas of the Phoenix valley are seeing light demand but McCormick Ranch is the opposite.

Patio homes and townhomes have also seen increased prices over the prior 18 months. Townhomes are up just a few percent while patio homes have risen around 11.7% over the prior 18 months (7% on an annualized basis). Condos are essentially flat with a .8% drop.

As expected, we see a very similar view when it comes to price per square foot. Single family and townhomes have hit all time highs. They are up around 6% on an annualized basis since the start of 2023. Patio homes are just off of their highs but have also increased around 6% per year since January 2023. Condos price per square foot is up around 1% in the same time period.

McCormick Ranch started the month with 67 listings, 24 of which were single family. There were 23 sales last month, including 12 single family. So, there is still a decent amount of demand in our neighborhood. That leaves 2 months of inventory for single family homes which is a slight seller's market. That being said, this total number of sales is very tepid compared to prior years. Our 5 year average for August is 37 sales.

Looking forward, I'm still expecting our low number of sales to continue through the end of the year. We still need rates to drop further to release some supply and increase demand from buyers. All eyes will be on the Fed in the coming months to see how they respond to changes in our economy.

Yours in McCormick Ranch real estate,

Randy