Phoenix, Arizona Market Update: Seller Momentum Gains, But Demand Still Lags As of July 23, 2025

Phoenix, Arizona Market Update: Seller Momentum Gains, but Demand Still Lags As of July 23, 2025. The shift we started to see last week has officially gained momentum—Phoenix, Arizona, and the surrounding cities are experiencing a market shift back in favor of sellers. The Cromford Market Index (CMI) is up an average of 2.7% month-over-month, a notable jump from just 0.4% last week.

Here’s what’s driving the change:

🔺 10 cities improved for sellers, while only seven became more favorable for buyers.🔺 Paradise Valley remains a standout, thanks to extremely low inventory—only 104 single-family homes are currently for sale. That’s down from 140 this time last year and well below the long-term average of 274.🔻 Supply is tightening across many parts of the Valley, and the surge of new listings we saw earlier in 2025 appears to be tapering off.

But don’t let this trend fool you—it’s not a full-blown seller's market just yet. Buyer demand remains weak and hasn’t shown any signs of picking up. The positive movement for sellers is being driven largely by reduced competition, not an influx of motivated buyers.

📉 Cities still facing headwinds for sellers:

• Avondale (notably weaker)

• Fountain Hills

• Mesa

• Tempe

• Gilbert

• Surprise

• Maricopa

  
  

📈 Cities gaining traction for sellers:

• Cave Creek (+11%)

• Glendale

• Scottsdale

• Goodyear

Lastly, the monthly average sales price per square foot has declined sharply over the past few months—an indicator that, while the market may favor sellers in terms of competition, pricing power remains under pressure.

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Mortgage Market and Economic Update – Week Ending 07/25/2025

Let’s take a look at what happened this past week, which included a rare presidential visit to the Federal Reserve…..

The Federal Reserve will meet next week 

On July 30, the Federal Open Market Committee will meet to discuss the US economy and set interest rate policy. The market overwhelmingly expects that the Fed will keep the Federal Funds Rate target range steady at 4.25%-4.50%. In other words, no rate cut. [Sources: Federal Reserve & CME]

After starting to cut rates in late 2024, the Fed has been on “pause” for all of 2025. Why? First, because inflation (“core” PCE) has failed to make much progress this year. In January 2025, “core” PCE was rising at +2.7% year-over-year. And in June 2025? Also +2.7% YoY. The Fed’s target is +2.0% second, because the labor market has remained tight, with the latest unemployment rate reading at 4.1%.

In a rare presidential visit to the Fed, Trump toured the $2.5 billion renovation site of the Marriner Eccles building and referred to Jerome Powell as a “very good man.” Rather than the usual verbal firestorm, this meeting was unusually cordial—but it did spotlight questions over cost overruns and compliance with planning rules. Trump even floated using the cost concerns as grounds to remove Powell “for cause,” though constitutional experts note this is legally restricted.

Growing Dissent Within the Fed?

It’s rare—but possible—that two dissenting governors could vote for a rate cut at the same meeting. Governors Christopher Waller and Michelle Bowman (both Trump appointees) are pushing for easing, while the Chair stays firm. This could be the first double dissent the Fed has seen in over 30 years—a sign of rising tension around economic strategy.

Bond and Mortgage Market

Average 30-year mortgage rates were essentially unchanged this week, which was actually surprising considering the huge upward moves in the stock market AND the continued rise in global bond yields (notably Japan).

Here’s what the Fed Funds Rate futures market is currently pricing in for rate cuts. Note that the current Fed Funds Rate policy range is 4.25–4.50%.

• July 30 FOMC Meeting: 97% probability that the policy rate will remain at 4.25–4.50% (up from last week). So, no rate cut expected.

• September 17 FOMC Meeting: 61% probability that rates will be 25 bps below current (up from 59%). This implies a 25 bps rate cut at this meeting. 37% probability that rates will remain at 4.25–4.50%.

• October 29 FOMC Meeting: 31% probability that rates will be 50 bps below current (down from 35% last week). 19% probability that rates will remain at 4.25–4.50%.

Wealth Through Homeownership

Over the last five years, the average homeowner has gained $140,900 in equity.  That growth didn’t happen overnight, and it’s not too late to start building your future. If you’re still on the fence about buying, reach out to see how housing can create significant, long-term wealth for your family.

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Market in a Minute...National View

Housing Market

• The median home price reached a record high of $435,300 in June, representing a 2% increase over the same period last year. Price gains were greater at the higher end of the market.

• Existing home sales fell to a 9-month low in June. Mortgage rates and uncertainty sidelined buyers, deepening the housing market slump.

• New home sales remained weak in June, falling short of estimates. Builder incentives couldn’t overcome buyers’ resistance to higher costs.

Economy

• Jobless claims fell for a 6th week, underscoring the resilience of the labor market. Continuing claims held steady at 1.96 million.

• Consumer sentiment rose in July to its highest level since February. Inflation fears eased, though concerns about future prices lingered.

• Leading indicators suggest the U.S. economy will slow. Tariffs are expected to drive up prices and weigh more heavily in the year's 2nd half.

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East Valley Weather

Have a great week!