by Calculated Risk on 5/07/2014 11:17:00 AM

This is a key distressed market to follow since Phoenix saw a large bubble / bust followed by strong investor buying.

The Arizona Regional Multiple Listing Service (ARMLS) reports (table below):

1) Overall sales in April were down 12% year-over-year and at the lowest level since April 2008.

2) Cash Sales (frequently investors) were down 33%, so investor buying appears to be declining. Non-cash sales were up year-over-year.

3) Active inventory is now increasing rapidly and is up 49% year-over-year - and at the highest level since 2011.

Inventory has clearly bottomed in Phoenix (A major theme for housing last year).   And more inventory (a theme this year) - and less investor buying - suggests price increases should slow sharply in 2014.

According to Case-Shiller, Phoenix house prices bottomed in August 2011 (mostly flat for all of 2011), and then increased 23% in 2012, and another 15% in 2013.  Those large increases were probably due to investor buying, low inventory and some bounce back from the steep price declines in 2007 through 2010.  Now, with more inventory, price increases should flatten out in 2014.

We only have Case-Shiller through February, but the Zillow index shows Phoenix prices down slightly in March (most recent data), and down 1.2% in Q1.

April Residential Sales and Inventory, Greater Phoenix Area, ARMLS
	Sales	Cash	Percent Cash	Inventory	YoY Change
Apr-08	4,8751	986	20.2%	55,7261	---
Apr-09	8,564	3,464	40.4%	44,165	-20.7%
Apr-10	9,261	3,641	39.3%	41,756	-5.5%
Apr-11	9,328	4,489	48.1%	34,515	-17.3%
Apr-12	8,438	4,013	47.6%	21,125	-38.8%
Apr-13	8,744	3,670	42.0%	20,083	-4.9%
Apr-14	7,656	2,469	32.2%	29,889	48.8%
1 April 2008 does not include manufactured homes, ~100 more