Still a Buyers' Market in Flagstaff

If you’ve tried to sell a Flagstaff home in the $800,000 price range this year, don’t feel too badly that your home wasn’t chosen – only one lucky winner has gone to closing in that range so far, and there are 276 months’ worth of similarly priced homes to go at that rate of sales (assuming no others come on the market before another sale).

“Absorption rate” is one indicator of market condition that real estate professionals consider in advising their clients. A six-month supply of homes is considered a “balanced market,” favoring neither buyers nor sellers because of the oversupply or undersupply of homes for sale. The rate is calculated by taking the number of homes on the market at any point in time and dividing that number by the number of homes sold in the prior month.

In Flagstaff, the absorption rate was overall about 8-months based on the June pace of sales – June was the best month for volume of Flagstaff home sales so far this year.  That’s the right trend for sellers – volume up! (But it was still a buyers’ market.) The reasons for the improvement in volume in June were lower prices and low, low interest rates. And also, the impact of the federal government’s home buyer tax credit for sales which were under contract by April 30 and closed in June.

Looking back over the first six months of Flagstaff home sales for 2010, and taking the average number of sales per month for those six months, the absorption rate picture is not so rosy. That’s partly because the winter months are usually slower months (though the tax credit kept them going this year) and partly because prices were higher at the beginning of the year than they are now. Here’s a look at the supply of Flagstaff homes for sale in various price ranges:

To begin your search for a Flagstaff home, visit use my website to search the Flagstaff MLS.

The data in this table is based on information about Flagstaff home sales in the multiple-listing-service owned by the Northern Arizona Association of Realtors^® and is deemed reliable for sales reported to the association, but does not include ALL sales in the market area (just most).