Between November 15 and December 11, the CMI was below 90, but during the last three weeks it has shown strong signs of recovery and is almost back over 100 again. This means statistical downward pressure on prices is negligible and the only reason for prices to go down after January are psychological. We are likely to see plenty of skepticism, but gradually people will realize that things are not so bad. Of course, the Federal Reserve can still kick us some more, but we will not try to predict the effect that will have on mortgage rates.

We are back in a very normal market from the point of view of the balance between buyers and sellers. We are still very far from normal in terms of volumes. We have very few buyers and very few sellers, so transaction counts are unusually weak. This will not feel good for those who depend on volume, but once confidence returns, volume will probably start to recover.

Cromford Market Index

This index measures the demand between buyers and sellers. 100 is a balanced market. Under 90 is a buyer’s market whereby buyers have more negotiating power. Over 110 is a seller’s market. For reference, in 1st and 2nd quarter of 2022, CMI was above 500 in many of the Phx area cities - historic levels of buyer demand.