Mortgage rates hit 7.28% on October 1. That's the highest since November 2023, and a year ago the same rate was 6.34%. It was 6.71% on September 3.
Higher rates hurt buyer demand. That part is obvious. What's less obvious is where it hurt. I pulled the Cromford Market Index for every large Phoenix-area city, single family detached homes only, comparing October 6 to September 6. No condos, no mobile homes, and nothing older than 30 days.
A quick refresher on the index. Cromford's Market Index is a short-term forecast of how balanced the market is. It's built from the trends in pending, active and sold listings, compared with the previous four years. Above 100 favors sellers, below 100 favors buyers, and 100 is balanced. The math behind it is demand divided by supply, so a city can fall by cutting demand, by adding supply, or both.
Every city dropped. Not one went up.
The biggest drops:
- Tempe: 87.0 to 68.4 (down 18.6)
- Mesa: 116.7 to 99.5 (down 17.2)
- Chandler: 137.3 to 120.6 (down 16.7)
- Glendale: 111.0 to 97.9 (down 13.1)
- Phoenix: 114.7 to 102.4 (down 12.3)
- Surprise: 74.2 to 62.3 (down 11.9)
- Gilbert: 109.2 to 98.8 (down 10.4)
Three cities crossed from seller's market to buyer's market in 30 days: Mesa, Gilbert and Glendale. Phoenix (102.4) and Avondale (101.9) are still above 100, but barely.
The East Valley took the hardest hit. Tempe, Mesa, Chandler and Gilbert all fell 10 points or more. Chandler is the only one of the four still clearly favoring sellers, at 120.6, and it lost 16.7 points to get there. In Phoenix, sales per month fell from 777 to 706 while active listings (not counting homes already under contract) rose from 2,583 to 2,811. Fewer buyers, more homes.
Who held up? Scottsdale fell 7.7 points but is still at 149.4, the strongest in the valley by a wide margin. It's also one of only two cities where demand went up (80.5 to 82.4). Buckeye barely moved (50.9 to 49.7), and demand rose there too (95.2 to 96.8). That isn't strength. Buckeye already sat deep in buyer's market territory, with a supply index near 195. The far-out growth towns (Maricopa, Queen Creek, San Tan Valley) fell the least in points, mostly because they were already low. All three are below 55.
Nothing here says prices are about to fall. The index measures leverage, not price. What to watch is seller motivation. Most owners can wait out a slow market. A few can't: a job change, a home already bought, two payments at once. When a handful of those sellers accept less, the sold prices in that neighborhood move, and nearby listings get priced against them. That happens block by block, not city-wide.
If rates stay near 7%, Phoenix and Avondale are the next to cross into buyer's market. Seasonal slowing adds to it. Freddie Mac posts the next rate reading Thursday.
Pick your situation
Where a city sits on the index changes what a buyer or seller should do before the end of the year. I'm putting together a plan for each of these. Comment or message me your city and situation and I'll send it to you later this week.
Under 80 (Maricopa, Queen Creek, Buckeye, San Tan Valley, Surprise, Tempe, Goodyear)
- Buying before year-end
- Selling before year-end
80 to 110 (Peoria, Avondale, Glendale, Mesa, Gilbert, Phoenix)
- Buying before year-end
- Selling before year-end
Over 110 (Chandler, Scottsdale)
- Buying before year-end
- Selling before year-end
Which situation are you in?
