Metro Phoenix Housing Market Update

February 2026

As of March 5th, 2026, mortgage interest rates are sitting near three-year lows, and that’s beginning to have a noticeable impact on the Phoenix housing market.

For example, I’m currently working with a client using a VA loan at 5.75%, and through our Bundle & Save program, they have the option to either buy their rate down to 5.5% or apply the credit toward closing costs. Lower borrowing costs like this are helping many buyers re-enter the market.

And the data reflects that renewed activity.

Between January 1st and March 1st, the number of homes under contract in Metro Phoenix increased by more than 2,000 properties, showing that demand has started to strengthen as financing becomes more attractive.

However, while this is encouraging news for the market, there are still some important underlying fundamentals that both buyers and sellers should understand.

Inventory Remains Elevated

The inventory of single-family detached homes listed on the MLS in Maricopa County is currently about 65% higher than what we would typically consider a normal market level.

This higher supply has created a more competitive environment for sellers. As a result, we are seeing significantly more price reductions than usual, particularly among homes that entered the market aggressively priced.

For homeowners who are serious about selling — not simply testing the market — pricing strategy and presentation are more important than ever.

Average Price vs Median Price

One of the more interesting trends in the current market is the difference between average sale price and median sale price.

Over the past 12 months:

• The average sale price has increased

• The median sale price has actually declined

What this tells us is that the luxury home segment is performing exceptionally well in Arizona, pushing the average price higher, while the broader middle portion of the market is experiencing more price pressure.

This divergence is an important signal because it shows two different markets operating at the same time.

Homes Are Still Taking Time to Sell

The average number of days it takes to sell a home in Metro Phoenix is currently 83 days.

While that is still relatively high compared to long-term averages, it’s an improvement from January’s decade high of 96 days, suggesting that market activity is gradually improving as we move into the spring buying season.

What This Means for Buyers and Sellers

For buyers:
Lower interest rates and higher inventory are creating more options and negotiating leverage than we’ve seen in recent years.

For sellers:
Homes are still selling, but success increasingly depends on accurate pricing, strong marketing, and proper preparation before listing.

The Phoenix housing market is currently in a transition phase — stronger demand is returning, but elevated inventory is keeping pricing competitive.

If you’d like to know what these trends mean for your specific home or neighborhood, feel free to reach out.

Michael Hankerson
Designated Broker
Hankerson Team | Luxury Division

602.770.7205