In an era of unprecedented market gyrations, 2022 takes the cake. A wild, exuberant market in the early spring and a largely dormant one in the fall. At the end of the 1st Quarter, the Sedona Area set the All-Time High Median Recorded Sales Price: $1,150,000 for Single-Family Residences. At Mid-Year with the market clearly well past its peak and decelerating sharply, that had slipped to $1,120,00. By the end of December, the MRSP for the year was $1,050,000.
But, if we compare the second half of the year with the first half, the difference is even more pronounced. The Fall MSRP dropped 12 percent to $987,500 and the number of single-family residence sales plunged 38 percent (263 to 162). In the spring, homes were selling, on average, for 102 percent of their list prices. In the fall, 96 percent – and taking an extra month to sell.
Another telling point of comparison is Fall 2022 versus Fall 2021. Between those two six month periods, the number of sales dropped 48 percent (309 to 162) while the MRSP rose 10 percent from $900,000 to $987,500. So, even in the face of a substantial market correction in the second half of 2022, prices manage to stay significantly ahead of the previous year.
Decline in SFR Sales Spring 2022 vs Fall 2022
MRSP for the year end 2022
Lest we get too caught up in comparisons between the more-fevered Pandemic Years, it may be instructive to go back to 2019 for a peek at what a more “normal” market looked like. That year, there were 498 single-family residence sales with MSRP of $565,000 for the year (263 sales & MRSP of $575,000 for the fall). Although sales numbers were off that by 15 percent (425) in 2022, the MRSP advanced by an astounding 75 percent over the past three years – even using the lower Fall MRSP of $987,500. That’s an average of 25 percent a year. Hardly sustainable and begging for a correction.
All of these figures are for the Greater Sedona Area – that comprises Oak Creek Canyon, The City of Sedona, & Outlying Areas West of the City Limits (all Zip Code 86336) and the Village of Oak Creek (Zip 86351).
SFR – Vacant Land – Condo Markets
If we break down the single-family sales between the two zip codes, we find that 86336 or “The City of Sedona” had 64 percent of them while 86351 had 36 percent. That’s fair enough since that roughly follows the population distribution of the two. Beyond that, though, we also find, in 2022, a 23 percent difference in the average selling price per square foot; The Village of Oak Creek. generally being the more affordable location. Furthermore, “The City” had three times the number of homes of over a million than “The Village.”
Vacant Land in 2022 followed a pattern somewhat similar to Single-Family Residences: a sharp decline in sales numbers from 2021, but an average MRSP increase of 21 percent for each of the last three years but a dramatic decline in the second half of the year. Sales dropped 39 percent (123 to 48) from spring to fall and the price declined 17.5 percent ($315,000 to $260,000).
Leave it to the Condo/Town Sector to be a bit of a contrarian, as it is wont to do. Yes, sales numbers were down from 2021, but only 13 percent, while the prices surged 30 percent. But, instead of crashing in the second half of the year sales, declined 7.6 percent and the MRSP increased 8.5 percent.
Dr. Lawrence Yun, National Association of Realtors, Chief Economist –
For 2023: Sales down 7 percent
MSRP: Up 1 percent
For 2024: Sales Up 10 percent
MSRP: Up 5 percent
Valuations for 2023
86336: Up 1.7 percent (29 Dec 22)
86351: Up 1.3 percent (7 Jan 23)
Market Action Index – January 2023
Below 30 = Buyers’ Market