Arizona Real Estate Market Update – Trends & Insights (March 2025)

As we move through March 2025, the Arizona real estate market continues to show resilience and strength. According to the latest Cromford Report (Cromford Associates LLC, 2025), average sales prices per square foot have exceeded forecasts, reflecting a robust market despite earlier predictions of a slight decline.

Current Market Snapshot

For the monthly period ending March 15, the average sales price per square foot (PPSF) across all property types in the Arizona Regional Multiple Listing Service (ARMLS) database is $314.40. This figure represents a 0.7% increase from the $312.16 recorded on February 15. Notably, this upward movement defied expert predictions, which had forecasted a dip to $304.87 (Arizona Regional Multiple Listing Service, 2025).

Interestingly, the luxury sector continues to drive this upward trend. Closing volumes in higher-priced markets have remained strong, while the more affordable sectors have shown relative weakness. This divergence reflects ongoing demand for premium properties, contributing to the increase in the overall market average.

Forecasting the Next 30 Days

Looking ahead to mid-April, the Cromford Report projects a slight decrease in average PPSF to $313.01, a modest 0.4% decline. The forecast includes a 90% confidence interval ranging between $306.75 and $319.27 (Cromford Associates LLC, 2025).

Pending sales data offers further insights. As of March 15, the average list price per square foot for pending listings stands at $334.28, unchanged from the previous month. This suggests that while closing prices may remain stable in the short term, a longer-term softening could be on the horizon.

Why Active Listings Matter

A critical indicator to watch is the average PPSF for active listings. Typically, this metric serves as a leading indicator for future closing prices. Surprisingly, the active listing price per square foot is showing signs of weakness—a rare occurrence during the spring market season. This softening suggests that the current price strength may not be sustainable over the coming months.

Moreover, foreclosure activity remains low by historical standards, with normal listings accounting for 98.7% of all pending sales. REO (Real Estate Owned) properties and pre-foreclosures comprise just 0.4% and 0.9%, respectively, reflecting ongoing stability in distressed property activity (Arizona Regional Multiple Listing Service, 2025).

What This Means for Buyers and Sellers

For Buyers:

With active listing prices softening, there may be opportunities for negotiation in the coming months. However, current demand—particularly in the luxury sector—remains strong, keeping prices elevated.

For Sellers:

While prices have outperformed forecasts, the market shows early signs of slowing. Sellers should consider listing soon to take advantage of current price strength before potential declines later in the year.

Conclusion: A Market at a Crossroads

The Arizona real estate market remains robust as of March 2025, defying earlier forecasts with stronger-than-expected price performance. However, subtle signs of weakness in active listing prices suggest that this strength may not last indefinitely.

For those navigating the Arizona real estate market—whether buying, selling, or investing—it is crucial to stay informed and adapt to evolving conditions. As the market continues to shift, having access to reliable data and working with experienced professionals will be key to making the most of current opportunities.