More Homes Under $400K? Here's What's Happening in the Phoenix Housing Market

Thinking about buying or selling a home? The Greater Phoenix housing market has some interesting changes this fall, and they could affect your plans. Let's talk about what's happening!

There are more homes priced under $400,000 available for buyers to explore, but fewer homes are actually selling. So, does this mean buyers have an advantage? And what should sellers know before putting their homes on the market?

Let's break it down!

More Homes to Choose From Under $400K

Good news for home shoppers! There are more single-family homes priced under $400,000 available across Greater Phoenix than there were just a few weeks ago.

According to The Cromford Report, the number of homes for sale in this price range has grown by 25% since early September.

And there's more. So far in 2026, 17,077 single-family homes under $400,000 have been listed for sale, which is 14.4% higher than during the same period in 2023.

What does this mean for you? If you've been searching for a home without wanting to stretch your budget too far, you may have more options to explore. The report also found that a $400,000 budget gets buyers a median home size of about 1,548 square feet. That's roughly 100 square feet more than in 2022. Of course, home prices and sizes vary depending on the neighborhood, so it's always worth looking at what's available in the areas you love.

Are Home Prices Going Up or Down?

Here's where things get interesting! The average price per square foot has decreased in several lower price ranges, while some higher-priced categories have seen increases. For example, homes priced under $300,000 saw a 5.7% drop in average price per square foot compared with October 1–18 last year. Meanwhile, homes priced at $3 million and above saw a 26.5% increase.

What does that mean for you? The market isn't moving the same way at every price point. Some buyers may find more opportunities in certain price ranges, while sellers need to pay attention to what similar homes are selling for. Real estate is local, and even within Greater Phoenix, your price range can make a big difference!

Should You Wait for Mortgage Rates to Drop?

Ah, the big question! Should you buy now or wait for mortgage rates to come down? The Cromford Report put the average mortgage rate at 7.4% as of October 21, 2026. While rates may change, no one can predict exactly where they'll go next.

Here's something important to remember: your monthly payment depends on more than just your interest rate. The price of the home you buy matters, too. For example, if mortgage rates rise, a lower home price may help offset some of the increase in your payment. On the other hand, waiting for rates to drop doesn't guarantee you'll find the same home at the same price later. And if rates eventually fall after you buy, refinancing could be an option, depending on your financial situation and the terms available at that time.

The bottom line? Don't base your entire decision on trying to guess what mortgage rates will do next. Consider your budget, your monthly payment, and whether a home fits your needs.

What If You're Planning to Sell?

Don't let the headlines scare you! Home prices across Greater Phoenix are holding steady compared with last year, even though fewer homes are selling. The median sale price over the past month was $450,000, unchanged from the same period last year.

However, buyers are taking their time. Homes that went under contract spent a median of 50 days on the market. That's the time between a home being listed for sale and the seller accepting an offer. Meanwhile, completed home sales fell 9.8% compared with the same period last year.

What's the takeaway for sellers?

You may need a little more patience, and pricing your home correctly from the start is especially important. Buyers have more homes to compare, so a home that's priced in line with similar properties may have a better chance of attracting serious interest.

If you're hoping to sell before the holidays, now is a good time to talk through your pricing, preparation, and timing.

A Different Story for Luxury Homes

Interestingly, not every part of the market is slowing down. In September, sales of homes priced above $1.5 million increased by 25% compared with September last year. Sales of homes above $3 million also increased, from 57 to 62. It's a good reminder that what's happening in one price range may look very different in another. The market for a first home isn't necessarily the same as the market for a luxury property.

So, What Does This Mean for You?

Here's the quick recap:

• For buyers: More homes under $400,000 are available, giving you more options to explore.
• For sellers: Home prices are holding steady overall, but fewer sales mean pricing and preparation matter.
• For everyone: The best decision depends on your budget, your goals, and what's happening in your particular neighborhood.

Real estate can feel complicated, especially when the headlines keep changing. But you don't have to figure it all out on your own.

Whether you're thinking about buying your first home, finding a little more space, or selling before the holidays, I'm happy to help you understand your options.

Have questions about the market in your neighborhood? Let's chat! 

Source: The Cromford Report, commentary by Tina Tamboer, Senior Housing Analyst. Market figures reflect the reporting periods stated in the October 2026 commentary.