September 12, 2008

Numbers show increase in foreclosure activity

Posted: September 12, 2008

In August 2008, there were a total of 7,505 recorded resale home transactions. Foreclosure activity represented 44 percent (3,295 transactions), while there were 4,210 traditional market transactions. Foreclosed transactions represent home owners losing their property to successful individual bidders or the lender of record. In July 2008, the spilt was 3,470 foreclosed homes and 4,695 traditional transactions, while August 2007 was 915 and 3,660 recorded sales, respectively.

July typically represents the end of the resale home season, so it is not unusual to find a lower level of sales activity in August. Historically, the remaining months of the year tend to post slowing recorded activity. The 2008 year-to-date total is 29,965 traditional sales and 21,355 foreclosures.

“Foreclosure activity differs throughout the Valley,” said Jay Butler, director of Realty Studies in the Morrison School of Management and Agribusiness at Arizona State University Polytechnic campus. “For example, it was 56 percent in Avondale, 23 percent in Tempe and 41 percent in Mesa. The declining prices have fueled renewed investor interest and potential owner-occupants, especially in the lower-income ranges.”

For the traditional market, the median price was $193,550, while the foreclosed properties had a median price of $161,875. For a year ago, the median prices were $258,000 and $220,010, respectively. Investment interest is being driven by the anticipation that home prices will rise again in the next few years. The lower median price is being impacted by several forces including the large number of vacant homes, especially in certain neighborhoods. Further, capital is available for lower-priced housing, but lacking in the higher priced housing market.

Since the greater Phoenix area is so large, the median price can range significantly. In North Scottsdale, the median price for a foreclosed property was $545,000, while the traditional market was $525,000. In South Scottsdale the splits were $219,855 and $242,000, respectively. In Maryvale, traditional transactions were $98,000 and foreclosures were $123,580, while in Union Hills it was $250,000 and $186,790.

While lower prices can greatly improve affordability, they can adversely impact many owners and potential sellers whom are watching their limited equity erode, as prices decline to and even below existing debt level. Thus, lower prices affect the ability and desire to continue owning the home and even overall confidence in the economy, which puts additional strain on the local housing market.

“There is heightening expectation that the recent takeover of the Federal National Mortgage Assoc. and the Federal Home Loan Mortgage Corp. by the federal government will bring much needed confidence and stability to the housing and financial markets,” said Butler. “One expected result of the takeover is that mortgage interest rates will move lower providing some incentive for potential buyers. However, most potential buyers still confront a weak economy, slumping levels of confidence and tighter underwriting guidelines. Thus, the local housing market still contains considerable uncertainty over when any potential strengthening can be expected,” he said.

Within the 815 total recorded sales, the townhouse/condominium market had 265 foreclosed properties. A year ago the split was 945 for traditional sales and 75 for foreclosed sales. In August 2008, the median price for foreclosed properties was $125,330 while the traditional market stood at $157,000. For July 2008, the respective splits were $125,800 and $160,000.

The median square footage for a single-family home recorded sold as foreclosed was 1,640 and 1,825 square feet for a market transaction home. In Paradise Valley, the median square footage was 3,420 square feet at a median price of $1,225,000. For a year ago, the foreclosed market was at 1,725 square feet and the traditional market stood at 1,735 square feet. In the townhouse/condominium sector, the median square footage for a foreclosed unit was 1,090 square feet (1,130 square feet for a year ago), while the traditional market unit was 1,155 square feet (1,065 square feet for a year ago).

 

August 2007 -- SINGLE-FAMILY RESALE HOMES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 1,280 $215,000 1,005 $223,500 275 $187,475
Scottsdale 360 542,500 325 560,000 35 462,000
Chandler 305 282,000 270 290,000 35 224,000
Gilbert 325 297,205 255 305,000 70 265,615
Mesa 480 230,000 400 237,250 80 205,495
Tempe 115 265,000 110 265,000 5 284,310
Avondale 110 220,000 65 220,000 45 219,900
El Mirage 75 181,400 40 185,000 35 179,550
Glendale 320 239,700 250 239,950 70 237,390
Goodyear 95 257,000 70 270,000 25 210,380
Peoria 220 255,000 185 256,500 35 224,385
Sun City 75 165,000 70 165,000 5 186,250
Sun City West 60 228,000 60 222,000    
Surprise 225 232,000 160 236,170 65 225,900
             
County 4,575 $250,000 3,660 $258,000 915 $220,010

 

July 2008 -- SINGLE-FAMILY RESALE HOMES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix
2,480
$147,475
1,145
$167,000
1,335
$134,670
Scottsdale
385
450,000
300
455,000
85
446,775
Chandler
440
229,500
320
239,750
120
198,405
Gilbert
515
239,620
345
240,000
170
231,000
Mesa
800
171,925
485
179,000
315
160,000
Tempe
115
240,000
100
248,500
15
213,560
Avondale
310
159,000
145
155,000
165
160,000
El Mirage
175
124,900
70
124,900
105
125,000
Glendale
570
170,000
315
182,700
255
155,235
Goodyear
225
182,900
135
189,000
90
180,435
Peoria
355
211,000
215
221,150
140
192,960
Sun City
85
155,000
75
155,500
10
153,940
Sun City West
45
205,000
45
205,000
   
Surprise
475
173,620
280
175,000
195
165,750
             
County
8,165
$181,000
4,695
$200,750
3,470
$159,200

 

August 2008 -- SINGLE-FAMILY RESALE HOMES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 2,260 $145,000 1,075 $156,000 1,185 $135,490
Scottsdale 345 442,000 270 447,500 75 407,925
Chandler 415 230,000 295 240,000 120 204,020
Gilbert 470 228,000 295 232,900 175 213,635
Mesa 680 169,860 400 183,000 280 155,000
Tempe 110 212,500 85 230,000 25 172,975
Avondale 275 158,300 120 157,000 155 159,815
El Mirage 170 116,000 80 119,000 90 114,495
Glendale 520 170,000 270 182,000 250 153,225
Goodyear 215 181,735 125 179,500 90 187,705
Peoria 350 205,000 215 210,000 135 197,460
Sun City 65 157,000 50 145,000 15 188,490
Sun City West 35 184,635 30 194,000 5 174,030
Surprise 455 170,000 255 165,000 200 177,585
             
County 7,505 $178,000 4,210 $193,550 3,295 $161,875

 

August 2007 -- TOWNHOUSE-CONDOMINUM RESALES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 380 $178,835 345 $183,000 35 $126,575
Scottsdale 225 238,000 210 237,100 15 267,750
Chandler 35 158,150 30 158,575 5 140,000
Gilbert 10 168,945 10 168,945    
Mesa 85 145,500 75 147,150 10 126,290
Tempe 70 187,500 70 187,500    
Avondale            
El Mirage            
Glendale 60 141,000 55 149,000 5 106,640
Goodyear            
Peoria 20 163,750 20 163,750    
Sun City 40 125,000 40 125,000    
Sun City West 10 133,000 10 133,000    
Surprise            
             
County 1,020 $182,500 945 $185,000 75 $141,595

 

July 2008 -- TOWNHOUSE-CONDOMINUM RESALES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix
305
$138,600
175
$150,000
130
$120,700
Scottsdale
190
230,000
160
229,000
30
249,475
Chandler
45
142,950
30
155,000
15
125,000
Gilbert
15
158,250
10
164,750
5
128,290
Mesa
105
127,500
70
131,500
35
102,815
Tempe
55
153,000
45
155,000
10
122,240
Avondale
           
El Mirage
           
Glendale
35
108,550
15
114,900
20
101,000
Goodyear
           
Peoria
15
112,500
5
114,070
10
112,500
Sun City
40
109,000
35
109,450
5
86,250
Sun City West
10
124,000
10
124,000
   
Surprise
           
             
County
870
$147,200
590
$160,000
280
$125,800

 

August 2008 -- TOWNHOUSE-CONDOMINUM RESALES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 280 $129,840 160 $150,000 120 $108,500
Scottsdale 180 217,000 140 210,000 40 229,355
Chandler 35 145,700 25 145,700 10 148,515
Gilbert 15 162,750 5 209,750 10 135,000
Mesa 110 115,370 75 120,000 35 113,350
Tempe 55 160,000 45 160,000 10 134,065
Avondale            
El Mirage            
Glendale 35 101,950 20 106,950 15 90,495
Goodyear            
Peoria 10 175,000 10 175,000    
Sun City 35 108,000 30 115,000 5 91,915
Sun City West 10 122,320 10 122,320    
Surprise            
             
County 815 $146,820 550 $157,000 265 $125,330

 


Realty Studies is associated with the Morrison School of Management and Agribusiness at Arizona State University’s Polytechnic campus. Realty Studies collects and analyzes data concerning real estate in the greater Phoenix metropolitan area. Realty Studies is a comprehensive and objective source of real estate information for private, public and governmental agencies. Its director, Dr. Jay Q. Butler, may be reached at (480) 727-1300 or e-mail him at Jay.Butler@asu.edu. To subscribe to RSS feed for Realty Studies news, visit http://www.poly.asu.edu/realty/rss.html.

Jay Butler, Jay.Butler@asu.edu
(480) 727-1300

Chris Lambrakis, lambrakis@asu.edu
(480) 727-1173
Public Affairs at ASU Polytechnic campus