May 12, 2009

Phoenix resale market median price down from April 2008

Posted: May 12, 2009

There were 9,100 resale homes recorded sold in April 2009, while there were 8,610 recorded sales in March and 6,395 sales for a year ago. Foreclosure activity in April 2009 represented 27 percent (2,460 transactions), while there were 6,640 traditional market transactions.

Foreclosure activity, as a share of total activity, is down significantly from the 51 percent (4,295 recordings) of February 2009. This slowdown can primarily be attributed to the various hiatus programs that lenders instituted, while awaiting the new loan modification and re-financing programs from the federal government, according to Jay Butler, director of Realty Studies in the Morrison School of Management and Agribusiness at Arizona State University’s Polytechnic campus.

For April 2008, there were 2,580 sales in foreclosure or 40 percent on the month’s recordings. For March 2009, foreclosure activity differed throughout the Valley such as 30 percent in El Mirage, 25 percent in Mesa and 29 percent in Glendale.

“Historically, April is part of the resale home season that usually lasts until August,” said Butler. “During this time, sales and median prices tend to increase as the buyers move to lock in a purchase before the start of schools and the holiday times. Thus, some improvement in the local housing market would not be unexpected.”

Although mortgage interest rates and prices are attractively low, tighter underwriting standards, a weak economy and poor job market (including job losses and lost income through reduce pay and furlough programs) could place sever obstacles before the potential of the market.

The impact of foreclosures on the market has been the primary concern of the last year and will continue to be in the coming months, especially with the end of many hiatus programs and the weak job market.  The fundamental mitigating factor could be the various existing and potential loan modification programs that will allow households to save their homes.

“There is increasing hope that the housing troubles are beginning to ebb and the bottom, along with recovery, is in sight,” said Butler. “However, many problems continue to exist that could hinder the timing of any recovery,” he cautions.

The declining prices have piqued interest for potential investors and owner-occupants, especially in the lower income ranges. For the traditional market, the median price in April was $125,000 or down 44 percent from the $225,000 of a year ago.

Foreclosed properties had a median price of $145,965 ($181,115 for April 2008). Investment interest is being driven by the anticipation that home prices will rise again in the next few years.

There are two fundamental reasons why the median price for foreclosed homes is higher than traditional transactions. The first reason is more expensive homes continued to be foreclosed, with 21 being over $1 million in April, four over $2 million, and 5 percent of the foreclosures were in the $400,000 to $1 million range.

The other reason is that, for the last year, approximately  33 percent of the traditional sales were foreclosed homes that were sold again with a median price markdown of 15 percent. The markdown varied throughout the Valley ranging from 50 percent in Maryvale to 20 percent in Avondale to 10 percent in Tempe. However, since the beginning of 2009, the share of foreclosed homes has increased to slightly over 55 percent of traditional sales, with a median markdown of 25 percent.

Since the Greater Phoenix area is so large, the median price can range significantly. For April 2009 in North Scottsdale, the median price for a foreclosed property was $410,420 ($465,500 in March), while the traditional market was $450,000 ($430,000 in March). In South Scottsdale the splits were $180,980 ($190,900 in March) and $211,000 ($211,000 in March), respectively.

In Maryvale, traditional transactions were $43,000 ($39,900 in March) and foreclosures were $81,735 ($84,725 in March), while in Union Hills it was $207,500 ($199,900 in March) and $182,750 ($193,555 in March), respectively.  For April 2009, Paradise Valley had a median square footage of 3,830 and a median price of $1,325,000. 

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. Rapidly declining value can be another issue in some of the mortgage modification programs which require a limited decline in value from the purchase and financing of the home.
Within the 955 total recorded sales for April 2009, the townhouse/condominium market had 270 foreclosed properties.  For a year ago, there were 870 total transactions with 200 being foreclosures. In April 2009, the median price for foreclosed properties was $112,250 while the traditional market stood at $116,500. Last year, the splits were $146,200 and $170,000, respectively.

The median square footage for a single-family home recorded sold as foreclosed in April was 1,650 square feet (1,680 for a year ago), while it was 1,715 square feet (1,830 for a year ago) for a market transaction home.

In the townhouse/condominium sector, the median square footage for a foreclosed unit was 1,070 square feet (1,095 for a year ago), while the traditional market units was 1,180 square feet (1,150 for a year ago).



April 2008-- SINGLE-FAMILY RESALE HOMES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 1,680 $173,675 840 $200,000 840 $157,645
Scottsdale 350 505,000 285 525,000 65 416,365
Chandler 375 234,950 260 240,000 115 223,040
Gilbert 405 241,970 280 240,500 125 247,315
Mesa 665 190,435 420 200,000 245 177,165
Tempe 100 245,000 80 246,750 20 238,185
Avondale 215 172,000 90 172,900 125 169,705
El Mirage 100 141,000 40 139,000 60 148,750
Glendale 440 185,000 220 204,000 220 175,000
Goodyear 185 220,000 115 229,900 70 201,820
Peoria 275 223,255 155 234,500 120 211,500
Sun City 105 159,125 90 162,750 15 144,060
Sun City West 90 217,500 85 217,500 5 249,840
Surprise 410 199,000 255 205,000 155 185,350
             
County 6,395 $205,700 3,815 $225,000 2,580 $181,115

 

March 2009 -- SINGLE-FAMILY RESALE HOMES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 2,720 $ 80,300 1,850 $ 64,000 870 $112,500
Scottsdale 345 375,000 250 385,000 95 341,250
Chandler 375 203,815 270 209,950 105 193,005
Gilbert 465 200,000 335 200,000 130 201,100
Mesa 805 132,000 545 126,000 260 147,445
Tempe 90 186,000 65 200,000 25 150,185
Avondale 330 109,900 210 106,900 120 120,000
El Mirage 205 75,000 125 71,000 80 94,085
Glendale 590 118,000 385 109,575 205 134,565
Goodyear 235 145,500 170 145,000 65 148,000
Peoria 375 173,000 260 170,000 115 195,950
Sun City 105 140,015 85 137,000 20 174,765
Sun City West 85 182,000 80 175,000 5 292,870
Surprise 535 139,900 375 135,000 160 147,325
             
County 8,610 $133,640 5,940 $127,000 2,670 $146,880

 

April 2009 -- SINGLE-FAMILY RESALE HOMES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix
2,950 $ 80,000 2,100 $ 67,000 850 $122,320
Scottsdale
405 400,000 330 405,000 75 330,500
Chandler
390 190,000 290 195,000 100 173,735
Gilbert
475 197,590 360 196,000 115 202,270
Mesa
835 135,000 630 137,500 205 134,430
Tempe
95 169,000 65 168,000 30 208,785
Avondale
345 108,000 255 105,100 90 111,800
El Mirage
205 66,000 145 65,000 60 85,325
Glendale
645 108,700 455 95,000 190 134,100
Goodyear
255 145,000 170 141,750 85 161,500
Peoria
370 168,000 255 165,900 115 175,520
Sun City
110 135,000 100 130,500 10 168,900
Sun City West
85 176,600 85 176,600    
Surprise
525 132,000 390 130,000 135 139,735
             
County 9,100 $131,715 6,640 $125,000 2,460 $145,965

 

April 2008 -- TOWNHOUSE-CONDOMINUM RESALES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 290 $146,155 200 $154,980 90 $134,260
Scottsdale 225 250,000 185 250,000 40 247,555
Chandler 35 148,500 25 165,000 10 116,515
Gilbert 10 169,465 5 179,000 5 164,110
Mesa 80 131,775 70 137,000 10 99,450
Tempe 30 172,475 25 174,950 5 140,250
Avondale            
El Mirage            
Glendale 30 108,005 15 127,500 15 79,080
Goodyear            
Peoria 20 156,000 15 120,000 5 170,050
Sun City 45 117,250 40 119,000 5 97,070
Sun City West 25 138,750 25 138,750    
Surprise 10 122,500 10 122,500    
             
County 870 $165,000 670 $170,000 200 $146,200

 

March 2009 -- TOWNHOUSE-CONDOMINUM RESALES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix 345 $ 95,490 190 $102,500 155 $ 90,630
Scottsdale 160 186,450 120 183,250 40 195,250
Chandler 30 112,000 20 102,450 10 112,000
Gilbert 15 114,025 15 114,025    
Mesa 90 97,500 70 97,500 20 99,445
Tempe 30 127,000 15 134,000 15 124,565
Avondale            
El Mirage            
Glendale 40 67,685 15 36,825 25 90,405
Goodyear            
Peoria 20 113,500 15 98,500 5 149,325
Sun City 50 84,500 50 84,500    
Sun City West 20 125,250 20 125,250    
Surprise 5 107,500 5 107,500    
             
County 900 $112,000 605 $115,000 295 $105,075

 

April 2009 -- TOWNHOUSE-CONDOMINUM RESALES
Selected Cities Total Median Price Traditional Sales Median Price Foreclosed Sales Median Price
Phoenix
350 $103,000 210 $ 98,000 140 $111,785
Scottsdale
230 171,230 180 175,000 50 162,800
Chandler
30 119,000 20 137,000 10 84,710
Gilbert
20 101,000 15 101,000 5 88,875
Mesa
85 100,000 65 103,500 20 84,700
Tempe
25 119,000 20 111,500 5 126,100
Avondale
           
El Mirage
           
Glendale
35 58,000 20 33,450 15 81,860
Goodyear
           
Peoria
15 127,025 15 127,025    
Sun City
50 94,850 50 94,850    
Sun City West
20 107,500 20 107,500    
Surprise
10 101,500 5 110,000 5 61,720
             
County 955 $115,000 685 $116,500 270 $112,250

 


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