Sedona Real Estate Market Report -The Sedona Market is Hot!
Third Quarter 2009
The defining measure of this market is not that prices are down. We know that they've been coming down for the past few years,  but that the landslide has stopped and homes are selling.  Hurray!  Sales of residential homes in 2009 grew for the third quarter in a row, already surpassing the total number of homes sold in all of 2008: 299 compared to 309. The amazing combination of low interest rates and low priced homes  cannot be beat.  

Foreclosures and Short Sales

Of the 126 Homes Sold, 21% were foreclosures and 10.4% were short sales.  While some Buyers looking to stretch their dollars found their dream home in a foreclosure or short sale, many others didn't.  Instead they  found many of these foreclosures to be in serious disrepair and not worth even the supposedly low price the banks were asking.   Short Sales on the other hand presented a different problem, one of timing.  Buyers are refusing to put their lives on hold for months waiting on the banks to give them an answer on their offer. With a little luck, patience and knowledge of the market, however, bargains can be found, just don't limit your search to just distressed properties, consider traditional sales as well.

Homes Sold

The number of homes sold continues to increase as Sellers price their homes competitively: 126 homes sold in the 3^rd quarter of 2009, up 4.1% from the 2^nd; and up 50% from the 1st quarter 2009.   Homes priced below $399,000 sold the most, followed by those priced $400,000 to $600,000, while those priced $800,000 to $999,000 saw no change. Two markets decreased: homes priced $600,000 to $799,000 decreased 31% and  the Sedona Luxury Market, homes above $1,000,000, decreased by 8%.

Average Price Per Square Foot Shows Stability

The average price per square foot went from $195  2^nd Quarter 2009 to  $194 the 3^rd quarter 2009, a decline of 1%. You should know that the low- end market, homes that sold below $250,000, have been selling the most and consequently driving prices down. This will change as inventory of homes in this price range has shrunk considerably. Price per sqft in all other price ranges rose modestly in the 3rd quarter. 

Inventory Continues to Shrink

The inventory of homes for sale in Sedona has been a key factor in the local market for the past several years. Inventory levels are generally a good indication of where home prices are going.  As of September of 2009 that level dropped to a 12 month supply, down from a 37 month supply in January of 2009. Are we going to see prices soar any time soon due to the drop in month supply?  We doubted,  but we'll probably see interest rates go up.  This may be one reason why you would want to buy now.  Low prices with low interest rates, present a great opportunity for vacation home buyers and retirees looking to settle in Sedona.  

******************************************************************************
One of the many questions buyers ask is "Has this market bottomed out?"  In order to answer this question, prices per square foot must either remain the same or go up for at least 6 months straight. Based on the average price per square foot of homes that sold in the last 6 months, it sure looks like the Sedona market has hit bottom.

Sedona home sales grow four months in a row from March to June 2009

The number of existing home sales rose for four months in a row ending in June 2009. Sales have been driven up by retirees and second home buyers taking advantage of deeply discounted homes. These homes were priced so well that we saw multiple offers and continue to do so.  Of the 152 homes that sold March through June, 32% were foreclosures or short sales, the others were homes priced well, to sell, in this exciting market.

AVERAGE PRICE.
The average price which had been dropping all along, started to climb. It rose from $397,000 in March to $466,000 in June.  Even though prices are on the rise, they're still  25 to 35%  below their high in 2006 and in some instances even lower. Click to see latest Sedona Homes Sold List, discounts have been as high as 60% below original asking price.

PENDING SALES
The number of pending sales (pending sales are contracts that are waiting to close) is gowing at a rapid pace. As of July 23 there were 88 pending sales.  Many  of these contracts are for short sales which clog  up the process. On an  average, contracts close between 45 to 60 days from their initiation, short sales take anywhere from two to six months. Many have finally closed as seen by the increase in actual closing (sales).

INVENTORY GOING DOWNWARD.
More good news.  While sales are rising, inventory is shrinking. On june 30th we had 533 active listings, and an absorption rate of 11.8 months . (The Absorption Rate is a measure that's used to gauge the market). This means that it would take up to 11.8 months to clear up inventory.  Compare this with June 2008 where we had 661 active listings and an absorption rate of  22.7 months. The acceptable  Average Absorption Rate is 5 to 6 months, while the desired is what we had at the height of the Sedona market in 2006 -  3 months. The Good news is we're heading in the right direction.

By the activity we're currently seeing, we expect the third quarter to be even better, as more buyers who are in a position to buy, become aware of  this unbelievable Buyers' market  . 

SEDONA MARKET - 1st Quarter 2009 Vs 2nd Quarter 2009
When quarters are compared back to back, the 2nd quarter did outstanding. The number of homes sold increased by 89%, median price up 3% and days on the market down 7%. Average sold price and price per square foot decreased, but at a much slower pace. See table below.

This enchanting hilltop home/ranch situated on a five-acre parcel backs up to the National Forest and offers panoramic views of Mingus Mountain and the Sedona skyline.  The Western Spirit Ranch is a dream home for horse and nature lovers and a retreat for those looking for privacy and solitude. Easy access to covered deck and courtyard with hot tub and water feature. Built by distinguished builder, Steve Biasini, for his own personal residence.  His attention to detail and use of natural materials is apparent throughout the home.  Features include: natural wood ceilings with large wood beams, rustic brick floors, brick walls, arched hallways, oversized windows, glass panels and skylights. The open floor plan includes living room with a built-in wood/brick bench, dining area, huge center hall and a wood-burning stove. The country kitchen with Center Island and separate dining area is warm and inviting. The bedrooms are all master suites with full baths and walk-in closets.

How are homes selling in Sedona?  Although we're seeing some price stability, prices are still being driven downward due to continued high inventory.  The average price per square foot of all homes sold January through August 2008 was $254; 11% less than the $285 average price per SqFt in the same period in 2007. Price per square foot in 2006 for this period was $303 or 16% higher than today. Remember this is the average; some homes have sold for the asking price while others sold for as low as 30% below the asking price depending on the circumstances and seller's motivation.

In this same period, the average home in Sedona consisting of 2034sqft, 3 bedrooms, 2 baths on a quarter acre +/- sold for $539,238. 

The Sedona luxury Home Market, homes priced over $1,000,000, is showing some stability. The average price of luxury homes sold during January thru August 2008 went from $1,503,000 in 2007 to $1,535,000 in 2008, resulting in a 5% price increase. When prices are compared to the same period in 2006, prices in 2008 were less by 11%.- so buyers are still doing well.

For some, it is a great time to buy! Call John Limotte at 928-300-0849 if you would like specific information about properties in your particular price range and area.  John knows the Sedona market well and is a skilled negotiator who can find you the right home at the right price.