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Real Estate in Phoenix - The market is turning - Believe it or not

Over the last several months, statistics are showing that home sales are increasing, the home inventory is decreasing, and home values are stabilizing for Real Estate in Phoenix.

Home sales in Phoenix so far this year, January through April, have totaled 23,766, and for that same period in 2008, the total homes sold were 14,569 (a 39% increase). The sales in Phoenix for April alone were 7,681 - the highest monthly sales we have seen since September of 2005 (Remember, the good ol' days)!

Since May of 2008, the inventory of homes has dropped from 50,483 to 35,063 this April (a drop of 30% in 1 year).

The average sales price of Real Estate in Phoenix also had it's first monthly increase since March of 2008.

All three of these things are signs that the real estate market, at least here in Phoenix, Arizona, is taking a turn for the better. Hopefully there will be fewer short sales, foreclosures, and bank owned properties cropping up in the future. I feel that the affordability of housing, along with the first time homebuyer credit, are contributing to the turnaround in perception of the housing market.

See some of our current listings of Chandler Arizona Real Estate, Gilbert AZ Homes for sale, and Queen Creek Homes for sale.

Let me hear how things are going in your area, and if you are showing signs of recovery.

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This representation is based in whole or in part on the data supplied by Arizona Regional Multiple Listing Service. Copyright ARMLS 2009. ARMLS does not guarantee nor is in any way responsible for its accuracy. Data maintained by ARMLS may not reflect all real estate activity in the market.

Troy and Mia Erickson

Terra Solis Realty, LLC
Chandler, AZ - Chandler Chamber of Commerce Member
602-295-6807 troyandmia@terrasolisrealty.com Chandler AZ MLS Listings
for info about Chandler AZ homes

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Posted by Troy Erickson - Your Chandler, Gilbert, Queen Creek Realtor on 05/28/2009 06:09 PM

Comments (33)

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33 Comments on Real Estate in Phoenix - The market is turning - Believe it or not

MAY

2009

GOOD MORNING TROY! Tucson is on the same track - when I checked the daily "solds" per day - it's doubled over the last few months! -- Gabrielle

I have often wondered how to get these percentages of changes. Since you laid out the statistics, with calculator I have figured out how you got the percetnages of increase or decrease. I had pulled the changes for St. Augustine, FL area. I compared 1st qtr 2008 and same time period 2009. Now that I know how to do the math, and I also concur, we too are on the mend. Number of homes sold in St. Johns County has increased 16%, although average sales price has decreased by 28%. the absorption rate has improved a whooping49%. Activity has increased over April and May. So maybe time to do the numbers again. Thanks the math!

Great news ! In challenging times now more than ever our clients need coaching as the fear and consistent negative news plays in the masses. I like to lead conversations into interest rates and financing and ask the client or potential prospect do they like low rates ? Inevitably they will always say yes.

Keep on Rockin in Arizona !

Jeff Dicks

Coldwell Banker Howard Perry & Walston

www.JeffDicks.com

Watching what you do with Jeff's comment above... Not a member... leaves a link... In your state but not necessarily your market or I would hope he would not do that.... enough about that.

I think things are changing in Central Ohio... I hope things are changing in Central Ohio. I am keeping a close eye on some areas where things are selling out from under my buyer clients.

We are finding the same thing here in Tucson. Even getting many more walk ins on floor duty.

Good luck

Rich

In the Charlotte area, sales are picking up. Foreclosures, pre-foreclosures and short sales are making up an increasing percent of the business.

Glad to hear that Troy... That is what I am looking for and especially like Cheryl's comment above is helpful to know. It is a very optimistic outlook....

that's encouraging.....I hope it works it's way around the US everywhere.

Patricia Aulson/Portsmouth NH Real Estate

Glad to hear it, and I have heard it from other phoenix area Realtors. How are the outlying areas doing? It seems that your exurbs were hit hard.

Hmmm.... while sales are definitely up, no question, sales of what? Most of the realtors I speak with tell me they are busy selling foreclosures and short sales in the $200k range and less. This is the active market. If you speak with Scottsdale Realtors, you will hear a very different story.

I think you are seeing increased sales activity in a very segmented part of the market, and it's not reulting in the "move up" market from what I have seen. Most of the buyers are first timers, all cash, and lots of investorts again trolling for bargains.

We are thankfully very busy, but I think we will continue to see declining values in the Valley and with rates again headed upward this will have some pressure on slowing down sales. I am not trying to be negative, just real. It's way to early to tell where were headed yet.

Not tyring to throw cold water on things, but too many Realtors use these statistics to paint a much rosey picture then is reality.

Gabrielle, Rich - I feel that Arizona is on the rebound.

An - Glad I could help you calculate the numbers, and good to hear things are improving in Florida.

Jeff - I believe the low interest rates are definitely helping.

Maureen - Jeff is not in my area, but not cool to leave a link. Had some homes bought from under my buyer clients as well, and that was when I knew things were starting to turn.

Cheryl - We are seeing more bank owned homes being purchased, and buyers steering away from the hassle of the short sale. Short sales are very difficult to close, get any response from anyone, and you never know whether the price will be approved or not.

Kathy - The inventory of homes for sale needs to be lowered. There are too many short sales and foreclosures still out there, but there are not as many new one's coming on the market.

Patricia - I am hoping that things will pick up all over.

Joe - Areas like Queen Creek and Maricopa are selling because of the drastic price drops they suffered. You can buy a 3,000 sq ft home for $100k!

Mike - I hate to disagree with you, but I feel these stats are all signs of good things. Sales of homes, no matter what kind, is good when you had over 50,000 homes in inventory about a year ago. Of course the lesser valued homes are going to sell first, but that just means we are that much closer to stabilizing. March and April sales were the highest since before 2002 except in 2004 and 2005. How can you argue with 7,681 homes sold in April? The more of the foreclosures and short sales that are sold, the fewer will be on the market, and the more regular resale homes will start selling.

As far as your feeling of most of the purchases being first time buyers, that may be true, but won't these be the same people that may be ready to move up within the next 5 years? With prices and interest rates as low as they are, I do still see stable buyers "moving up" to larger homes.

I know it's still early, but the fact that the average sales price increased for the first time in over a year I thought was also a good sign.

Correct me if I am wrong, but I thought real estate was all about supply and demand. Prices go down when there is a huge supply and not much demand. Once prices reach a certain level, more buyers enter into the market, which lowers the inventory (supply). As supply decreases, prices go up. Our supply of homes has been decreasing for 12 months now.

Nobody can predict the future, but over the past year, things have started to turn around. Pricing may never turn around to a point where it was when it was highly inflated in 2005 and 2006, and do we really want that to happen again anyway?

Hi Troy,

I'm just an outsider looking in, but I think it's great news. Granted, certain things can favorably skew the numbers, but the percentages you show are huge. Hopefully, it a sign of things to come across the country. Thanks for sharing.

I'm with you Troy! We have seen a dramatic shift with many of our listings having multiple offers on them ther first day on the market!!

Oh yes, We do sell those entry level homes very quickly to deserving first time home buyers and cash investors taking vacant properties off the market. We also see high end homes in Scottsdale selling in less than thirty days...after all, a bargain is a bargain.

As a glass is half full type of person, I am going to view the Greater Phoenix Real Estate market through my rose colored glasses and see it as stabilizing, improving and get ready for the banks to release the next wave of foreclosed properties!

Michael - I know numbers can be deceiving, but I am hoping these trends continue. The bigger issue is our economy, the jobless rate, and our national debt. These will all have an impact on housing and real estate.

Judi - Thank you for your input. I am in full agreement with you on this one.

I agree that things are turning around in my area too. It won't be long before more people agree. There are still a lot of people waiting for the bottom but not realizing it will be too late before they find out the bottom was reached and we are on the way back up.

Great info. I much prefer to hear the "good news"!

In regard to te bigger issues: Our economy and the jobless rate will recover as well, we have rebounded before and are a resourceful, enlightened country with the best minds working together to guide us out of the canyon we have wandered into. We all need to contribute where we can, even in the smallest ways, to make a big impact and finally see the light at the end of this tunnel...

It doesn't surpise me. A few weeks ago, one of my college buddies & his girlfriend closed on their first home, one of the last new builds in a Taylor Morrision community after losing out a couple of offers on some short sale properties in the San Tan Heights devolpment.

I am so happy for you guys. It is time and we will all see changes in our markets I believe. All the best, Pat

Hi Troy -- Super news for Arizona, I know it's been very hard there, esp. for folks purchasing in the last few years.

Super new for AZ. i have forwarded a link to your blog to my AZ buyers. Seems like in the last year i had a few people moving to Colorado from Az that are still home owners hoping for a chance to get out of Az but owe more then what the home is worth. I also agree with you about your comments regarding foreclose sales. You have to mop up the foreclosed inventory before you can get back to re-sale sales. however they pay a commission on both so lets do this! Hopefully this helps builders learn about a little calculation i like to call absorption. Learn it builders live it.

Northern VA is moving as well! So glad to see multiple bids, prices increasing for the homeowners. Stinks for those that want to get in on the low end.

Troy,

We've been in business here for 25 years and we lend statewide so we see a lot of different areas. Activity is way up in Phoenix Metro, Tucson, and somewhat in Prescott area. Outlying counties are struggling, but we are seeing more activity recently in the Kingman, Bullhead City areas. Many buyers are investors, but a surprising number appear to be legitimate second home buyers from the snow belt.

Canadians are still trying to buy here, but the financing has kind of dried up for them.

Sales are sales. The sooner we can get the current foreclosure/short sale inventories aborbed, the faster prices will stabilize. If you have had any deals bounced over appraised values lately, you know this is a key issue in returning to a "normal" market with a decent balance of supply and demand.

I'm in Cochise County, the southeast corner of Arizona...we've had much more activity recently...at least people looking again. Sales are starting to pick up, but it is mostly the lower-end properties. However, all of the pre-foreclosures, short-sales, foreclosures, and just desperate seller properties have to be sold first. Then, once we get that stuff out of the way we can resume a more "normal" market again...whatever the new "normal" turns out to be.

It is the same here in Detroit but only because of the first time home buyer credit. But it will be much leaner next year. This is just a false plateau

Ttoy -

Lowered prices brought back demand, which in turn tightened supply, which in turn brought prices back up (but no where near the Good Ole' Days).

I sense the same thing here in Chicago - in certain sectors of the market.

Let's keep up the momentum, across the U.S.

DEAN & DEAN'S TEAM CHICAGO

Troy...good for you and your fellow agents!!! Patience and perseverance are key. It's so tough sometimes. Our foreclosure inventory has been shrinking. This helps stabilize prices a bit. Then you hear all sorts of experts in the media with opinions all over the spectrum. Personally....I see it getting better in the Miami area.

It's great to hear other markets are turning for the better.. Keep listing and selling !

MAY

2009

Tom - Good to hear more positive news.

Judi - I agree, we can't continue going down the wrong path. We will make the changes necessary to grow.

Jonathan - We are seeing a lot of buyers getting beaten out of lender owned properties, no matter the price.

Pat - I think the recovery is coming. It just isn't going to happen overnight.

Chris - Yes, for those who purchased late in 2005 and through 2006, it has been hard times.

Marcus - I hope a lot of people learned a lesson over the past several years.

Kim - The good thing here in AZ is there are still plenty of low end homes available.

Sterling Mtg - I agree

Kellie - Good to hear.

Russ - I don't think it's all about the first time homebuyer credit, but a combination of things that are all happening. I hope this is not a false plateau.

Dean - I'm not so sure the good ole' days were so good, because look what happened immediately afterwards.

Sergio - I know Florida was hit hard just like AZ, so it looks like things are getting better all over.

Roland - Thanks, hope things are, or will soon be, picking up for you as well.

JUN

2009

Troy--good morning from PA. I just read a simlar article about an upturn in activity here in Erie, PA. From the comments your received last month looks like other areas are slowly recovering, but not like the 'good ole' days'.

See you again in the rain soon.

Mary - That is good news to hear. I know part of the upturn is seasonal here in Arizona, but our sales are higher than they have been since 2005/2006.

JUN

2009

Troy--Wow--since 2005-2006--your recovery is well overdue. Good luck gaining ground during the season.

Thanks Mary - Here's to a successful year for you as well.

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