What's really going on in the Far South Valley of Albuquerque as far as real estate sales are concerned?

This area, labeled "Valley Farms," or "Area 91" in the Albuquerque area MLS, is located along the Rio Grande Valley in the southernmost area of Albuquerque. The area ranges from small, older homes on small lots through newer, high-end estates and also still contains a large number of true, traditional old farms and horse properties.

I ran the statistics on single family, detached home sales for the past 10 calendar quarters for this area, and here's the result:

This is really a very interesting result. While it is easy to see that average sales prices in the area have been down significantly for the past 12 months compared to the values that showed for the previous 12 months, quite a lot of that difference can be accounted for by the simple fact that there simply were NO Sales over half a million in the area in the past twelve months. In other words, the very high end market has simply been completely stagnant. When there are no very high-end sales to balance out the low end sales, the averages drop.

The chart above is very visually striking for the huge spike in "High Sales Price" figures for the last three quarters of 2007, probably the high point for our Albuquerque real estate market in general. This resulted in a matching, but much slighter, increase in the average sales prices for the same period.

In 2008 and so far in 2009, Valley Farms has lacked any sales over $500,000. Yet the average sales prices in the last quarter of 2008 actually slightly exceeded the average sales prices for the last quarter of 2007!

For the first quarter of 2009, average prices dipped back down, but one notices that this is a common phenomenon for the first quarter of any given year. In fact, our average prices for First Quarter 2009 are nearly $10,000 higher than they were for First Quarter 2007.

The statistics reveal that we have had no drastic drop-off of sales prices in "Valley Farms," the far South Valley of Albuquerque. What we did have was a sudden surge in high-end sales during the last three quarters of 2007, resulting in a substantial increase in average sales prices for that period. We are now back to the kind of average prices, and "high-sales" figures that we saw before the 2007 price explosion. And this is despite the presence of numerous foreclosures and short sales on the market.

The rumors of "real estate death" may have been substantially exaggerated, at least for this area. But there are some additional pertinent facts to discuss, namely time on the market and number of sales, which I'll address in my next post.