Mid Month Pricing Update and Forecast for Maricopa/Pinal County

Real Estate Agent with Realty One Group, homes for sale, working with first time buyers
Mid Month Pricing Update and Forecast for Maricopa/Pinal County

Each month about this time we look back at the previous month, analyze how pricing has behaved and report on how well our forecasting techniques performed. We also give a forecast for how pricing will move over the next 30 days.

Sneekpeak at the Cromford Tool


For the monthly period ending May 15, we are currently recording a sales $/SF of $98.31 averaged for all areas and types across the ARMLS database. This is 5.1% higher than the $93.50 we now measure for April 15. Our forecast range was $95.68 to $99.58 with a mid-point of $97.63. This month the actual value was within 0.7% of the mid point of the forecast range, so we count ourselves once again content with that result. We have also justified our prediction that positive annual appreciation would be reported from November 29 onwards. Yesterday's price level was 17.7% higher than last year on May 15. We reiterate our forecast that positive annual appreciation will be recorded throughout 2012 and is likely to easily exceed 25% by September 2012.
On May 15 REO sales across Greater Phoenix (all types) averaged $73.99 per sq. ft. (up 4.4% from April 15). Pre-foreclosures and short sales averaged $74.33 (up 0.9%) while normal sales averaged $115.36 (up 4.2%). Normal sales again gained substantial market share, moving from 53.5% to 57.0% of sales. REOs dropped again from 21.1% to 18.4% and we expect REO sales to continue to lose market share over the rest of this year. Short sales and pre-foreclosures also lost market share, moving from 25.4% to 24.5%.
On May 15 the pending listings for all areas & types showed an average list $/SF of $94.29, 1.6% above the reading for April 15 - so pending $/SF has moved upwards again and is now at its highest level since February 4, 2009. Among those pending listings we have 41.2% normal, down from 42.4% last month, a slightly greater 17.7% in REOs and a slightly higher 41.1% in short sales and pre-foreclosures. The average pricing for pending listings on May 15 in each category was: $122.31 normal, $71.75 short sales & pre-foreclosures and $70.34 for REOs. The slight change in the mix and lower increase in pending $/SF suggest that the rate of increase for monthly sales $/SF will slow down over the next month from the rapid pace between April and May.
Our new mid-point forecast for the average monthly sales $/SF on June 15 is $99.98, which is 1.2% above the May 15 reading, and we have a 90% confidence that it will fall within ± 2% of this mid point, i.e. in the range $97.98 to $101.98. Our mid point forecast implies an annual appreciation of 18.7%.
September 15, 2011 - now measured at $78.84 per sq. ft. - remains the $/SF pricing bottom. The lowest monthly average sales price is $151,072 and this was measured on September 5. However the record low monthly median sales price is still standing at $107,000 and this record low point was set 15 months ago on February 24, 2011. Our current monthly median sales price has moved up to $140,000 (30.8% above the low point) and it looks probable that we will hit $145,000 during June.

Brought to you by;
The source of my new updates: Mike Orr, the author and creator of The Cromford Report, has allowed me to give you a sneak peak every week of his work and commentary. Industry leaders regard The Cromford Report to be the best cumulation of data of our local markets in Maricopa and Pinal County. In 2012 Mike Orr was appointed Director of the Real Estate Center at the W.P. Carey School of Business at Arizona State University. Website is www.cromfordreport.com


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