Market Data from November 2008 for Maricopa, Arizona indicate some troubling signs. Banks have continued to unload properties in masses onto the market. Most of 2008 Active Foreclosure listings varied between 130 and 190 at any given time. The numbers dipped in late August and Activity halted as news of a bailout and the take over of Fannie Mae and Freddie Mac became apparent. Banks appeared to have held back some inventory in hopes that the Federal Reserve would purchase some of these "Toxic Assets". As the strategy changed by the FED banks then began to quickly add homes to the market. Currently we have 330 Active Foreclosure listings.
Sales volume also saw a significant decrease in November 2008 dropping to a total of 124 sales for the month in Maricopa, Arizona. Price indicators also dropped to new lows with the Average Price Per Square Foot dropping to $59.36. The entry level home market and large homes (Above 3000 Sqft.) are currently over supplied. Entry level homes are currently selling as low as the mid $70,000.
It is no secret that the US Economy is facing a very serious downturn. Maricopa has been hit very hard by both falling home prices as well as a weak job market. A recent study pegged the Maricopa unemployment rate at 8.2% over 2% higher than the unemployment rate for the State. Home prices have dropped to a point where the issue for primary home buyers has less to do with affordability and more to do with job security.
There is some positive news for the market. Mortgage rates have dropped significantly and loans for Primary Home Buyer's are readily available thanks to the government backed FHA loans and USDA loans. Investors in particular are seeing the most effect in attaining loans do to the freezing credit markets. If this loosens even just a little bit we will see a massive wave of investors purchasing at the current prices. Cash Flow is very possible which hasn't been the case in the past. Investors are already targeting the area and want to buy but simply can't because of the lack of reasonable loan products. I believe there will be a loosening of credit very soon for established investors. There has to be for us to see any type of significant recovery soon. Primary Home Buyer's over all are not in a position because of the weak economy and job market to buy in masses. Many will rent until they feel more secure about their jobs and the over all economy. The fear of further home price decline is subsiding. Prices are already at jaw dropping levels. The savvy buyer will put fear aside and look at the numbers. This is the time to buy!
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