A new year, a new leaf for the Scottsdale and Phoenix real estate markets? Let’s do the numbers and see . . .
Number of Monthly Home Sales in Phoenix (red) and Scottsdale (blue) Since 2001
- Monthly Home Sales in Phoenix and Scottsdale Real Estate Markets
Source: www.cromfordreport.com
The take-home message: Monthly Phoenix home sales reached higher levels in 2009 than in any other years of this decade – peaking at 2,262 in May, 2009. Hearty demand for Phoenix homes has eaten into (though not erased) the inventory of unsold homes left over after the real estate bubble burst. While there is still excess inventory on the market, demand and supply have begun to equalize (which is why we’re seeing Phoenix home price increases, too). As home prices rise, the demand tapers off, which is what we’ve seen in the Phoenix real estate market in the latter half of 2009 – and that’s a good thing.
Scottsdale home sales, like Scottsdale home prices, have not experienced the same wide fluctuations as sales and prices have in the Phoenix real estate market. In Scottsdale, home sales began the year at 170 in January, peaked at 426 in June 2009 and hovered for the rest of the year between 330 and 370. We’re seeing the same kind of tapering-off in Scottsdale home sales as we are in Scottsdale home prices, a sign I think that the real estate market recovery there will be more gradual than in Phoenix (which makes sense, since the bust was less dramatic in Scottsdale as well).
Median Home Sales Price in Phoenix (red) and Scottsdale (blue) Since 2001
- Monthly Home Sales Price in Scottsdale and Phoenix Real Estate Markets
Source: www.cromfordreport.com
The take-home message: Phoenix home prices trended significantly upward over the course of last year – from a low in March, 2009 of $60,000 to end the year at a December median sales price of $99,000. December was down a bit from November, when sales prices peaked at $110,000, but there’s no indication yet that dip is a permanent trend. In fact, it’s more likely that November’s high number was an aberration – at $102,900, the October median price of a Phoenix home was closer to December’s price.
In the Scottsdale real estate market, median prices did not fall as steeply in 2008 as they did in Phoenix. Through 2009, Scottsdale home prices have remained relatively stable, within some month-to-month fluctuations. The year began at a low of $388,000 then peaked in February at $454,000. Since then, Scottsdale home prices have hovered between $385,000 and $410,000.
More on the Phoenix real estate market and Scottsdale homes market according to Jay Butler, Associate Professor of Real Estate at ASU:
- “Foreclosure activity has been the dominant force in the resale market. For 2009, there were a total of 46,980 foreclosures (42 percent) while 2007 had 8,535 foreclosures (16 percent). Another significant component of the market was the sale of previously foreclosed property, which accounted for approximately 51 percent of the traditional transactions (5,740 sales). Thus, foreclosure–related activity represented 67 percent of the recorded activity.”
- “A key factor in sustaining a housing recovery is the satisfaction of pent-up demand, which is initially driven by entry level households that are not burdened with the problem of selling a current residence.”
(For more information, check out Butler’s December Phoenix Real Estate Market Report.)
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