Price (green line)
The median home price was essentially flat at $209,900 in April after $210,000 in March.
Sales (blue line)
Homes sales in metro Phoenix in April were surprisingly strong.
There had been some talk in Realtor circles about strong sales of existing homes in the outlying areas (where prices have fallen so much). See my post last month about the market tightening up in Anthem and Johnson Ranch. Now, we’re seeing hard numbers.
However, home sales are not higher in all areas. You can study this press release from ASU Realty Studies to figure out where sales are still slower than last year.
Home sales in Scottsdale, for example, where lower in April 2008 compared to April 2007 while home sales in Avondale more than doubled.
Listings (red line)
The uptick in home sales drew down the inventory of homes for sale. We are probably also seeing the lower median home price discourage some homeowners from trying to sell their homes.
The correction continues. The number of listings available for sale fell 2.3% from mid-April to mid-May. Last year, listings increased nearly 2.8% over the same month.
Conclusion
Clearly, we are seeing the beginning of the end of falling median home prices, although it could be many months before we see the end of the beginning.
“MLS Listings” are measured at one point in time, usually the 15th day of the current month. “Median Price” of homes sold and the total number of home “MLS Sales” are for the entire preceding month.
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Cbass 05.15.08 at 11:29 pm
John,
I heard a nasty rumor that forclosures are not counted as inventory by the NAR but the sales are counted against existing inventory. Can you shed some light on this subject for me. I know we have massive forclosure numbers piling up across the US, not to sure how AZ is fairing, but I would think that forclosure sales should not be counted by NAR if the inventory is not being counted as well. I realize that keeping track of the inventory would be hard but removing the sales from the data set seems like a logical solution to keep that from tainting the data. Thanks in advance John for any info you can give me on this.
John Wake - Real Estate 05.15.08 at 11:41 pm
The graph above (I don’t know about NAR) is based on the local MLS numbers. They don’t care if the home is bank-owned, pre-forclosure or whatever, if it’s listed for sale in the MLS, it shows up in those numbers. If it sells while it is listed in the MLS, it is counted as a “sold.”
krogers 05.16.08 at 1:37 pm
John,
The wife and I are looking to buy a house towards the end of the year, after our current lease is up, but we have some flex time. The concern I have is that while housing prices are continuing to decline, we might miss the “sweet spot” for interest rates. Since the month trend from March to April was such a low price drop, do you think this predicts that, while prices may continue to drop, it will continue in such small amounts over the next few months?
Just wondering if it would be worth it to play the waiting game, saving up more of a down payment, or go in while we know the numbers look decent, but have less to put up front.
Cbass 05.18.08 at 9:32 am
So you are saying only the homes listed on the MLS are counted in the sales numbers when a home is sold. If a forclosure was sold at auction or via some other medium then it would not be counted as a sale because it was not in the MLS.
Very good thanks for clearing that up John.
John Wake - Real Estate 05.18.08 at 10:31 am
Cbass, for the graph above that is right, it’s based solely on MLS data, it’s not based on all homes for sale or sold, however, most homes are sold via the MLS.
Other graphs on this website use different data sets.
John Wake - Real Estate 05.18.08 at 11:18 am
krogers,
On the one hand, the median home price tends to weaken a tad in the second half of the year, and the general trend in prices has been downward.
On the other hand, interest rates may increase.
There is no clear cut answer. Other factors may be the tie-breaker, such as your family situation, how much you can save for a down payment between now and then and how that increased down payment might affect your mortgage rate and terms, and other factors. Feel free to call me to talk about it.
What part of town are you planning to buy in? Kind of home? Price range? That could have an impact.
Frank 05.20.08 at 8:39 am
Have you seen this in the Republic, “Valley home-sales reports are at odds”, http://www.azcentral.com/realestate/articles/0520biz-homesales0520.html
bs512 05.25.08 at 10:58 pm
krogers,
Same time last year I was thinking the prices are kinda hovering around a bottom. I was thinking of purchasing at the end of 2007. Boy, am i glad i didnt.
The foreclosure homes are taking the comps down. Inventory is still way too high(approx 14 months of inventory). Until we reach a healthy 6 month inventory, the prices wont stop falling. Sit tight and wait for a stable market.