Arizona Real Estate Notebook

Karl Guntermann at ASU updated his Repeat Sale Index through October 2008.

(The graph above was created by John Wake of HomeSmart using ASU data. The graph is not included in Guntermann’s report.)

… the median declined to $160,000 in October. That puts the median house price back to the level of March 2004, close to the start of the current cycle. The preliminary median house prices for November, $150,000 and December, $140,000 would put prices back to the levels of October 2003 and April 2002, respectively, essentially eliminating all appreciation in house prices from the current cycle.

Guntermann also looked at the median home price and calculated a trend line.

Perhaps the most important question that homeowners have relates to how much further house prices are likely to fall. While it is impossible to predict where prices will level off, Figure 2 contains a comparison of the trend in median house prices used in the ASU-RSI with actual and estimated median prices through December 2008. The trend is estimated using the RSI database from January 1989 through the end of 2003 and it is then projected through December 2009. As difficult as the market correction has been, the data show that in July, median house prices returned to their long-term trend at approximately $191,000. The September median price of approximately $174,500 has declined to $160,000 by October. When compared to the peak median price, $262,500, the magnitude of the decline in house prices over the past two years is apparent.