Dr. Jay Butler of Realty Studies at ASU came out with his Phoenix area residential real estate sales and median price numbers for May 2009. Realty Studies is associated with the Morrison School of Management and Agribusiness at Arizona State University’s Polytechnic campus.
Phoenix - Median Home Price
(Excludes repossessions but includes sales by banks after they repossess. ASU calls these “Traditional Sales”)
May 2009: $130,000
May 2008: $224,000
From May 2008 to May 2009 the median home price fell $94,000.
From April 2009 to May 2009 the median home price INCREASED $5,000. The median home price increased in 8 of the 14 cities detailed by ASU.
If we were going to see any increase in the median home price in Phoenix we would expect to see it in May. The overall price trend, however, may still be down. The median home prices in the next few months will tell the story.
Even if prices continue to fall, one thing is certain, the extremely strong downward momentum in the Phoenix median home price has been broken.
Phoenix - Number of Homes Sold
(Excludes repossessions but includes sales by banks after they repossess. ASU calls these “Traditional Sales”)
May 2009: 6,945
May 2008: 4,315
The number of homes sold in the Phoenix area in May INCREASED 61% over May 2008.
{ 11 comments… read them below or add one }
Rich 06.14.09 at 3:26 pm
From April 2009 to May 2009 the median home price INCREASED $5,000. The median home price increased in 8 of the 14 cities detailed by ASU.
Did you cite the wrong article? This quote doesn’t appear in the article you linked, nor could I find any evidence of a $5K increase. The county is up about $3K. City of Phoenix up a bit under $1K. Maybe you meant traditional sales only in Maricopa county? That was up $5K.
John Wake 06.14.09 at 7:18 pm
Yes, the “Traditional Sales” excludes bank repossessions and is the right number to look at.
The “Foreclosed Sales” is a totally misleading number. When there is a Trustee Sale (AKA, foreclosure auction) the “Foreclosed Sales” price is the auction price or if the auction fails and the bank repossesses the home the “Foreclosed Sales” price is the opening bid of the failed auction. Banks usually put the outstanding loan amount as the opening bid. Over 90% of Trustee Sales end up with the bank taking back the property so the “Foreclosed Sales” price in that case (90+%) is totally bogus. No one paid that amount for the property. It was NOT a sale. It was a repossession but ASU is counting it as a sale.
Notice that the “Foreclosed Sales” price is higher than the “Traditional Sales” price. Yeah, like that is going to happen in the real world of real estate.
Rich, I just added a bit to the post to identify the numbers I use as ASU’s “Traditional Sales” numbers. Thanks for pointing out the confusion.
Whizzer 06.15.09 at 2:54 am
As the devastated areas stabilize and even start rising, it is also likely
that more expensive areas will continue to fall in price. As the latter
happens, activity should increase in these areas. Both trends, some
areas actually going up while other areas come down in price, should
lead to additional ‘median price’ increases as the mix of sales includes
more higher priced homes (even if those homes are falling in price).
John Wake 06.15.09 at 10:40 am
Whizzer, I definitely agree that the median price will continue to fall in the more expensive areas. In the least expensive areas, it wouldn’t surprise me if the median price increased a little bit but at this point I would need to see a few months without falling prices before I thought price increases were the most likely scenario.
Shift 06.16.09 at 7:36 am
At some point in time stability in home prices must happen. This is, perhaps, a sign that stability is going to happen sooner, rather than later. The case-shiller numbers will confirm when stability happens.
It would be nice to see the housing market start to firm-up.
For now: green shoots.
Brian 06.16.09 at 6:34 pm
Case-Shiller is always lagging by two months. So it won’t be till the end of July that we know what happened in May. My guess is those numbers will show a decrease in the rate of decline, but still some decline.
But what happens in August to December? This is a traditionally weak period of home sales and it probably will be again this year, especially with the recent increases in mortgage rates while unemployment increases and the economy declines.
The bottom may be close, but it is not yet here.
russ 06.21.09 at 2:53 pm
I remem when I was first out here in 96, there were homes to be had for 89,000 in north phoenix, brand new!. In my opinion we are going back to those prices, lower even.
People, “investors” are out there buying houses now but that will not stop the slide. THey are jumpin in too soon. Investors run into the stock market too soon all the time, its called a “suckers rally” on the way down. “Investors” have been buying houses since 2007 and are eating their investments for lunch.
Incomes are stagnent and declining…My income has been flat since 96, and actually down about 10%, because of this trend, the probability of still lower house prices is not a wild shot…I was making more in 92 than I make now. No one is reporting on the direction of incomes, only house sales statistics…
On my street late last year we had our first foreclosed foreclosure. This was a house that was foreclosed in 2007, bought, then foreclosed again in 2008!…Now, whoever bought it, is doing major renovation…over the last 5 months, while the price of homes continues the downward slide, especially since January. All the money and work on that house is going down the rathole.
In the 80 and 90 downturns, incomes were still rising, but now with globalization and illegal immigration, American jobs are an endangered species. Large established companies are dropping out left and right…and when they do its not just jobs that are lost, but pensions, investments, bond holders et al are getting wiped out like never before, yet little of this hits “the news”. In my field it is getting progressively harder and harder to find work. Where usually it takes me 2-3 weeks to find work, it took 10 months before i could find something. After a few months of looking I was offered a contract in China…I should have taken it not realizing it would be another 8 months before something would turn up……And a job that needs the person on the site is not safe either as illegal aliens are taking over all kinds of jobs, like trucking for example. And companies hire them cause they are cheaper, again in an effort to survive. On top of that, more companies are exporting jobs to make their stuff “over there” in an effort to make their products cheaper and survive. Trouble is everyone is doing that, so the products come back to Americans who dont have jobs to buy the products. Heck, banks are using call centers in India and Costa Rica to dun Americans who are behind on their charge charge payments, again in an effort so save money.
Now on top of that the gov is starting to run everything….its not good…higher taxes are the only way to cover that, so income will be further depleted than it already is…that is, for those of us who have an income.
WHen we hit bottom… if you look at the things that are needed for a recovery, like job growth, economic growth, etc, its just not there, and nowhere in site…. it will not be a bounce…it will be a “splat”….I think we’ll be down there for a long long time…
John Wake 06.21.09 at 5:16 pm
russ,
You may be right but keep in mind that $89,000 in 1996 is equivalent to $121,308 in 2009 dollars.
In addition, north Phoenix is a better location in a lot of ways than was. It isn’t as far out as it used to be.
Today north Phoenix has better drivetimes to jobs with the freeways and road improvements built since 1996, and we have a lot more jobs near to north Phoenix.
I don’t think we are too far off the median home bottom. The median home price has already fallen almost $145,000. We could do another $10,000 standing on our heads.
russ 06.21.09 at 5:55 pm
Johy, THatz my point
in 1996, I was making $120,000, now I’m making 90,000….
if you think we are only 10,000 from the bottom then good luck with that number, you’ll be standing on your head for a long long long long time….
russ 06.21.09 at 5:56 pm
sorry I typo-ed your name John….
John Wake 06.21.09 at 7:54 pm
russ,
No problem.
The median price of single family homes sold in the City of Phoenix in May 2009 was $69,000. (See the link in the first paragraph of the post.) That means half the homes sold in the City of Phoenix were $69,000 OR LESS!
North Phoenix may fall some more but I don’t see the median price in the City of Phoenix as a whole falling a heck of a lot more, if at all.