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In a separate move today, the U.S. government said more than 400 people were charged in a federal mortgage-fraud sweep called “Operation Malicious Mortgage.”
I just uploaded the sales data for 124 zip codes in Maricopa County, Arizona.
The number of single family detached homes sold increased significantly in several zip codes in May, however, the median sold price per square foot continued to drift lower in most zip codes.
You can check out the real estate market in your favorite zip codes by clicking on their links in the right-hand sidebar.
If you use Firefox as your browser (as opposed to Internet Explorer), I very highly recommend that you update to the brand new version, Firefox 3, that was released today.
The zip code maps (and the future maps of new listings in each zip code that I’m working on) load MUCH faster with this new version of Firefox.
If you use Firefox, you’ll really like Arizona Real Estate Notebook much more after installing Firefox 3.
The median home price in metro Phoenix continued to fall to $205,000 in May despite a relatively strong number of homes sold for the month.
The May 2008 median home price is exactly $50,000 less than in May 2007. That is, the median home price in metro Phoenix was 24% higher a year ago.
Sales (blue line)
Homes sales in metro Phoenix in May were very strong at 5,600 homes. We haven’t seen a number that high since before the mortgage meltdown in August of last year.
Home sales started out the season slow, we didn’t see big numbers in March this year like we usually do, but sales took off late in the season, April and especially May.
It will be interesting to see if the strong sales continue into June. Strong closings in June is a sign of a strong market. In most years, sales tend to fall off a lot from May to June.
Listings (red line)
The number of listings continued to fall in June, just the opposite of what happened last year.
The number of listings available for sale fell 2.9% from mid-May to mid-June. Last year, listings increased 1.7% over the same month.
That’s a totally different market dynamic. It’s funny how a huge price decrease can change things.
Conclusion
The market is starting to adjust… finally. But it has a long way to go to get inventory in line.
A year ago I didn’t think the median home price would go this low and certainly not this quickly. With the huge inventory of homes for sale still overhanging the market, prices could conceivably go crazy low in the same way they went crazy high earlier.
“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.
Here is some useful information that will help you create a do-it-yourself Competitive Market Analysis (CMA) for your Arizona home.
1) Sold Homes - Finding prices of homes sold in Arizona
Home Sale News
If you subscribe to Home
Sale News and study it carefully each week, after a few months
you will have an EXCELLENT idea of the value of your home.
Arizona Real Estate Notebook
You can also see individual Arizona homes sold online at Arizona Real Estate Notebook. This web site has a ton of data, charts and graphs about the metro Phoenix real estate market and the real estate market in 125 Phoenix area zip codes. The web site is invaluable for both Arizona home buyers and Arizona home sellers.
azcentral.com
If you’re in a hurry, try azcentral.com
which has recent home sales by zip code. It doesn’t have the detail
of Home Sale News, or Arizona Real Estate Notebook but their sales data goes back 12 months which is very useful.
Zillow.com
You can find comps in your neighborhood from a map at Zillow.com.
It’s nice to work off a map but their comps are a bit old. I’m seeing homes that closed 3 to 4 months ago. At Home Sale News, ArizonaRealEstateNotebook.com and azcentral.com the homes sold data is only about 3 weeks after closing.
BEWARE: Zillow home value estimates, which they call "Zestimates," are not very good. They are just ballpark estimates of your home’s value.
Zillow itself says that 39% of Zillow home value estimates are off by 10 percent or MORE in Phoenix Arizona.
That means if your home is worth $400,000, there’s a 39% chance Zillow will tell you your home is worth $440,000 or MORE, or $360,000 or LESS.
It’s a huge loss of money, obviously, when a home seller sets the sale price too low by 10% or MORE. But it is often very expensive as well when a home seller sets the sale price too high by 10% or MORE. (Call me to explain why.)
Maricopa County Assessor
If you want information on the sale of an individual home in your
neighborhood, you’re best bet is the website of the Maricopa
County Assessor. Their website, however, isn’t as up-to-date as
Home Sale News, ArizonaRealEstateNotebook.com or azcentral.com.
2) For-Sale Homes - Finding homes for sale prices in Arizona
The value of your home is also affected by the asking prices of Arizona
homes for sale that are comparable or competitive to your home. The final sale price,
of course, can be more or less than the asking price.
Nevertheless, you should know what your competition is asking for
their homes because it affects how much you can get for your home.
A higher interest rate would strengthen the U.S. dollar and lower the price of oil in the United States. Think of what cheaper oil would do for the American economy!
But, alas, the Fed is trapped. The U.S. housing bust seriously undercut the integrity of the U.S. banking system and that’s where the Fed has to focus it’s attention by keeping interest rates low… for now.
As soon as the housing market and the mortgage banking market look a little less precarious (and certainly sometime after the presidential election is over), I’m sure the Federal Reserve will be under strong pressure to raise rates.
The next 6 to 9 months may end up being the sweet spot of the current housing cycle with both low prices and low interest rates.
Metro Phoenix home sales haven’t begun to bounce back to anything close to the same degree… yet. (See the blue line in the graph below.)
And it’s easy to see why
The upswing in demand that we’re seeing in Sacramento County is a result of falling prices… This May’s median home sold for $225,000, down 34.4% from last year’s median of $343,000.
Looking at Arizona MLS residential real estate sales data for metro Phoenix, the median home price fell from $250,000 in April 2007 to $209,900 in April 2008 (latest data available). That is a 16% decrease versus Sacramento County’s 34% decrease in median home price.
The number that best explains the huge fall in the Sacramento CA median home price is here; “REO’s continue to account for the bulk of sold homes, at 64.1% of sales in May.”
64.1%? Yikes!
Sacramento makes the Phoenix market look absolutely sunny.
ADDED: Home sales in Sacramento can’t maintain this high pace without eventually putting upward pressure on prices. In fact, higher prices may be what eventually slows the pace of home sales.
If you want all of the advantages of living in a brand new home but you don’t want to live halfway to Flagstaff, check out this home.
You can get a new four bedroom, 2,742 square foot home for only $375,000!
The downstairs bedroom would also make a great office. The kitchen has nice upgrades including staggered cabinets and a kitchen island with pull out shelves.
The front is desert landscaped and the backyard is waiting for your landscaping. It has an 8-foot RV gate for all your toys.
Many home buyers are interested in bank owned homes.
I wanted to give you an idea of the quantity and quality of bank owned homes. It took some finagling but I was able to jerry-rig in the MLS a way for you to see homes listed as being bank owned in Scottsdale, Arizona.
Just be aware that bank-owned homes are often, not always, but often are in tough shape. The future former owners have a tendency to take out their frustrations on the old four walls.
There are other complications with bank owned property such as “as-is” and slow response time from the banks.
Call me for details.
ADDED: I just noticed that someone is marking homes as “Favorites” and adding comments. I’m sorry but I don’t know who you are. If you would like me to set up a similar web site for your exclusive use, please call me at 480-596-3851. John
That is, after you reach an agreement with the home seller (perhaps after a few counter offers back and forth along the way), I will take the signed contract including all counter offers, addendums, and your earnest money check to the escrow company named in the contract. I do this the next business day after an purchase agreement is reached.
The escrow company will cash your check that day or the next day. The funds will be deposited into your escrow account at the escrow company.
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