Phoenix AZ Real Estate Market October 2011
As of October 2011, we are continuing to see a tightening in the Phoenix AZ real estate market. Active listings (excluding listings with offers) are down to 19,897 which are a leading indicator that prices could begin to rise.About 15,000 of these are single family homes. Last year at this time there were 36,865 active listings on the market, so by comparison we can see why nearly every home that has gone into escrow has had multiple offers. The Phoenix AZ real estate market was one of of the first markets to suffer the downturn and likewise will most likely be the first to recover. Net migration to the state is still strong, the business climate is favorable towards attracting businesses, and the cost of living indices are low.
The average days on market is still around 100 days and this has remained unchanged for the past two years. The average price per square foot is $80 which is down from $87 last year and $89 two years ago; here again this might be changing with the current supply and demand issues. There has been much talk about a “phantom inventory” of foreclosures that the banks have not released to the market; this theory is becoming more dubious as time goes on. I personally still question the “gap” between the record notices of sale and the amount of foreclosures that have sold…I still think the numbers don’t add up.
Back to the Phoenix AZ Real Estate Market: The average size of the homes that have sold has remained unchanged at about 1,987 square feet for the past two years so the pricing decreases in the Phoenix AZ real estate market are not due to larger homes being sold, yet there are still many other factors that go into pricing so it is difficult to pin point the exact causes of the shift in prices. Bank owned sales YTD have represented 44.3% and Short Sales 23%; the sum total of bank controlled sales is 67%. These numbers are virtually unchanged from last year; however, compared to two years ago we have seen a 10% drop in bank owned sales and a 10% increase in short sales. What this tells me is that banks are starting to “play ball” with negotiating short sales – albeit I still jokingly refer them as “Long Sales” because we are looking at 90-120 to get one of these deals done. Banks are also requesting a waiver in the bank owned sales because they know the prices are “somewhat artificially low” and all cash investors will pay above appraisal. All in all things might be looking up for the Phoenix AZ real estate market. to view last months market up date on the Phoenix AZ real estate market.