“For the first time since July 2005, the local resale housing market has posted year-over-year improvement. April had 5,585 recorded sales in contrast to 4,855 sales for a year ago”
The median home price however continued to fall from $220,000 in March to $210,000 in April. That is the lowest median home price since February 2005 which was $200,000. A year ago in April 2007 the Greater Phoenix median home price was $265,000.
Click below to read full press release from ASU.
For Immediate Release
Tuesday, May 13, 2008
Greater Phoenix resale numbers up for April, median prices down
MESA, Ariz. – For the first time since July 2005, the local resale
housing market has posted year-over-year improvement. April had 5,585
recorded sales in contrast to 4,855 sales for a year ago and 4,335 sales
in March 2008. Given the improvement, the basic question is whether
this is the first sign of the much anticipated recovery or merely a blip
in a continuing weak market, said Jay Butler, director of Realty Studies
in the Morrison School of Management and Agribusiness at Arizona State
University’s Polytechnic campus.
“Historically, April is not a strong month and is usually well behind
March, which could have been impacted by the Easter holiday this year,”
The total March and April 2007 activity was 10,245 sales, while 2008 was
comparable at 9,920 sales. The 2008 year-to-date total is 16,975 sales,
while it was 19,045 sales in 2007 year to date.
The median home price declined from $220,000 to $210,000, in contrast to
last year’s $265,000. This is the lowest median price since February
2005 at $200,000.
“One of the driving forces in increased activity has been rapidly
declining prices that have fueled renewed investor interest and
potential owner-occupants, especially in the lower income ranges,” said
Butler. “Investment interest is being driven by the anticipation that
home prices will rise again in the next few years. The lower median
price is being impacted by several factors, including the large number
of vacant homes, especially in certain neighborhoods,” he said.
In addition, capital is available for lower-priced housing, but lacking
in the higher priced housing market. The recent rise in the FHA limit
from $271,050 to $346,250 will help some move-up market activity.
However, the non-conforming limit remains at $417,000, which will be of
little assistance to the higher priced market.
Last year, 41 percent of the resale homes sold for more than $300,000,
while it was 24 percent for April 2008. Influenced by foreclosed
properties, homes selling for under $200,000 have increased from last
year’s 16 percent to a current 44 percent of the local resale housing
market. The most evident impact of lower prices is improved
Even though mortgage interest rates increased from last year’s 5.8 to
5.9 percent, the much lower sales price allowed the monthly payment to
decline from $1,320 to $1,060. While improving affordability based on
lower home prices can greatly benefit buyers, it adversely impacts many
owners and potential sellers whom are watching their limited equity
erode, as prices decline to and even below existing debt level. The
lower prices affect the ability and desire to continue owning the home
and even overall confidence in the economy, which puts additional strain
on the local housing market.
For the last year, the housing market has been confronting issues
derived from the hyper-market of previous years such as the subprime
meltdown and overly ambitious investors. Unfortunately, there is
increasing data, such as job losses and layoffs that the economy is now
weakening and will add further stress for the housing markets, according
“In a weak economy, many households will not have the needed income to
save their homes. Further, with increased energy and food costs, there
is additional strain on the household budget,” he said. “Thus, the
potential economic downturn and inflationary pressures will define how
much further the housing market will worsen and when recovery will
Changes in median prices can vary tremendously throughout the Valley.
For the western suburbs the median price has fallen 24.1 percent from
last year’s $235,000 to $178,431, while East Mesa moved down 8.7 percent
($235,000 to $214,500). Since the Greater Phoenix area is so large, the
median price can range significantly from $563,000 ($605,000 in March)
in North Scottsdale to $146,455 ($148,800 in March) in the Maryvale area
of the city of Phoenix.
With 835 recorded sales, the townhouse/condominium market improved from
the 685 sales of March, but was well below last year’s 1,305
transactions. The median home price decreased from $174,500 in January
2008 to remain for the third straight month at $165,000, while it was
$184,950 for a year ago. The underlying reasons for the fairly stable
price can run the gamut from the return of the seasonal visitor,
international investors, and new households satisfying their initial
The median square footage for a single-family home recorded sold in
April 2008 was 1,770 square feet, which is larger than the 1,700 square
feet for a year ago. The larger size demonstrates that buyers are able
to take advantage of lower prices to upgrade their housing. In the
townhouse/condominium sector, the median square footage was 1,190 square
feet, which is larger than the 1,085 square feet reported a year ago.
* In contrast to April 2007, recorded sales in the city of Phoenix
increased from 1,280 sales to 1,435 sales, but the median sales price
decreased to $178,000 from $225,000 for a year ago. Since Phoenix is a
geographically large city, the median prices can range significantly
such as $146,455 ($148,800 in March) in the Maryvale area to $280,000
($263,500 in March) in the Union Hills area. The townhouse/condominium
sector decreased from 415 to 250 sales, and the median price decreased
from $165,000 to $150,000.
* The Scottsdale resale home market declined from 400 to 330
recorded sales, with the median sales price also decreasing from last
year’s $557,500 to $506,500. The median resale home price is $563,000
($605,000 in March) in North Scottsdale and $266,500 ($260,000 in
February) in South Scottsdale. The townhouse/condominium sector in
Scottsdale decreased from 300 to 205 sales, while the median sales price
decreased from last year’s $264,450 to $262,500.
* The Mesa resale housing market improved from 530 to 590 sales,
while the median price fell from $234,510 to $196,250 ($200,000 in
March). The townhouse/condominium sector also fell from 185 to 100
sales, while the median home price decreased from $158,000 to $140,000.
* Glendale increased from 330 to 385 sales and the median sales
price decreased from $245,000 to $189,000 ($209,750 in March). The
townhouse/condominium sector decreased from 60 to 25 sales, while the
median sales price decreased from $136,250 to $115,630.
* For the city of Peoria, the resale market declined from 250 to
235 sales, while the median price moved from $257,915 to $224,000
($225,000 in March). The townhouse/condominium sector decreased from 30
to 15 sales, and the median price went from $200,000 to $140,500.
* In comparison to a year ago, the Sun City resale market
increased from 115 to 125 sales, while the median sales price decreased
to $176,500 from $210,000. Resale activity in Sun City West increased
from 50 to 40 sales and the median sales price decreased from $222,000
to $205,000. The townhouse/condominium market in Sun City decreased from
60 to 40 recorded sales, while the median home price decreased from
$136,000 to $117,250. In Sun City West, activity stayed at 25 sales,
with the median sales price decreasing from $164,700 to $138,750.
* The resale market in Gilbert increased from 330 to 360 sales,
and the median sales price decreased from $295,195 to $240,065 ($245,000
in March). The townhouse/condominium market stayed at 15 sales, with
the median sales price decreasing from $207,500 to $166,930.
* For the city of Chandler, the resale market declined from 375 to
340 recorded sales, while the median sales price went from $297,950 to
$236,780 ($234,000 in March). The townhouse/condominium market declined
from 60 to 40 sales, and the median sales price dropped from $179,975 to
* The resale market in Tempe decreased from 120 to 100 sales, with
the median sales price decreasing from $285,000 to $248,500 ($237,000 in
March). The townhouse/condominium sector fell from 75 to 40 sales, and
the median sales price decreased from $184,200 to $172,475.
* The highest median sales price was in Paradise Valley at
$1,375,000, with a median square foot house of 3,540 square feet.
* In the West Valley, the following communities represent 14
percent of the resale market.
o Avondale increased from 90 to 190 sales, with the median price
moving from $233,980 to $176,000 ($185,130 in March).
o El Mirage increased from 55 to 85 sales, while the median home
price went from $199,000 to $140,170 ($146,900 in March).
o Goodyear went from 95 to 165 sales, while the median price
decreased from $265,000 to $219,900 ($220,000 in March).
o Surprise improved 235 to 370 sales, but the median price moved
from $246,060 to $200,250 ($205,000 in March).
Realty Studies is associated with the Morrison School of Management and Agribusiness at Arizona State University’s Polytechnic campus. Realty Studies collects and analyzes data concerning real estate in the greater Phoenix metropolitan area. Realty Studies is a comprehensive and objective source of real estate information for private, public and governmental agencies. To subscribe to RSS feed for Realty Studies news, visit http://www.poly.asu.edu/realty/rss.html.