Real Estate Market Update: April 2010

Surprisingly, with the home buyer tax credit officially expiring, sales actually dipped slightly in Pima and Pinal counties but still stayed at extremely high levels in the three county area. Overall, sales posted a 4.14% gain over March led by Maricopa County. Permits in April sagged across the board but overall numbers are being propped up by the pool season which is now in full force. And lastly, foreclosures fell a combined 12.81% in the area. The real barometer of where the markets are heading will be the numbers we see coming in throughout the summer.

Sales Remain At Extremely High Levels As Tax Credit Expires

Sales in the three county area reported the highest sales totals since June of 2009 with buyers who were in position to close early did so to take advantage of the tax credit. April recordings totaled 12,617 sales in the three county area posting an overall gain of 4.14% over March. It was concluded that the second round of the homebuyer tax credit did not have the same effects and was terminated in April. However, we feel most players in the market would have preferred it stayed around. In fact, according to Robert Schiller of Case-Schiller — “The credit interferes with the market in an arbitrary way, but ending it now would be psychologically powerful. People will be in a bad mood about buying a house.” He advocated phasing it out gradually to avoid turning buyer sentiment. So far in May, the market is tracking to a 20% drop in sales volume which isn’t entirely unexpected.

Here is a look at how the markets are doing in your area:

Overall monthly comparison:

Monthly Breakdown (April 2010):

Top Zip Codes For Sales:

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Permitting Unexpectedly Dips Heading Towards Summer

New home permits in the three county area reported their lowest level of volume in over a year with builders perhaps looking to an uncertain summer and cautious view of speculative inventory on the books. This led to a dramatic drop in overall permitting activity, falling a combined 9.78%. However, pool building season appears to be in full force which propped up overall totals in the area. An analysis of the previous three years indicates this was unexpected with April typically turning in double digit increases leading into the summer.

Overall monthly comparison:

Here’s a look at how each segment performed in April:

The Top Jobs In Each County For April:

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New Foreclosure Filings Fall A Combined 12.8%

As we expected, following the extremely high levels of foreclosure activity in the first quarter, initial preforeclosure filings in the region dipped a combined 12.81%. Again, though this is good news, one month of good news does not qualify as the start of a sustainable trend. What will be more telling is the level of activity we see during the summer after the “tax credit hangover” is sufficiently behind us.

Overall monthly comparison:

Monthly Breakdown (April 2010):

Source: Ion Data Express, Publishers of Home Sales, Building and Foreclosure Reports. Toll-free phone: 877-466-5478