In Housing Market

Let’s go back in time and look at the Phoenix Real Estate Market as it was in 2010. Compared to the way things are today we see that the more things change, the more they remain the same.

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:

Total Property Sales
County March 10 April 10 MOM % +/- YOY % +/-
Maricopa 9,116 9,650 5.86% 14.00%
Pima 1,610 1,596 -0.87% 21.28%
Pinal 1,390 1,371 -1.37% 6.44%

Monthly Breakdown (April 2010):

Maricopa County Pima County Pinal County
Single Family Homes 8,214 1,324 1,201
Condo/Townhomes 832 113 9
Mobile Homes 80 39 39
2-4 Plex 47 11 2
Apartments 25 0 2
Commercial/Industrial 142 25 9
Agriculture 3 0 2
Vacant Land 291 80 91
Other 16 4 11
Totals: 9,650 Sales 1,596 Sales 1,371 Sales

Top Zip Codes For Sales:

County Highest Number of Sales Zip Code With Highest Sale Price
Maricopa 85326 (Buckeye) 218 Sales 85255 (Scottsdale) 112 Sales
Pima 85614 (Green Valley) 111 Sales 85718 (Tucson) 31 Sales
Pinal 85143 (San Tan Valley) 176 Sales 85118 (San Tan Valley) 10 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:

Building Permits
County March 10 April 10 MOM %+/- YOY % +/-
Maricopa 1,598 1,447 -9.45% -3.02%
Pima 498 461 -7.43% 20.37%
Pinal 245 205 -16.73% -28.42%

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

County Custom Homes New Homes Residential Permits Commercial Permits Pool Permits
Maricopa 32 415 395 251 354
Pima 18 152 152 91 48
Pinal 4 115 18 15 52

The Top Jobs In Each County For April:

County Job Description Permit Value Permit Date
Maricopa Musil Custom Home
Scottsdale, AZ
$1,285,482 4/15/2010
New Cafe Bakery
Phoenix, AZ
$19,100,000 4/16/2010
Pima Merens Custom Home
Oro Valley, AZ
$850,000 4/02/2010
New Marana Heatlh Center
Marana, AZ
$10,843,784 4/22/2010
Pinal Nevitt Custom Home
San Tan Valley, AZ
$303,585 4/12/2010
New Wood-McCaslin Building
Casa Grande, AZ
$1,600,000 4/28/2010

If you would like detailed information about our weekly building permit report, click here to find out more about the Hot Sheet Building Permit Report.

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:

Foreclosure Filings
Type March 10 April 10 MOM % +/- YOY % +/-
Maricopa 8,016 7,057 -11.96% -22.28%
Pima 1,079 891 -17.42% -18.48%
Pinal 987 842 -14.69% -30.81%
*Notice of Trustee Sales

Monthly Breakdown (April 2010):

Maricopa County Pima County Pinal County
Single Family Homes 5,666 703 746
Condo/Townhomes 939 73 14
Mobile Homes 107 60 7
2-4 Plex 88 16 0
Apartments 21 3 0
Commercial/Industrial 91 15 1
Agriculture 4 0 4
Vacant Land 138 21 30
Other 3 0 0
Totals: 7,057 Notices 891 Notices 842 Notices

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

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