Home Inventory in the Phoenix area dwindling

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) November 27, 2009 -- Inventories of existing single-family homes in Phoenix area are dwindling, reaching just four months of supply as the sales pace picked up from May to October, the National Association of Realtors reported.

Home sales historically trail off during the fall and winter months, The NAR said, but lower home prices, low mortgage rates, and the extension and expansion of the federal homebuyer tax credit are expected to drive home sales through the end of the year and into the middle of 2010.

The total number of existing single-family homes sold in Maricopa County for the 3rd quarter of 2009 was 35,745 in October, up 15 percent from a year ago, the group said.
The month’s supply of inventory fell from 6 months a year ago, to 4.2 months this quarter. A 6-month supply of inventory is about what analysts consider an even balance between supply and demand.

On the other hand, the median home price for a Maricopa County home has dramatically decreased compared to 3rd quarter last year. The median home price in the 3rd quarter 2008 was $180,765. Compare that to the median price this quarter of $139,900, which shows and year over year difference of 29.2%. This is in large part due to the increasing number of distressed property transactions. A distressed property is typically described as a foreclosure, pre-foreclosure, or a short sale.

Although there is a 29.2% decrease in median price from 3rd quarter 2008 to 2009, there has been a consecutive monthly increase in prices since June 2009. Jessica Leimbach, a local real estate expert, cited that trend, along with continued strength in sales, as "signs that the Phoenix area has hit and passed the bottom of this real estate cycle."

“For the first-time in over two years,” she said, “values of homes are increasing, and the number of distressed sales as a share of total sales has shown improvement since the beginning of the year.” Loan modifications and other efforts to keep homeowners out of foreclosure has led to a decline in inventory levels since the start of the year.

Mrs. Leimbach added that in order for us to see appreciation, we must first see the depreciation drop off considerably. That is now starting to happen. Jessica Leimbach is an associate broker for M&B Realty, out of Mesa, AZ. For more information please visit www.jllrealestate.com. You may also call 602-904-6343.