Leif Swanson

National real estate sales statistics were published January 25, 2010 showing December 2009’s national sales fell 16.7% from November 2009.

Let’s see how these national numbers compare to the Phoenix metro area:

1) 2008 versus 2009 sales.  Phoenix did 10x better.
National:    5% more
Phoenix:  55% more

2) December 2009 versus November 2009 sales.  Phoenix did much better.
National:  down 16.7%
Phoenix:  up 2.2%

3) Inventory of homes.  Phoenix is doing better.
National:  7.2 months of resale inventory
Phoenix:  5.2 months of resale inventory
(6 months is considered an even seller-buyer market)

4) Median sales price, December 2009.  Phoenix is much lower, which means more affordable.
National:  $178,300
Phoenix:  $126,500

5) 2009 sales prices versus 2008 sales price.  Phoenix performed terribly.
National:  prices fell 12%
Phoenix:  prices fell 31%

Phoenix’s home prices bottomed out in early April and have increased since then.

Phoenix Metropolitan Area Real Estate Statistics - December 2009

What is happening with the real estate market in the Phoenix metropolitan area? What changed in December 2009?

[click on the charts to expand]

1) SALES: December 2009’s sales of 7,661 were much better than December 2008’s 5,504 sales. That’s 39% more sales this December than last December! 85.9% of the sales in December were homes, 12.6% were condos, and 1.5% were manufactured housing.

Sales for the entire 2009 year were over 92,200, the third highest sales year ever.

19.29% of the Phoenix metro area MLS listings sold in December 2009, almost double from December 2008 (which was a weak 10.23%). 20.9% of the homes sold in December; 13.9% of the condos sold; 9.2% of manufactured homes sold. Bank-owned foreclosure properties accounted for 43.2% of the sales in December 2009 down from July 2009’s 53.4%. More and more buyers are purchasing homes from regular sellers. 39% of the total sales in December 2009 were cash. 32% of the sales were with FHA or VA financing.

2) SALES PRICE: The average sales price in December 2009 went up $3,000 to $177,472. It’s still 8% less than December 2008’s $192,739 average. The good news is that this percent difference (2009 vs. 2008) is decreasing.

The median sales price in December 2009 decreased to $126,500. This was 11.5% less than the median sold price of $143,000 in December 2008. The number of cash buyers spiked in December, which might account for a higher number of low priced homes skewing the median. The Phoenix metropolitan area real estate market bottomed out in early April.

75% of the sales in December 2009 were below $200,000, 83% under $250,000, 92% under $350,000, and 96% under $500,000.

3) INVENTORY: Did the absorption rate go down (the # of months’ inventory available for sale)? The inventory of homes in December 2009 decreased slightly to 5.2 months. It was much better than December 2008’s absorption rate of 9.8 months. A balanced buyer-seller market is six months. The absorption rate in December 2009: 4.8 months for homes, 7.2 months for condos, and 10.9 months for manufactured homes. Therefore, it is a seller’s market for homes in the Phoenix metropolitan area.

4) NEW MLS LISTINGS: In December 2009, the number of new listings was 10,453, which was less than December 2008’s 11,894 new listings. Inventory decreased to 39,709 active listings. Currently there are 34,700 active listings, down from January 2009’s 52,685.

5) AVERAGE DAYS ON MARKET: Phoenix area homes took a little longer to sell this December at 73 days. However, condos sold quicker than usual at 87 days in December 2009.

6) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in December 2009 was 96.25%, which was better than December 2008’s 94.74%. A normal market has sellers keeping 97.5% of their final list price.

7) PENDING SALES: Pending sales are a great indicator of future sales. Foreclosure and short sale listings are leading the way with pending sales. The pending sales numbers were very strong in December 2009, reaching better levels than in all of 2008, 2007, and 2006. Pending sales in January are tracking historically strong but lower which is seasonally normal. The Phoenix real estate market activity is now performing higher than 2005 levels, except that prices are lower. In September, there were over 20,000 properties under contract (pending & contingency), an all-time record. We’re currently at the 16,650 mark. Short sales make up 55.6% of the properties under contract, which skews the numbers (looks good, but doesn’t count if they don’t convert to actual sales).

PRICE PER SQUARE FOOT: It rose to $92 per square foot in December 2009, which is historically low, but the best since January 2009. Multiple offers and declining inventory should have helped this statistic go up. Looks like March 2009 was the bottom of the market for price per square foot. The price per square foot a year ago was $99. Check out the chart!

9) VACANT HOMES: An unprecedented number of Phoenix metro area MLS active listings still are vacant. Sold homes have an even higher number of vacancies. Vacant properties accounted for 77.1% of all properties sold in December 2009, but it dropped off a hair as more buyers purchased occupied homes. This was the 10th month of decline. The normal is under 40%, however. The vacancy rate of sold properties in December 2008 was 85.6%.

10) ASKING PRICE VERSUS SOLD PRICE: Is there any difference between asking prices and sold prices? Yes. The average new list price in December 2009 was $209,773. This was $42,500 less than December 2008’s average new list price. Due to lower priced foreclosure listings and short sale listings.

The median new list price in December 2009 was $134,900. The median new list price was $14,600 less than from December 2008. Again, it’s evidence of the predominance of lower-priced foreclosure and short sale listings.

11) SHORT SALES: Short sales have had a bad reputation as offering false hope to sellers and creating frustration for buyers. They control 26% of the active listings and almost 56% of the properties under contract. Most short sale sellers have to wait 3-4 months before hearing a yes or no from their bank. However, for the first time ever, the percent of short sale listings that sold (19.78% in December 2009) was higher than the overall market (19.29%). 1,715 properties sold via short sale in December 2009 versus only 463 in December 2008 and only 61 in December 2007. The chart below compares short sale and all sale success rates.

Real Estate Statistics - January 4, 2010 update:

2009 Sales: Sales in the Phoenix metro area in 2009 hit 92,450, the 3rd highest sales year ever. December 2009’s sales of 7,750 was the 2nd highest December ever. So much for a depressed Phoenix market.

Bank-Owned Active Listings: There are 5,398 active bank-owned foreclosure listings in all of the Phoenix metro area, an increase of 38 over the past week as buyers stopped looking over New Years. Bank-owned properties only account for 16% of all active listings.

Pending sales (properties currently under contract): Currently, there are 9,596 pending sales in the Phoenix metro area plus an additional 5,749 contingency sales (shaky contracts). For comparison, the 9,596 pending sales on January 4, 2010 is higher than the highest # of pending sales at any day in 2006, 2007, or 2008! The total number of properties under contract today is 15,345, down 1,225 in the past week due to a lot of sales at the end of December.

Short sales: Currently 8,759 properties under contract are short sale listings, or 57% of the total market in the Phoenix area, a number that has risen every month. Because banks take 3-4 months to make a decision on short sale contracts, the properties under contract just hang in virtual suspension. Over 25% of all active listings are short sale properties.

Inventory: There are currently 33,361 active listings in MLS as of January 4, 2010. Inventory usually declines during the holiday season. Comparing to last year: January 14, 2009 had that highest number of active listings in 2009 at 52,685. Our inventory has dropped significantly while sales were up significantly.

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Let’s look at Phoenix, Arizona specifically.

For the city of Phoenix only, as of January 4, 2010. Numbers are based on the orange 90-day lines. However, check out the black lines (7-day trends). The Phoenix real estate market has shifted to a seller’s market.

Median sales price for Phoenix properties: $175,648 (down $884 in the past week). It is an odd occurrence. The 7-day trend does not look good (sharp decline). This time last year, the median sales price in Phoenix was $180,043, so we’re not that far off.

Inventory of properties for sale in Phoenix: 5,719, down only 3 in the past week. Phoenix is seeing a decrease while the rest of the metro area has an increase in inventory. See how the market supply has shrunk this year. Amazing. This time last year, there were 10,384 Phoenix properties for sale.

Median price per square foot for Phoenix properties: $96/sqft, no change in the past 3 weeks. This time last year, the median price per square foot was $106.

Real Estate Statistics - December 28, 2009 update:

Bank-Owned Active Listings: There are 5,360 active bank-owned foreclosure listings in all of the Phoenix metro area, an increase of 362 over the past 2 weeks as buyers slow down for the holidays. Bank-owned properties account for almost 16% of all active listings.

Pending sales (properties currently under contract): Currently, there are 10,478 pending sales in the Phoenix metro area plus an additional 6,091 contingency sales (shaky contracts). The total number of properties under contract today is 16,570, down 700 in the past 2 weeks.

More and more buyers are lured into making offers on short sale listings. Currently 9,438 properties under contract are short sale listings, or 57% of the total market in the Phoenix area, a number that continues to rise every month. Because banks take 3-4 months to make a decision on short sale contracts, the properties under contract just hang in virtual suspension. Over 25% of all active listings are short sale properties.

Inventory: There are currently 34,177 active listings in MLS as of December 28, 2009, up 207 in the past 2 weeks as buyers slow down for the holiday. Inventory usually declines during the holiday season. The increase came from foreclosure properties (are investors on vacation?) and short sale listings. We are still in a seller’s market in the under-$250,000 price range.

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Let’s look at Phoenix, Arizona specifically.

For the city of Phoenix only, as of December 28, 2009. Numbers are based on the orange 90-day lines. However, check out the black lines (7-day trends). The Phoenix real estate market has shifted to a seller’s market.

Median sales price for Phoenix properties: $176,532 (down $1,538 in the past 2 weeks). It is an odd occurrence. The 7-day trend does not look good (sharp decline).

Inventory of properties for sale in Phoenix: 5,722, down 34 in the past 2 weeks. Phoenix is seeing a decrease while the rest of the metro area has an increase in inventory. See how the market supply has shrunk this year. Amazing.

Median price per square foot for Phoenix properties: $96/sqft, down $1 in the past 2 weeks.

Phoenix Metropolitan Area Real Estate Statistics - November 2009

What is happening with the real estate market in the Phoenix metropolitan area? What changed in November 2009?

[click on the charts to expand]

1) SALES: November 2009’s sales of 7,494 were much better than November 2008’s 4,361 sales. That’s 72% more sales this November than last November! 2009 is shaping up to be the 3rd best year for sales in the past 10 years. 86.5% of the sales in November were homes, 12.1% were condos, and 1.4% were manufactured housing.

18.56% of the Phoenix metro area MLS listings sold in November 2009, down from October 2009 but more than double from November 2008 (which was a miserable 7.76%). 20.2% of the homes sold in November; 12.9% of the condos sold; 8.1% of manufactured homes sold. Bank-owned foreclosure properties accounted for 40.9% of the sales in November 2009 down from July 2009’s 53.4%. More and more buyers are purchasing homes from regular sellers. While 34% of the total sales in November 2009 were cash, 38% of the sales were with FHA or VA financing. This is the first time in at least 10 years that FHA/VA financing has been this high.

2) SALES PRICE: Prices have fluctuated in the past few months. The average sales price in November 2009 went up $4,400 to $174,523. It’s still 14% less than November 2008’s $204,121 average. The good news is that this percent difference (2009 vs. 2008) is decreasing.

The median sales price in November 2009 increased to $130,000. This was 13% less than the median sold price of $150,000 in November 2008. For buyers, Phoenix area homes continue to be very affordable. As a result, multiple offers are still common in the price range below $200,000. The Phoenix metropolitan area real estate market bottomed out in early April.

3) INVENTORY: Did the absorption rate go down (the # of months’ inventory available for sale)? The inventory of homes in November 2009 rose slightly to 5.4 months. It was much better than November 2008’s absorption rate of 12.9 months. A balanced buyer-seller market is six months. The absorption rate in November 2009: 4.9 months for homes (11 in 2008), 7.8 months for condos (26 in 2008), and 12.3 months for manufactured homes (32 in 2008). Therefore, it is now a seller’s market for homes in the Phoenix metropolitan area.

4) NEW MLS LISTINGS: In November 2009, the number of new listings was 10,889, which was down 12% from November 2008’s 12,402 new listings. The majority of the new listings were short sales. Usually at this time of year, inventory drops. However, in November, inventory increased to 40,372 active listings. The good news is that active listing inventory is down 28% from November 2008’s 56,227 listings.

5) AVERAGE DAYS ON MARKET: Phoenix area homes sold quicker this November at 68 days compared to 81 days in November 2008. However, condos are still taking longer to sell; 95 days in November 2009 which is the exact same as November 2008. With lower prices for homes thanks to foreclosure listings, buyers continue to select single-family residences instead of condos.

6) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in November 2009 was 97.14%, which was the 2nd best (October 2009 was the best) in over 3 years. It was better than November 2008’s 95.17% to the point that on the average sales price of $174,524, sellers kept almost $3,500 in their pockets compared to last year. This is due to home prices being so low and thus having little room for negotiating in a seller’s market and also due to a rush of buyers for the first time homebuyers tax credit. A normal market has sellers keeping 97.5% of their final list price.

7) PENDING SALES: Pending sales are a great indicator of future sales. Foreclosure listings are still selling fairly quickly which boosts the numbers of pending sales. The pending sales numbers were very strong in November 2009, reaching better levels than in all of 2008, 2007, and 2006. Pending sales in December are tracking historically strong but lower which is seasonally normal. The Phoenix real estate market activity is now performing higher than 2005 levels, except that prices are lower. In September, there were over 20,000 properties under contract (pending & contingency), an all-time record. We’re currently at the 17,300 mark. Short sales make up 55.5% of the properties under contract, which skews the numbers (looks good, but doesn’t count if they don’t convert to actual sales).

8 ) PRICE PER SQUARE FOOT: It rose to $91 per square foot in November 2009, which is historically low, but the best since January 2009. Multiple offers and declining inventory should have helped this statistic go up. Looks like March 2009 was the bottom of the market for price per square foot. The price per square foot a year ago was $103! Check out the chart!

9) VACANT HOMES: An unprecedented number of Phoenix metro area MLS active listings still are vacant. Sold homes have an even higher number of vacancies. Vacant properties accounted for 77.5% of all properties sold in November 2009, but it dropped off a hair as more buyers purchased occupied homes. This was the 9th month of decline. The normal is under 40%, however. The vacancy rate of sold properties in November 2008 was 83.1%.

10) ASKING PRICE VERSUS SOLD PRICE: Is there any difference between asking prices and sold prices? Yes. The average new list price in November 2009 was $244,400. This was $40,600 less than November 2008’s average new list price. Due to lower priced foreclosure listings and short sale listings.

The median new list price in November 2009 was $145,000. The median new list price was $24,000 less than from November 2008. Again, it’s evidence of the predominance of lower-priced foreclosure and short sale listings.

11) SHORT SALES: Short sales continue to stifle the Phoenix area real estate market. They control 24% of the active listings and 55.5% of the properties under contract. Sellers have been lulled into the false hope of short sales and buyer have been led to think the 4-month-long transaction will be worth it, especially when inventory dropped. There are currently 9,600 short sale listings under contract, up from 5,800 in May. This number continues to build because they are not converting to actual sales. What are the chances that the banks will accept all 9,600 offers? Not good. In fact, only about 17% of the pending short sale properties will successfully close escrow. The chart below compares short sale and all sale success rates. The success rate of short sales is over three times better than a year ago.

What will happen in upcoming months? December sales typically decline because of the holiday season. We predicted a sharp drop-off in sales in December & January, however the tax credit has been extended. Sales so far in December are remarkably strong. Banks are also holding back on foreclosure auctions.

Real Estate Statistics - December 14, 2009 update:

Bank-Owned Active Listings: There are 4,998 active bank-owned foreclosure listings in all of the Phoenix metro area, an increase of 274 over the past 2 weeks as buyers slow down for the holidays. There has been less than a one-month’s supply of foreclosure listings in the Phoenix metro area for the past 5 months. Bank-owned properties only account for almost 15% of all active listings.

Pending sales (properties currently under contract): Currently, there are 10,967 pending sales in the Phoenix metro area plus an additional 6,317 contingency sales (shaky contracts). The total number of properties under contract today is 17,284. This number has remained fairly steady for the past 3 months but is dropping slightly due to the holiday season.

More and more buyers are lured into making offers on short sale listings. Currently 9,592 properties under contract are short sale listings, or 55.5% of the total market in the Phoenix area. Because banks take 3-4 months to make a decision on short sale contracts, the properties under contract just hang in virtual suspension. Over 25% of all active listings are short sale properties.

Only 23% of all properties under contract are “normal” sales (non-short sale, non-bank owned).

Inventory: There are currently 33,970 active listings in MLS as of December 14, 2009, up 302 in the past 2 weeks as buyers slow down for the holiday. Inventory usually declines during the holiday season. The increase came from foreclosure properties; are investors on vacation? We are still in a seller’s market in the under-$250,000 price range.

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Let’s look at Phoenix, Arizona specifically.

For the city of Phoenix only, as of December 14, 2009. Numbers are based on the orange 90-day lines. However, check out the black lines (7-day trends). The Phoenix real estate market has shifted to a seller’s market.

Median sales price for Phoenix properties: $178,070 (down $1,147 in the past 2 weeks). It is an odd occurrence. The 7-day trend does not look good (sharp decline).

Inventory of properties for sale in Phoenix: 5,756, down 39 in the past 2 weeks. Phoenix is seeing a decrease while the rest of the metro area has an increase in inventory. See how the market supply has shrunk this year. Amazing.

Median price per square foot for Phoenix properties: $97/sqft, no change in the past 3 weeks.

Real Estate Statistics - November 30, 2009 update:

Bank-Owned Active Listings:  There are only 4,724 active bank-owned foreclosure listings in all of the Phoenix metro area, an increase of 17 over last week.  There has been less than a one-month’s supply of foreclosure listings in the Phoenix metro area for the past 5 months.  Bank-owned properties only account for 14% of all active listings.

Pending sales (properties currently under contract):  Currently, there are 11,449 pending sales in the Phoenix metro area plus an additional 6,318 contingency sales (shaky contracts).  The total number of properties under contract today is 17,767.  This number has remained fairly steady for the past 3 months but will likely drop due to the season.

More and more buyers are lured into making offers on short sale listings.  Currently 9,668 properties under contract are short sale listings, or 54.4% of the total market in the Phoenix area.  Because banks take 3-4 months to make a decision on short sale contracts, the properties under contract just hang in virtual suspension.  Over 25% of all active listings are short sale properties.

Only 23% of all properties under contract are “normal” sales (non-short sale, non-bank owned).

Inventory:  There are currently 33,668 active listings in MLS as of November 30, 2009, down 29 since last week.   Usually inventory declines during the holiday season.  We are still in a seller’s market in the under-$250,000 price range.

_______________________________________

Let’s look at Phoenix, Arizona specifically.

For the city of Phoenix only, as of November 30, 2009.  Numbers are based on the orange 90-day lines.  However, check out the black lines (7-day trends).  The Phoenix real estate market has shifted to a seller’s market.

Median sales price for Phoenix properties:  $179,217 (down $384 in the past week). It is an odd occurrence.  We should see a jump in prices in November as buyers scrambled to buy and qualify for the first-time home buyers’ tax credit that expires November 30.  The 7-day trend does not look good (sharp decline).

Inventory of properties for sale in Phoenix:  5,795, down 19 since last week.  Phoenix is seeing a decrease while the rest of the metro area has an increase in inventory.   See how the market supply has shrunk this year. Amazing.

Median price per square foot for Phoenix properties: $97/sqft, no change in the past week.

Real Estate Statistics - November 23, 2009 update:

Bank-Owned Active Listings: There are only 4,707 active bank-owned foreclosure listings in all of the Phoenix metro area, an increase of 100 over last week. There has been less than a one-month’s supply of foreclosure listings in the Phoenix metro area for the past 5 months. Bank-owned properties only account for 14% of all active listings.

Pending sales (properties currently under contract): Currently, there are 11,892 pending sales in the Phoenix metro area plus an additional 6,411 contingency sales (shaky contracts). The total number of properties under contract today is 18,303. This number has remained fairly steady for the past 3 months.

More and more buyers are lured into making offers on short sale listings. Currently 9,708 properties under contract are short sale listings, or 53% of the total market in the Phoenix area. This number grows every week because the listings are not converting to actual sales; it’s like being in limbo forever. Banks are taking 3-4 months to make a decision on short sale contracts and even then the percent that is actually approved is minimal. Over 25% of all active listings are short sale properties.

Inventory: Inventory has been climbing lately. There are currently 33,697 active listings in MLS as of November 23, 2009, up 367 since last week. Usually inventory declines during the holiday season. We are still in a seller’s market in the under-$250,000 price range.

_______________________________________

Let’s look at Phoenix, Arizona specifically.

For the city of Phoenix only, as of November 23, 2009. Numbers are based on the orange 90-day lines. However, check out the black lines (7-day trends). The Phoenix real estate market has shifted to a seller’s market.

Median sales price for Phoenix properties: $179,601 (down $77 in the past week). It is an odd occurrence. We should see a jump in prices in November as buyers scrambled to buy and qualify for the first-time homebuyers’ tax credit that expires November 30.

Inventory of properties for sale in Phoenix: 5,814, down only 16 since last week. Phoenix is seeing a decrease while the rest of the metro area has an increase in inventory. See how the market supply has shrunk this year. Amazing.

Median price per square foot for Phoenix properties: $97/sqft, down $1 in the past week.

4.83% fixed mortgage interest rate!!!  Unbelievable but true.  It’s a great time to buy.

Phoenix Metropolitan Area Real Estate Statistics - October 2009

What is happening with the real estate market in the Phoenix metropolitan area? What changed in October 2009?

[click on the charts to expand]

1) Did the number of sales go up? Compared to September 2009, no they did not. But October 2009’s sales of 8,121 were much better than October 2008’s 5,366 sales. That’s 51% more sales this October than last October! 2009 is shaping up to be the 3rd best year for sales in the past 10 years. 86.6% of the sales in October were homes, 12.0% were condos, and 1.4% were manufactured housing.

20.66% of the Phoenix metro area MLS listings sold in October 2009, up slightly from September 2009 but more than double from October 2008. 22.6% of the homes sold in October; 14.1% of the condos sold; 8.9% of manufactured homes sold. Bank-owned foreclosure properties accounted for 44.6% of the sales in October 2009 down from July 2009’s 53.4%. More and more buyers are purchasing homes from regular sellers. While 33% of the total sales in October 2009 were cash, 38% of the sales were with FHA or VA financing. This is the first time in at least 10 years that FHA/VA financing has been this high.

2) Did sales prices increase in the Phoenix market? No, they flattened. The average sales price in October 2009 was $170,086, almost $5,000 less than September 2009. And still 20% less than October 2008’s $211,924 average.

The median sales price in October 2009 decreased to $128,000. This was 22% less than the median sold price of $164,000 in October 2008. For buyers, Phoenix area homes continue to be very affordable. As a result, multiple offers are still common in the price range below $200,000. The Phoenix metropolitan area real estate market bottomed out in early April.

3) How was the inventory of homes in Phoenix? Did the absorption rate go down (the # of months’ inventory available for sale)? The inventory of homes in October 2009 was 4.84 months, almost exactly like September 2009. It was much better than October 2008’s absorption rate of 10.38 months and October 2007’s 15 months!. A balanced buyer-seller market is six months. The absorption rate in October 2009: 4.4 months for homes, 7.1 months for condos, and 11 months for manufactured homes. Therefore, it is now a seller’s market for homes in the Phoenix metropolitan area.

4) Did the number of new MLS listings decline, especially compared to same month previous year? Yes, they did. In October 2009, the number of new listings was 13,099, which was less than October 2008’s 14,602 new listings. The majority of the new listings were short sales. Usually at this time of year, inventory drops. However, in October, inventory increased to 39,312 active listings. And we’re seeing that trend continue through mid-November.

5) Did the average # of days on market decline? Yes and no, compared to last year and last month. Phoenix area homes sold quicker this October at 67 days compared to 73 days in October 2008 and was the lowest amount since August 2006. However, condos are still taking longer to sell; 97 days in October 2009 which is six days more than October 2008’s 93 days. With lower prices for homes thanks to foreclosure listings, buyers continue to select single-family residences instead of condos. But there was a increase in condo sales in October.

6) Are sellers keeping more money in their pockets? The percent of $$$ that sellers keep (sales price divided by list price) increased in October 2009 to 97.2%. This was better than October 2008’s 95.5% and the highest level since July 2006. This is due to home prices being so low and thus having little room for negotiating in a seller’s market and also due to a rush of buyers for the first time home buyers tax credit. Expect to see November’s figure to be even higher. A normal market has sellers keeping 97.5% of their final list price.

7) Pending sales are a great indicator of future sales. How are pending sales in the Phoenix area? Foreclosure listings are still selling fairly quickly which boosts the numbers of pending sales. The pending sales numbers were very strong in October 2009, reaching better levels than in all of 2008, 2007, and 2006. Pending sales in November are tracking historically strong but lower which is seasonally normal. The Phoenix real estate market activity is now performing higher than 2005 levels, except that prices are lower. In September, there were over 20,000 properties under contract (pending & contingency), an all-time record. We’re currently at the 18,600 mark. Short sales make up almost 52% of the properties under contract, which skews the numbers (looks good, but doesn’t count if they don’t convert to actual sales).

8 ) What about price per square foot? It remained steady at $89 per square foot in October 2009, which is historically low. Multiple offers and declining inventory should have helped this statistic go up. Looks like March 2009 was the bottom of the market for price per square foot. The price per square foot a year ago was $107! Check out the chart!

9) What about occupied homes and vacant homes? An unprecedented number of Phoenix metro area MLS active listings still are vacant. Sold homes have an even higher number of vacancies. Vacant properties accounted for 79% of all properties sold in October 2009, but it dropped off a hair as more buyers purchased occupied homes. This was the 8th month of decline. The normal is under 40%. The vacancy rate of sold properties in October 2008 was 80.6%.

10) Is there any difference between asking prices and sold prices? Yes. The average new list price in October 2009 was $250,054. This was $44,000 less than October 2008’s average new list price. Due to lower priced foreclosure listings and short sale listings.

The median new list price in October 2009 was $148,844. The median new list price was $26,000 less than from October 2008. Again, it’s evidence of the predominance of lower-priced foreclosure and short sale listings.

11) What about short sales in the Phoenix metro area? Short sales continue to stifle the Phoenix area real estate market. They control 24% of the active listings and 52% of the properties under contract. Sellers have been lulled into the false hope of short sales and buyer have been led to think the 4-month-long transaction will be worth it, especially when inventory dropped. There are currently over 9,660 short sale listings under contract, up from 5,800 in May. This number continues to build because they are not converting to actual sales. What are the chances that the banks will accept all 9,660 offers? Not good. In fact, only about 19% of the pending short sale properties will successfully close escrow. The chart below compares short sale and all sale success rates. However, the percentages are improving for short sales to the point that they are catching up to all sales. In fact, the success rate of short sales is nearly four times better than a year ago.

What will happen in upcoming months? November sales typically decline because of the holiday season. First-time homebuyers who thought the tax credit would expire November 30th will be responsible for a spike in November sales. We predicted a sharp drop-off in sales in December & January, however the tax credit has been extended. Banks are also holding back on foreclosure auctions.