Leif Swanson

Phoenix Metropolitan Area Real Estate Statistics - May 2010

What is happening with the real estate market in the Phoenix metropolitan area? What changed in May 2010?

[click on the charts to expand]

1) SALES: May 2010 had sales of 9,079, which was lower than May 2009’s 9,284 sales. 85% of the sales in May were homes, 14% were condos, and <2% were manufactured housing.
This was the third highest May sales month ever.

22% of the Phoenix metro area MLS listings sold in May. 23% of the home listings sold in May; 18% of the condos sold; 13% of manufactured homes sold.
Bank-owned foreclosure properties accounted for 38% of the sales in May 2010; a year ago, 63% of the sales were bank-owned.
37% of the total sales in May 2010 were cash. A year ago, it was 39%.
36% of the sales were with FHA or VA financing. A year ago, it was 32%.

2) SALES PRICE: The average sales price in May 2010 increased to $177,132. May 2010’s average sales price was higher than May 2009’s average by $13,600, an 8% gain. Sales prices are at levels seen in 2002.

The median sales price in May 2010 increased to $130,000. This was 8% higher than in May 2009, the third consecutive year-over-year increase since July 2006! The Phoenix metropolitan area real estate market bottomed out in early April 2009.

76% of the sales in May 2010 were below $200,000, 84% under $250,000, 89% under $300,000, and 92% under $350,000.

3) INVENTORY: The absorption rate (the # of months’ inventory available for sale) is also known as inventory. The absorption rate in May 2010 was 4.6 months. A balanced buyer-seller market is six months. The absorption rate in May 2010: 4.3 months for homes, 5.6 months for condos, and 7.9 months for manufactured homes. Therefore, it is a balanced market for homes in the Phoenix metropolitan area.

4) AVERAGE DAYS ON MARKET: Phoenix area homes sold a little quicker this May at 76 days. Condos took 86 days in May 2010 (107 days in May 2009).

5) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in May 2010 was 96.28%, which was better than May 2009’s 95.72%. A normal market has sellers keeping 97.5% of their final list price.

6) 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 May 2010, due to the first-time home buyers tax credit deadline. We are at 12,061 pending sales on June 17th as more and more of the tax credit sales close escrow. Pending sales usually peaks at the last week of a month; in June 2010, pending sales peaked on June 2nd. We expect the pending numbers to decline in the upcoming months. Pending sales reached an all-time high of 15,402 on April 29th. When you add in the contingency contracts, the current combined number of properties under contract on April 29th was 23,630, an all-time record. We can attribute this to the first-time home buyer tax credit deadline.

7) PRICE PER SQUARE FOOT: $91 per square foot in May 2010, but is $6 more than May 2009.

8 ) 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 75% of all properties sold in May. We are seeing a decline in vacant properties as more traditional sales (non-foreclosure) take place. The vacancy rate of sold properties in May 2009 was 85%! The normal is under 40%, however.

9) ASKING PRICE VERSUS SOLD PRICE: What is the difference between asking prices and sold prices? The average new list price in May 2010 was $220,860. This was $26,600 less than May 2009’s average new list price.

The median new list price in May 2010 was $136,000, which was $13,000 less than May 2009.

10) NEW MLS LISTINGS & INVENTORY: In May 2010, the number of new listings was 11,717. Inventory was 41,326 total listings for the entire month. Currently there are 33,675 active listings, up from last month due to the end of the first-time home buyer tax credit incentive.

11) SHORT SALES: 20% of all MLS sales in May 2010 were short sales. The success rate of a short sale listing actually selling was 21% in May 2010, better than May 2009’s 13% success rate & May 2008’s 3% rate. Short sales have had a bad reputation as offering false hope to sellers and creating frustration for buyers. Most short sale sellers have to wait 3-4 months before hearing a yes or no from their bank. However, we have seen improvements in short sales. The percent of short sale listings sold is approaching the same amount as the total listings sold. 1,855 properties sold via short sale in May 2010 versus only 999 in May 2009 and only 159 in May 2008. The chart below compares short sale and all sale success rates.

Two years ago, I helped my client John look for a home in north Phoenix.   I had seen a particular house that looked too ugly to show John.   I called it the ketchup and mustard house because of the ugly red and yellow paint.  I even featured it in a post on my uglyhousephotos blog on March 27, 2008 (see it here).  But after looking at many other ugly houses and not finding the right one, it was time to give the ketchup house a shot.   It was love at first ugly sight.  John bought the house.

John remodeled his “hot dog” home and turned it into sirloin steak.  He was featured in today’s Arizona Republic newspaper in an article recognizing do-it-yourself remodelers.  Congrats, John, for the recognition! [I'm also mentioned in the article.]

Let’s take a look at John’s awesome transformation.

The kitchen before:

John expanded the kitchen into the storage space (beyond the white doorway in the above photo).  Here is the beautiful kitchen today.

There are more photos of John’s incredible kitchen in the newspaper article’s slide show of three remodeled kitchens; John’s photos are slides 11-16.

Here’s John’s ketchup family room before.

Here’s John’s mustard living room before.  He removed that ugly shelf thing in the corner.

The point is that buyers (and agents) base their decision to see a home on the photos.  If the house and photos are not presented well to begin with, it could be a lost sale.   First impressions do matter.

Yes, there are buyers who can see beyond clutter, ugly paint, dirt, dust, grime, etc., but they are a small percent of buyers.  Why take a chance in turning off 80% of buyers?

Phoenix Metropolitan Area Real Estate Statistics - April 2010

What is happening with the real estate market in the Phoenix metropolitan area? What changed in April 2010?

[click on the charts to expand]

1) SALES: April 2010’s sales of 9,261 were higher than April 2009’s 8,564 sales. That’s 8% more sales this April than last April! 84% of the sales in April were homes, 14% were condos, and 2% were manufactured housing.
This was the second highest April sales month ever. April 2005 remains #1.

22.18% of the Phoenix metro area MLS listings sold in April, better than April 2009 (which was 19.39%). 23% of the home listings sold in April; 18% of the condos sold; 13% of manufactured homes sold.
Bank-owned foreclosure properties accounted for 38.5% of the sales in April 2010; a year ago, 65.3% of the sales were bank-owned.
39% of the total sales in April 2010 were cash, down from 42% last month.
34% of the sales were with FHA or VA financing.

2) SALES PRICE: The average sales price in April 2010 decreased to $171,301, as buyers rushed to purchase lower priced homes. April 2010’s average sales price was higher than April 2009’s average by $11,000, a 7% gain.

The median sales price in April 2010 stayed flat at $128,000. This was nearly 11% higher than in April 2009, the second consecutive year-over-year increase since July 2006! The Phoenix metropolitan area real estate market bottomed out in early April 2009.

76% of the sales in April 2010 were below $200,000, 84% under $250,000, 89% under $300,000, and 93% under $350,000.

3) INVENTORY: The absorption rate (the # of months’ inventory available for sale) is also known as inventory. The absorption rate in April 2010 decreased to 4.5 months. It was better than April 2009’s absorption rate of 5.2 months. A balanced buyer-seller market is six months. The absorption rate in April 2010: 4.3 months for homes, 5.6 months for condos, and 7.9 months for manufactured homes. Therefore, it is a balanced market for homes in the Phoenix metropolitan area.

4) AVERAGE DAYS ON MARKET: Phoenix area homes sold a little quicker this April at 78 days. Condos took 96 days in April 2010.

5) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in April 2010 was 96.26%, which was better than April 2009’s 95.07%. A normal market has sellers keeping 97.5% of their final list price.

6) 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 April 2010, reaching better levels than in all of 2008, 2007, 2006, and 2005. Pending sales reached an all-time high of 15,402 on April 29th. We are at 14,210 pending sales on May 20th. When you add in the contingency contracts, the current combined number of properties under contract on April 29th was 23,630, an all-time record. We can attribute this to the first time home buyer tax credit deadline.

7) PRICE PER SQUARE FOOT: $89 per square foot in April 2010, but is $5 more than April 2009.

8 ) 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 75% of all properties sold in April. The vacancy rate of sold properties in April 2009 was 86%! The normal is under 40%, however.

9) ASKING PRICE VERSUS SOLD PRICE: What is the difference between asking prices and sold prices? The average new list price in April 2010 was $210,141. This was $41,000 less than April 2009’s average new list price.

The median new list price in April 2010 was $138,000. The median new list price was $11,900 less than from April 2009.

10) NEW MLS LISTINGS: In April 2010, the number of new listings was 14,302. Inventory increased to 41,756 total listings for the entire month. Currently there are 32,120 active listings, about 2,000 less than last month. So despite an increase in new listings, the inventory actually dropped, because buyers are depleting inventory.

11) SHORT SALES: 21% of short sales listings sold in April 2010, 2.3 times better than April 2009’s 9% success rate. Short sales have had a bad reputation as offering false hope to sellers and creating frustration for buyers. Most short sale sellers have to wait 3-4 months before hearing a yes or no from their bank. However, we are still seeing a significant improvement in short sales. The percent of short sale listings sold is approaching the same amount as the total listings sold. 1,869 properties sold via short sale in April 2010 versus only 808 in April 2009 and only 146 in April 2008. The chart below compares short sale and all sale success rates.

I was quoted in yesterday’s Arizona Republic newspaper article on improving your home’s curb appeal (”10 Ways To Add Curb Appeal”). It’s a slide show with text.

From a post in March 2009, a front door coated in pigeon poop. Would you walk through this to go inside or run away?

Phoenix Metropolitan Area Real Estate Statistics - March 2010

What is happening with the real estate market in the Phoenix metropolitan area? What changed in March 2010?

[click on the charts to expand]

1) SALES: March 2010’s sales of 8,969 were much better than March 2009’s 7,636 sales and even better than March 2008’s 4,303 sales. That’s 17% more sales this March than last March! 84% of the sales in March were homes, 14% were condos, and 2% were manufactured housing.

This was the second highest March sales month ever. March 2005 remains #1.

20.98% of the Phoenix metro area MLS listings sold in March, much better than March 2009 (which was 15.35%); March 2008 was 7.54%! 22% of the home listings sold in March; 17% of the condos sold; 14% of manufactured homes sold. Bank-owned foreclosure properties accounted for 40.1% of the sales in March 2010; a year ago, 66.5% of the sales were bank-owned.

42% of the total sales in March 2010 were cash. 32% of the sales were with FHA or VA financing.

2) SALES PRICE: The average sales price in March 2010 increased by $4,300 to $178,186. This is the highest average sales price since January 2009. Even better news is that March 2010’s average sales price was higher than March 2009’s average by $19,000, a 12% gain.

The median sales price in March 2010 increased by $3,000 to $128,000. This was nearly 11% higher than in March 2009, the first year-over-year increase since July 2006! The Phoenix metropolitan area real estate market bottomed out in early April 2009.

75% of the sales in March 2010 were below $200,000, 84% under $250,000, 92% under $350,000, and 96% under $500,000.

3) INVENTORY: The absorption rate (the # of months’ inventory available for sale) is also known as inventory. The absorption rate in March 2010 decreased to 4.8 months. It was much better than March 2009’s absorption rate of 6.5 months and almost a third that of February 2008 (12.7 months). A balanced buyer-seller market is six months. The absorption rate in March 2010: 4.5 months for homes, 6.0 months for condos, and 7.3 months for manufactured homes. Therefore, it is a balanced market for homes in the Phoenix metropolitan area.

4) NEW MLS LISTINGS: In March 2010, the number of new listings was 14,614, which was slightly higher than March 2009’s 14,242 new listings. Inventory increased to 42,755 total listings for the entire month. Currently there are 34,300 active listings, about 1,000 less than last month. So despite an increase in new listings, the inventory actually dropped, because buyers are depleting inventory.

5) AVERAGE DAYS ON MARKET: Phoenix area homes took a little longer to sell this March at 82 days. Condos took 93 days in March 2010.

6) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in March 2010 was 96.19%, which was better than March 2009’s 94.54%. 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 March 2010, reaching better levels than in all of 2008, 2007, and 2006. Pending sales in April are tracking even stronger with an all-time high of 14,602 on April 15th. When you add in the contingency contracts, the current combined number of properties under contract on April 15th was 22,565, an all-time record.

8 ) PRICE PER SQUARE FOOT: $92 per square foot in March 2010, but is $9 more than March 2009, which was the bottom of the market for price per square foot. 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 76.2% of all properties sold in March. The vacancy rate of sold properties in March 2009 was 87%! The normal is under 40%, however.

10) ASKING PRICE VERSUS SOLD PRICE: Is there any difference between asking prices and sold prices? Yes. The average new list price in March 2010 was $217,559. This was $30,000 less than March 2009’s average new list price.

The median new list price in March 2010 was $139,000. The median new list price was $3,700 less than from March 2009.

11) SHORT SALES: 19% of short sales listings sold in March 2010, three times better than March 2009’s 7% success rate (and much better than March 2008’s dismal 2.6% success rate). 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 52% 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, we are still seeing a significant improvement in short sales. The percent of short sale listings sold is approaching the same amount as the total listings sold. 1,737 properties sold via short sale in March 2010 versus only 728 in March 2009 and only 117 in March 2008. The chart below compares short sale and all sale success rates.

With bank-owned homes, the seller (the bank) does not provide any disclosure or history about the house. And they do not repair any issues; it is sold in “as is” condition. Thus the burden is on the buyer to discover any weaknesses.

My client recently beat out 13 other buyers on a 1959 foreclosure house in Phoenix. The house itself looked to be in great shape, but the home inspection told a different story.

Cracked truss in the attic.

The wiring in the attic is a mess. Someone spliced in extra wiring into the romex wiring and wrapped it in tape.

Another view. Exposed wires sitting on wood. Examples like this were found throughout the attic. If you were a landlord and didn’t fix this (or know about it) and there was a fire, how do you think your tenants would react? L-a-w-s-u-i-t.

A cable wire just ends for no reason.

So that’s why there was no exhaust hood over the stove in the kitchen.

The insulation in this attic maxed out at about 1/2 inch. Probably gives this house an R-minus10 rating.

The wood shake shingle roof looked fine from the outside, but from the attic it looked like Swiss cheese. Sun poured in at at least twenty spots. Here’s a gap under an attic vent, big enough for a golf ball (or rat) to pass through.

The main electric panel (from 1959) did not have a main shut-off; in an electric emergency, you’d have to switch off 7 breakers. This might have been code back then, so can we really complain? Well, let’s take a look at the two subpanels. The main panel feeds into the subpanel on the right but bypasses it to the one on the left then feeds back to the one on the right. Follow that? Note that the left subpanel has a thick white grounding wire but the right subpanel is missing that wire (red circle). Hmmm.

$2500 for a new electric panel, at least $1000 for rewiring in the attic, $4000 for a new roof, $2000 for pool replastering, at least $500 for attic insulation. That’s $10,000 right there. The buyer cancelled the contract.

Photos courtesy of Brian Quisberg, Inspector/Owner of Desert Estates Home Inspections.

Phoenix Metropolitan Area Real Estate Statistics - February 2010

What is happening with the real estate market in the Phoenix metropolitan area? What changed in February 2010?

[click on the charts to expand]

1) SALES: February 2010’s sales of 6,595 were much better than February 2009’s 5,477 sales and even better than February 2008’s 3,445 sales. That’s 20% more sales this February than last February! 84.1% of the sales in February were homes, 13.8% were condos, and 2.1% were manufactured housing.

This was the second highest February sales month ever. February 2005 remains #1.

15.56% of the Phoenix metro area MLS listings sold in February, much better than February 2009 (which was a weak 10.53%); February 2008 was 6%! 16% of the home listings sold in February; 12% of the condos sold; 11% of manufactured homes sold. Bank-owned foreclosure properties accounted for 41.1% of the sales in February 2010; a year ago, 66% of the sales were bank-owned.

45% of the total sales in February 2010 were cash. 29% of the sales were with FHA or VA financing.

2) SALES PRICE: The average sales price in February 2010 dropped $1,840 to $173,870. However, the good news is that February 2010’s average sales price was higher than February 2009’s average by $1,500.

The median sales price in February 2010 increased by $100 to $125,000. This was the same median sold price as February 2009. The Phoenix metropolitan area real estate market bottomed out in early April 2009. We’ve seen some wavering in prices since then.

77% of the sales in February 2010 were below $200,000, 84% under $250,000, 92% under $350,000, and 96% under $500,000.

3) INVENTORY: The absorption rate (the # of months’ inventory available for sale) is also known as inventory. The absorption rate in February 2010 decreased to 6.4 months. It was much better than February 2009’s absorption rate of 9.5 months and half that of February 2008 (14 months). A balanced buyer-seller market is six months. The absorption rate in February 2010: 6.1 months for homes, 8.2 months for condos, and 9.4 months for manufactured homes. Therefore, it is a balanced market for homes in the Phoenix metropolitan area.

4) NEW MLS LISTINGS: In February 2010, the number of new listings was 12,831, which was slightly higher than February 2009’s 12,661 new listings. Inventory increased to 42,388 total listings. Currently there are 35,200 active listings, about 16,000 less than last year.

5) AVERAGE DAYS ON MARKET: Phoenix area homes took a little longer to sell this February at 80 days. Condos took 93 days in February 2010.

6) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in February 2010 was 95.45%, which was better than February 2009’s 94.5%. 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 February 2010, reaching better levels than in all of 2008, 2007, and 2006. Pending sales in March are tracking very strong at 13,465. When you add in the contingency contracts, the current combined number of properties under contract on March 15th was 20,903, an all-time record.

8 ) PRICE PER SQUARE FOOT: It dropped by $1 to $90 per square foot in February 2010, but is $1 more than February 2009. March 2009 was the bottom of the market for price per square foot. 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 76.8% of all properties sold in February. The vacancy rate of sold properties in February 2009 was 88%! The normal is under 40%, however.

10) ASKING PRICE VERSUS SOLD PRICE: Is there any difference between asking prices and sold prices? Yes. The average new list price in February 2010 was $221,551. This was $50,000 less than February 2009’s average new list price.

The median new list price in February 2010 was $139,900. The median new list price was $15,100 less than from February 2009. It’s evidence of the predominance of lower-priced foreclosure and short sale listings.

11) SHORT SALES: 15% of short sales listings sold in February 2010, three times better than February 2009’s 4.7% success rate (and much better than February 2008’s dismal 1.4% success rate). 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 52% 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, we are seeing a significant improvement in short sales. The percent of short sale listings sold is approaching the same amount as the total listings sold. 1,428 properties sold via short sale in February 2010 versus only 492 in February 2009 and only 59 in February 2008. The chart below compares short sale and all sale success rates.

Phoenix Metropolitan Area Real Estate Statistics - January 2010

What is happening with the real estate market in the Phoenix metropolitan area? What changed in January 2010?

[click on the charts to expand]

1) SALES: January 2010’s sales of 5,789 were much better than January 2009’s 4,736 sales and even better than January 2008’s 2,907 sales. That’s 22% more sales this January than last January! 85.6% of the sales in January were homes, 12.5% were condos, and 1.9% were manufactured housing.

This was the second highest January sales month ever. January 2005 remains #1.

13.95% of the Phoenix metro area MLS listings sold in January, much better than January 2009 (which was a weak 8.84%); January 2008 was 5%! 15% of the home listings sold in January; 10% of the condos sold; 9% of manufactured homes sold. Bank-owned foreclosure properties accounted for 43.2% of the sales in January 2010, the same as last month; a year ago, 65% of the sales were bank-owned.

43% of the total sales in January 2010 were cash. 31% of the sales were with FHA or VA financing.

2) SALES PRICE: The average sales price in January 2010 dropped $1,762 to $175,710. It’s still 8% less than January 2009’s $180,383 average. The good news is that this percent difference (2010 vs. 2009) is decreasing. We should see a positive percentage showing up by April 2010.

The median sales price in January 2010 decreased to $124,900. This was 6.6% less than the median sold price of $130,000 in January 2009. The number of cash buyers stayed high in January, 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.

77% of the sales in January 2010 were below $200,000, 84% 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 January 2010 increased to 7.2 months. It was much better than January 2009’s absorption rate of 11 months and half that of January 2008 (15 months). A balanced buyer-seller market is six months. The absorption rate in January 2010: 6.7 months for homes, 10 months for condos, and 11.5 months for manufactured homes. Therefore, it is a balanced market for homes in the Phoenix metropolitan area.

4) NEW MLS LISTINGS: In January 2010, the number of new listings was 13,148, which was slightly less than January 2009’s 13,756 new listings. Inventory increased to 41,506 active listings, normal for new year as sellers wait until the holiday season is over before selling. Currently there are 35,400 active listings, about 16,000 less than last year.

5) AVERAGE DAYS ON MARKET: Phoenix area homes took a little longer to sell this January at 74 days. Condos took 94 days in January 2010.

6) SALES PRICE VERSUS LIST PRICE: The percent of $$$ that sellers keep (sales price divided by list price) in January 2010 was 95.5%, which was better than January 2009’s 94%. 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 January 2010, reaching better levels than in all of 2008, 2007, and 2006. Pending sales in February are tracking very strong at 12,350 (better than 9,968 a year ago this time). When you add in the contingency contracts, the current combined number of properties under contract is 19,036. We are tracking very close to September 2009 when we had a record number of over 20,000 properties under contract (pending & contingency). Short sales make up 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 ) PRICE PER SQUARE FOOT: It dropped by $1 to $91 per square foot in January 2010, which is $2 less than January 2009. March 2009 was the bottom of the market for price per square foot. 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 77.6% of all properties sold in January, a slight uptick ending ten months of decline. The normal is under 40%, however. The vacancy rate of sold properties in January 2009 was 87%!

10) ASKING PRICE VERSUS SOLD PRICE: Is there any difference between asking prices and sold prices? Yes. The average new list price in January 2010 was $239,599. This was $67,400 less than January 2009’s average new list price.

The median new list price in January 2010 was $145,000. The median new list price was $25,000 less than from January 2009. Again, it’s evidence of the predominance of lower-priced foreclosure and short sale listings.

11) SHORT SALES: Almost 14% of short sales listings sold in January 2010, three times better than January 2009’s 4.4% success rate. 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 52% of the properties under contract. Most short sale sellers have to wait 3-4 months before hearing a yes or no from their bank. 1,256 properties sold via short sale in January 2010 versus only 442 in January 2009 and only 54 in January 2008. The chart below compares short sale and all sale success rates.

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.