Courtesy of Barb Savoy-Pacella ~ Keller Williams Arizona Realty

Sometimes I feel like the Phoenix housing market is the “little engine that could.”  The Phoenix market is marching along toward recovery, inventory is continuing to decline, and foreclosure inventory is still
declining significantly.

For thirteen months in a row, Phoenix has seen a decline in notices of foreclosure.  A notice of foreclosure is issued when a borrower has stopped making their payments, and the notice gives them 90 days
to become current on payments before the lender forecloses.  The all time high for notices in Maricopa
County was in December of 2009 when 47,606 notices were issued.  In December of 2011, 18,347 notices were
issued.  That may sound like a lot, however that is a 62% decrease in notices of foreclosure.

We are continuing to see slight price increases in the Phoenix market.  The bottom of the median price range was $107,000 eleven months ago in February of 2011.  We saw the median price rise to $115,000 in December, and it has seen another gain, with the current median price at $118,000.

RL Brown has been one of the leading forecasters in the Phoenix housing market since the mid 1960s.
I recall sitting in his annual forecast event in January of 2008, when everyone involved in housing was hoping that market decline taking place would be a typical twelve to twenty-four month event.  When RL Brown stated that he was forecasting signs of recovery for the Phoenix market in the third to fourth quarter of 2011, I was hoping that he was experiencing temporary insanity.  Clearly the guy knows something because he was spot on. Phoenix has now been declared #4 out of the Top 10 cities “for positive house price change in 2012.”

Listings Pending Sale are up with a total of 10,701. That is an increase of 613 pending sales when compared to last week. Listings that are active with contingencies (short sales with an executed contract that are awaiting approval from the lender) account for an additional 7,154 properties.

Current Conditions in the Phoenix Market:

• Inventory is continuing to melt. There are 14,300 single family detached listings, currently active in MLS, a decrease of 245 listings compared to last week.
• There are 18,239 total listings currently active in MLS, which includes condos, patio homes, townhomes, and lofts.

For additional information, and to view homes for sale, visit www.PacellaGroup.com

Courtesy of Barb Savoy-Pacella, ABR, CHMS,

KellerWilliams Arizona Realty

My obsession with foreclosure inventory, or lack thereof in the Phoenix real estate market, and its effect on pricing continues to consume me!

There are currently 97 HUD owned homes actively being listed in the Phoenix MLS.  That is a 91% decrease from 1,114 at this time last year!  Notices of Trustee sale (foreclosure) are down 59% from the same time period in 2011.

As we have established previously, 5.5 months of supply is considered to be a balanced market with
supply above 5.5 indicating a buyer’s market, and supply below 5.5 indicating a seller’s market.  Currently, Phoenix has a 3.6 month supply of inventory Valley wide, which includes homes that are short sales under contract, but waiting on lender approval. 

I have mentioned many times those dark days of late 2007 and early 2008 when I would hold my breath before looking at inventory, which was approximately 56,000 active listings, and absorption, which was under 5%.  Today, Phoenix inventory is 18,562 active listings, with a 54% absorption rate, meaning that half of the houses on the market are selling each month.

The last time that we have seen overall inventory this low in Phoenix was in October of 2005.  Do we all remember what was happening in October of 2005?  It’s happening again, right now.  Most homes that are in good condition and locations are receiving multiple offers, if they are priced appropriately. Our buyer clients are always shocked to discover this during the consultations because the media is not broadcasting the information.  It’s the best kept secret in town!

As a result, the median home price in Phoenix is currently $117,000 an increase of $7,000 from the same time period last year.  We do have our neighbors to thank for much of our progress.  Out of state purchasers has risen to 25% with Californians leading the way, followed by Canadians.

Listings Pending Sale are up with a total of  10,088. That is an increase of 532 pending sales when compared to last week. Listings that are active with contingencies (short sales with an executed contract that
are awaiting approval from the lender) account for an additional 6,952 properties.

Current Conditions in the Phoenix Market:

• Inventory is continuing to melt. There are 14,545      single family detached listings, currently active in MLS, which is essentially no change from last week.

There are 18,562 total listings currently active in MLS, which includes condos, patio homes, townhomes, and lofts.

For additional information, and to view homes for sale, visit www.PacellaGroup.com

Courtesy of Barb  Savoy-Pacella, ABR, CHMS ~Keller Williams Arizona Realty

www.PacellaGroup.com

We are definitely kicking off 2012 with a bang!

We typically think of December as a slow month for closings, and January as a slow month for pending sales, but think again! In the Pheonix metro area, December of 2011 had 8,107 closings, which is up over 16% from November 2011 closings.  Additionally, we have nearly 10,000 properties pending sale, and almost 7,000 short sales that are under contract and awaiting lender approval.  Giddy up!

As we’ve already established, I am obsessed with the sudden and steep decline in foreclosure inventory in Phoenix.  For years, we saw that foreclosures not only made up a large percentage of the active inventory, but they made up an even larger percentage of the homes that were actually selling.  In the month of December, of the approximately 8,000 homes that sold in Phoenix, only about 2,000 of them were foreclosures, which is the lowest percentage since May of 2008. 

Inventory, (or supply) in general is continuing to decline.  Inventory in the Phoenix metro area came down 7% in December, and is down 42% from the same time period, last year.  The decline in supply, and decline in foreclosure inventory is finally beginning to create an increase in pricing.  On average, throughout the Valley, and in all price ranges, the average price per square foot rose 5.7% from September 15^th through December 31^st. 

It seems that the media likes to focus on the negative, so we will probably hear quite a bit in the next few weeks about the 11% increase in foreclosures in December, as compared to November,
which was a result of a group of old Countrywide loans the borrowers of whom were noticed en-masse in August, and foreclosed in December.  Unfortunately, what the media will be unlikely to report is the 15% drop in new notices, which is the lowest in Maricopa County since November of 2007.

In summary, if you would like to share the good news with your friends and neighbors about the Phoenix market:

• Decemberof 2011 was an extremely strong month for sale, and based on the pending sales, January of 2012 should be extremely strong, as well.
• The percentage of foreclosure inventory continues to decline, and the percentage of foreclosure sales is the lowest since May of 2008.
• Inventory is continuing to decline, and prices are increasing.
• New notices of foreclosure are at their lowest point since November of 2007.

Listings Pending Sale are down slightly at 9,556. That is a decrease of 350 pending sales when compared to last week, and again, although it is a decrease from the previous week, seasonally, it is extremely strong. Listings that are active with contingencies account for an additional 6,735 properties.

Current Conditions in the Phoenix Market:

• Inventory is continuing to melt. There are 14,539 single family detached listings, currently active in MLS. That is a decrease of 102 listings over the past week. We never did see the typical, seasonal inventory swell that usually begins in mid September to early October, and continues through the end of the year.
• There are 18,534 total listings currently active in MLS, which includes condos, patio homes, townhomes, and lofts.

For additional information, and to view homes for sale, visit www.PacellaGroup.com

Courtesy of Barb Savoy-Pacella, ABR, CHMS ~ Keller Williams Arizona Realty

www.PacellaGroup.com

We’ve come a long way, baby!

By now you know that I am a data geek/junkie. It shouldn’t surprise me to discover that the data geek in me saved a market snap shot dated August 17, 2007, the very week that the mortgage meltdown occurred.  On that date, Phoenix had 56,205 active listings in MLS inventory, only 4,687 pending listings, and a 12.3 months supply of inventory. I certainly recall the frustration of making phone calls to inform sellers that their pending listings were falling out of escrow because the buyer’s lender had closed their doors, and the buyer was not able to obtain other financing, and of course what in subsequent months felt like paralysis of the market, as absorption dropped below 5%.

Today, we have 18,773 active listings in MLS inventory, which is a 66% improvement, there are almost
10,000 pending listings, our supply is just 3.5 months, and absorption is 48%. Hallelujah!

In the time since 2007, our market snapshots have added the bonus feature of tracking foreclosure and short sale inventory (unnecessary prior to 2007).  Valley wide, foreclosure inventory is down to 9%, and short sale inventory is hovering
at 36% (it has bounced between 36-39% for the past two years).

Listings Pending Sale are down slightly at 9,906. That is a decrease of 535 pending sales when compared to two weeks ago, and very typical for this time of year. Listings that are active with contingencies account for an additional 6,891 properties.

Current Conditions in the Phoenix Market:

• Inventory is continuing to melt.  There are 14,641 single family detached      listings, currently active in MLS. That is a decrease of 532 listings over the past two weeks. We have been watching for the typical, seasonal inventory swell that usually begins in mid September to early October, and we have not seen it yet.
• There are 18,773 total listings currently active in MLS, which includes condos, patio homes, townhomes, and lofts.

For additional information, and to view homes for sale, visit www.PacellaGroup.com

Courtesy of Barb Savoy-Pacella, ABR, CHMS, CEO ~ Keller Williams Arizona Realty

www.PacellaGroup.com

The Cromford Report, which analyzes MLS data and trends in Maricopa County, is making some BOLD  predictions, fueled by continued positive indicators in the market data.

To begin, sales for the month of November were up 8% over the same time period last year; additionally, active listings are down 41%. The listing success rate (the number of homes that come on to the market and actually sell, rather than resulting in an expired listing) has increased 15% over last year.

The big news continues to be in foreclosure inventory (or lack thereof ), equity listing inventory, and pricing.  The shift in inventory is finally equating to a shift in pricing.  As we have observed over the last 120 days, foreclosure inventory has been on a sharp decline.  The good news is that the declining foreclosure inventory has made way for an increase in equity sale inventory, which of the three segments of market inventory (foreclosure, short  sale, or equity sale), has the greatest strength in pricing.  The  overall result is an increase in the average price per square foot.

The overall, average price per square foot valley wide has increased 6.5% in the 91 days between September 1^, 2011 and November 30, 2011.  Additionally, the month over month increase from October to November was 3.1%.

The two cities showing the greatest price per square foot increase over the past year are Fountain Hills at 14.8% and Paradise Valley at 11.9% (sort of shatters the myth that the luxury market is
struggling).

The two cities showing the least gain in price per square foot over the past year are Sun Lakes at -14.3%, which is surprising, since typically the 55 and over communities weather market trends with less distress; and Litchfield Park at -8.5%.

Listings Pending Sale are up again this week at 10,441. That is an increase of 244 pending sales when compared to last week, and unusual for our typical seasonal market. Listings that are active with contingencies account for an additional 7,345 properties.

Current Conditions in the Phoenix Market:

• There are 15,173 single family detached listings,  currently active in MLS. That is a decrease of 9 listings over the past  week.  We have been watching for the typical, seasonal inventory swell that usually begins in mid September to early October, and we have not seen it yet.
• There are 19,395 total listings currently active in  MLS, which includes condos, patio homes, townhomes, and lofts.

For additional information, or to view homes for sale, please visit our web site at www.PacellaGroup.com

Courtesy of Barb Savoy-Pacella, ABR, CHMS, CEO ~Keller Williams Arizona Realty

Once again, we have more reasons for optimism in the Phoenix metro area market.

As we have been observing over the past several weeks, active inventory (homes currently listed for sale) is down 50% from the same time period last year. Additionally, foreclosure inventory has declined dramatically, and the number of sales for 2011 are up 22% over 2009 and 2010.  A 50% reduction in inventory, particularly foreclosure inventory, and a 22% increase in sales is certainly positive for our market.

As you may have noticed, I am currently obsessed with how dramatically the foreclosure inventory has adjusted.  For the past several years, foreclosures have accounted for a very large percentage of the inventory, and even up to 90 days
ago, foreclosures represented approximately 30% of the inventory in most areas in the Phoenix metro area. Currently, the percentage of active foreclosure inventory is in the single digits in most metro area cities.  After doing some homework, I have discovered that the mortgage delinquency rate in Arizona is down 32%, which is the greatest decline nationally…  If we’re going to be #1 at something, the greatest reduction in mortgage delinquency rates is fantastic with me!

Another interesting observation compares data from February of 2010 to August of 2011. In February
of 2010, Arizona was #3 in the nation for delinquent mortgages, and #4 in the nation for foreclosures.  In August
of 2011, Arizona was #24 in the nation for delinquent mortgages, and #18 nationally for foreclosures.  I am more than happy to relinquish the #3 and #4 positions when it comes to foreclosure data!

Listings Pending Sale are down this week at 10,197. That is a decrease of 384 pending sales compared to two weeks ago, which is typical seasonally.   Listings that are active with contingencies account for an additional 7,276 properties.

Current Conditions in the Phoenix Market:

• There are 15,164      single family detached listings, currently active in MLS. That is a decrease of 379 listings over the last two weeks.
• There are 19,388 total listings currently active in MLS, which includes condos, patio homes, townhomes, and lofts.

There is a lot of activity in the market.  Let us know how we can assist you with your real estate needs!

Courtesy of Barb Savoy-Pacella, ABR, CHMS, CEO ~ Keller
Williams Arizona Realty

www.PacellaGroup.com

Not only am I not holding my breath, or peeking between
my fingers as though watching a horror film this week, I actually just gathered
my team and did the “Snoopy Dance” in the hallway!  We are
really gaining momentum on improvement in the Phoenix Metro area real estate
market!

Over
the past 30 days, the average price per square foot across the metro area has
increased by 1.7%, which is a great step in the right
direction!  The current sales pending price per square foot is
showing a 3% increase over the pending price per square foot in October,
which should mean more great news regarding pricing next month. Additionally,
when we dissect the three major segments of the market, traditional equity
sales; short sales; and foreclosures, traditional
equity sales have gained some ground in the mix!

What I am most excited about today is what is happening
with short sale pricing.  Last month, we
had observed that although foreclosure and equity sale pricing was beginning to
increase, short sale pricing was continuing to decline.  Not this month!  The increase is slight, but it’s an increase,
none the less, and I am celebrating!  All three segments of the market are
continuing to see slight pricing increases.  Hallelujah!

Supply
is still remarkably low.
As we know, a 5.5 month supply of inventory is considered a balanced
market.  The valley overall has a 3.5 month supply, at this time,  which varies by location and price range, and
with the exception of some of the luxury segments of the market, most locations
and price ranges are under 5.5 months .
Buyers in the price ranges under $400,000 are often competing with
multiple offers for homes that are in good condition and good locations.

Listings Pending Sale are down slightly this
week, which is seasonally anticipated at 10,985 That is a decrease of 456
pending sales compared to last week. Listings that are active with
contingencies account for an additional 7,689 properties.

Current Conditions in the Phoenix
Market:

• There are 15,465 single family detached listings,
  currently active in MLS. That is an
  increase of 125 listings over last week, which is typical for our
  market, seasonally.
• There are 19,712 total listings currently active in
  MLS, which includes condos, patio homes, townhomes, and lofts.

For additional information, and to view homes for sale,
visit us at www.PacellaGroup.com

Courtesy of Barb Savoy-Pacella, ABR, CHMS, CEO ~ Keller Williams Arizona Realty

It never ceases to amaze me how quickly things within the Phoenix metro area real estate market can shift.

Approximately  90 days ago, we began observing a shift in the inventory mix in the Phoenix metro area.  We began seeing far fewer foreclosures coming into the inventory and an increase in short sales.

Just 90 days later, the inventory shift has become fairly dramatic.  For the past two years, the overall inventory mix has been roughly 1/3 foreclosure, 1/3 short sale, and 1/3 equity sales.  Today, foreclosures are representing a much smaller percentage of the pie, and we are noticing that in general, there seems to be an increase in short sale approvals.

Another interesting observation is that although pricing in the Phoenix market defied the laws of supply and demand for most of 2011, in regard to the shift in the inventory mix, it seems that we have decided to conform!  As the foreclosure inventory is decreasing, the average price per square foot for foreclosed homes increasing, and as the inventory of short sales is increasing, the average price per square foot is decreasing.   

Below is a chart with the percentage of foreclosures, short sales and equity listings currently as active inventory by city:

Half of the cities are in single digits when calculating the percentage of active foreclosure inventory, and the remainder are in the low teens.  The Northeast Valley cities of Fountain Hills, Scottsdale, and Paradise Valley, that were least impacted by distress overall during the past few years, are now showing very strong percentages of equity sales, all over 70%.

 The data also indicates that buyers are still looking for bargains.  Since Paradise Valley has the smallest percentage of foreclosure inventory, we will use it as our example.  Although the percentage of active foreclosure inventory in PV is only 2%, the percentage of foreclosure properties sold represents 26%.

Listings Pending Sale are up this week at 10,581. That is an increase of 270 pending sales compared to last week, which is a nice surprise considering that we typically observe a decline at this time of year.   Listings that are active with contingencies account for an additional 7,670 properties.

Current Conditions in the Phoenix Market:

• There are 15,543 single family detached listings, currently active
  in MLS. That is a slight increase of 12 listings over last week.
• There are 19,782 total listings currently active in MLS, which
  includes condos, patio homes, townhomes, and lofts.

For additional information, and to view homes for sale, visit us at www.PacellaGroup.com

Courtesy of Barb Savoy-Pacella, ABR, CHMS, CEO ~ Keller Williams Arizona Realty

www.PacellaGroup.com

Wow!  If you know me, then you know that I’m rarely speechless.  In reviewing the data today, not only am I NOT holding my breath, I’m so excited that I’m not sure where to begin!

As we have known for the past several weeks, inventory has dropped by 50% from this same time period last year.  Additionally, sales for the month of October 2011 were up 16% over October of 2010, and the listing success rate (the percentage of homes that sell, rather than the listing expiring or canceling) has increased 25% from October of 2010 to October of 2011.

Perhaps even more exciting is the chart found on the Cromford Report that shows the average price per square foot of homes by price range comparing pricing from October of 2010 to October of 2011.  It’s not the year over year pricing that fascinates me.  It’s the column that shows the date of the lowest price per square foot for a given price range, and the percentage of increase from that date to now.

Many of the lower price ranges, below $250,000 experienced their low in late 2010 and early 2011, however, in the $300,000 to $350,000 price range, the month when the lowest average price per square foot occurred was in February of 2009 (nearly three years ago).  The percentage of increase since then is almost 12%.  Even more surprising to me is that the higher price ranges experienced their lows in mid 2009 and mid 2010.  The $600,000 to $800,000 price range experienced it’s low in August of 2010 and is up 7.2% since then.  Check this out, the $2,000,000 to $3,000,000 price range experienced it’s low in July of 2010 and is up 13%, and $3,000,000 and above had their low in October of 2010 and is up 11%!

Historically, when the shift between supply and demand is experienced, it takes 12 to 18 months for prices to begin to increase.  We are several months into our imbalance, so we will continue to observe the market indicators for hopeful corrections.

Listings Pending Sale are down this week at 10,581. That is a decrease of 755 pending sales compared to last week, which is seasonally expected for our market.   Listings that are active with contingencies account for an additional 7,541 properties.

Current Conditions in the Phoenix Market:

• There are 15,555 single family detached listings, currently active
  in MLS. That is a slight increase of 8 listings over last week.
• There are 19,752 total listings currently active in MLS, which
  includes condos, patio homes, townhomes, and lofts.

For additional information, or to view homes for sale, visit our web site at www.PacellaGroup.com

Courtesy of Barb Savoy-Pacella, ABR, CHMS, CEO ~ Keller WilliamsArizona Realty

www.PacellaGroup.com

We have had a lot of optimistic news in our market recently, and we have yet another sign that our
market is moving in the right direction.  One of the major, national builders has begun
purchasing vacant land in the Phoenix metro area. 

 Although I was delighted to hear the news, I really shouldn’t have been surprised.  With the re-sale
home inventory being so low, it would make sense that the builders would be positioning themselves to get back in the game.

The “listing success rate,” (the percentage of listings that sell,rather than expiring or canceling) is 76%, which is up 19% over last year. If you take into consideration that short sales that do not receive lender approval would be calculated in the 24%
that do not successfully sell, the figure is even more impressive.

Additionally, the average price per square foot for active listings is up $3 per square foot over last month, and $11 per square foot over last year, signaling that demand has outpaced supply and listing agents and sellers are no longer trying
to be the most competitively priced property on the block.  The size of the average home that sells has consistently been approximately 1900 square feet, for the past several years.  A little quick math tells us that the average home is being listed for approximately $21,000 more this year, than last year.

So far, we are not experiencing the volume of decline in pending listings that would be typical for this time of year. Listings Pending Sale are down very slightly this week at 11,336. That is a decrease of just 17 pending sales compared to last week. Listings that are active with contingencies account for an additional 7,676 properties.

Current Conditions in the Phoenix Market:

• There are 15,547 single family detached listings, currently active
  in MLS. That is a slight increase
  of 40 listings over last week.
• There are 19,786 total listings currently active in MLS, which
  includes condos, patio homes, townhomes, and lofts.

For additional information, or to view homes for sale, visit www.PacellaGroup.com