Arizona Real Estate Market Statistics
January 2012
December, typical of most months in 2011, saw its own share of good news. A rise in sales activity, typical of the last month of the year, and the continued decline of new inventory added to the mar-ket led the list. Other positive signs include declines in total inventory, MSI and foreclosures pend-ing. In the positive category, STAT also places the shift in the distressed sale composition, with short sales surpassing foreclosures for the first time, and distressed sales remaining below 60% of total sales for the second month in a row.
While the valley has seen the signs of recovery in many metrics, pricing remains problematic. New list prices in December were singularly lackluster, with the median and average new list prices de-clining 5.8% and 10%, respectively. Sales pricing though, both median and average, rallied in Q4, and finished the year racking up single digit gains over 2011, albeit slight.
The most holistic perspective lies in embracing that pricing recovery is built overtime, in layers, on strong pillars. On the supply side, total inventory and new inventory added each month must come down. Even though these numbers are not where they should be, they are moving steadily in the right direction. Distressed properties, which wreaked havoc on pricing, needs to exert less domi-nant pricing influence. These metrics are doing just that as their percentage of sales declines, and lenders trend to short sale work outs over foreclosures. While these figures are also not ideal, they too are inching appropriately in a positive direction.
On the demand side, the Valley is experiencing record sales activity, despite anemic net migration and job creation. Other economic news should positively affect demand. Arizona, at a 2.8% pro-jected 5 year growth rate, is number three right behind Texas and Nevada.1 According to Lee McPheters of the JPMorgan Chase Economic Outlook Center at the W.P.Carey School of Business, Arizona’s population should increase by 1.5 percent in 2012 to support housing demand, including a 20 percent rise in single-family housing permits.2
The prognosis delivered December 7 at the 48th Annual Economic Forecast Luncheon, co-sponsored by the economics department at the W. P. Carey School of Business and JPMorgan Chase, diagnosed Arizona as a state that is no longer in “intensive care,” but now proceeding through a slow recovery. Arizona will end 2011 as a top ten growth state, now adding jobs faster than the national average, after a weak start in the first half of this year. Yet the slow recovery is influenced by job growth, which is still below the long term average (3.7%), and lower than previous recoveries.3
Credit bureau TransUnion, which tracks consumer credit predicts mortgage delinquencies, will fall more sharply in Arizona next year than in any other state. In addition, it expects the proportion of past-due Arizona home loans will drop nearly in half by the end of 2012, albeit from high levels.4
STAT’s prediction for 2012: GAME ON - we have a recovery in process!
While the valley has seen the signs of recovery in many metrics, pricing remains problematic. New list prices in December were singularly lackluster, with the median and average new list prices de-clining 5.8% and 10%, respectively. Sales pricing though, both median and average, rallied in Q4, and finished the year racking up single digit gains over 2011, albeit slight.
The most holistic perspective lies in embracing that pricing recovery is built overtime, in layers, on strong pillars. On the supply side, total inventory and new inventory added each month must come down. Even though these numbers are not where they should be, they are moving steadily in the right direction. Distressed properties, which wreaked havoc on pricing, needs to exert less domi-nant pricing influence. These metrics are doing just that as their percentage of sales declines, and lenders trend to short sale work outs over foreclosures. While these figures are also not ideal, they too are inching appropriately in a positive direction.
On the demand side, the Valley is experiencing record sales activity, despite anemic net migration and job creation. Other economic news should positively affect demand. Arizona, at a 2.8% pro-jected 5 year growth rate, is number three right behind Texas and Nevada.1 According to Lee McPheters of the JPMorgan Chase Economic Outlook Center at the W.P.Carey School of Business, Arizona’s population should increase by 1.5 percent in 2012 to support housing demand, including a 20 percent rise in single-family housing permits.2
The prognosis delivered December 7 at the 48th Annual Economic Forecast Luncheon, co-sponsored by the economics department at the W. P. Carey School of Business and JPMorgan Chase, diagnosed Arizona as a state that is no longer in “intensive care,” but now proceeding through a slow recovery. Arizona will end 2011 as a top ten growth state, now adding jobs faster than the national average, after a weak start in the first half of this year. Yet the slow recovery is influenced by job growth, which is still below the long term average (3.7%), and lower than previous recoveries.3
Credit bureau TransUnion, which tracks consumer credit predicts mortgage delinquencies, will fall more sharply in Arizona next year than in any other state. In addition, it expects the proportion of past-due Arizona home loans will drop nearly in half by the end of 2012, albeit from high levels.4
STAT’s prediction for 2012: GAME ON - we have a recovery in process!
Article courtesy of ARMLS.
STAT Publication - JANUARY(current real estate market conditions)
