Phoenix-area Home Values Up 29 Percent From a Year Ago
The huge gains in Phoenix-area home values over the past few months have started to mellow this summer, according to the latest housing report released Thursday by Arizona State University’s W.P. Carey School of Business.
In June, the median single-family home price in metro Phoenix was $150,000. That’s up 2 percent, or $3,000, from May, the ASU report said. While the month-to-month gain was modest, June figure were up 29.3 percent from a year earlier.
Sales of single-family homes in June were down 16 percent from a year ago, which was largely driven by the diminishing supply of existing homes on the market.
For example, Phoenix-area inventory was down 33 percent as of Aug. 1 from a year earlier. The supply of distressed properties, or lender-owned homes, fell by a staggering 68 percent during the same period, the report said.
The dwindling supply has fueled a huge imbalance of more buyers than sellers in the marketplace, fostering a fiercely competitive environment where homes for sale, especially those priced below $250,000, are attracting large amounts of offers that frequently exceed the asking price, said Michael Orr, the report’s author and a real estate expert at W.P. Carey.
“The situation for the average home buyer remains dire, despite low interest rates and historically cheap prices,” Orr said in the report. “That’s because of the low inventory, and any offer from an ordinary home buyer is typically going to be less attractive than the multiple all-cash offers from investors with few strings attached and no appraisal required. Many ordinary buyers are coming away empty-handed after submitting 10 or more offers.”
In fact, the Phoenix market has become so flush with investors that 38.4 percent of home sales in June were purchased without financing, he said. By comparison, that number was only 8.3 percent back in June 2007.
- Kristena Hansen,Reporter
- Phoenix Business Journal