November 2008-What a month!!! Yes the elections are over and now what? Congress goes back into session to address the economy and determine how many more billions it takes to correct the economy. Is that good news or bad news?
Although housing is center stage, other industries are lining up for help such as the Automakers and more Financial Institutions (or the same Financial Institutions wanting more). President-elect Obama and his new appointees/advisers have their hands full.
But let’s stick to what’s happening in our own backyard in the industry we understand and can report on. Yes Phoenix, there is a real estate market, contrary to the Arizona Republic’s reporting and their focus on foreclosures for the next 2 weeks. Is that an “end of the year” pep talk? Maybe the last few topics will be on the opportunities that exist today in our market. Hopefully their readers don’t get turned off by the first few doomsday headlines and miss reading the good news articles that are yet to come.
Let’s look at some early numbers for November as reported by ARMLS:
4200+ sales with an average sales price of $210,000;
1896 were REO’s and their average was $155,000 or 39% lower than the Non-bank owned 2370 @$254,000 average sales price.
Looking at Maricopa County only:
3690 sales $221,000 average;
1640 REO-$162,000 average;
2050 non-REO $269,000.
These numbers are encouraging for another reason. November was a “short” month. Yes I know, February is the shortest month, but count the number of business days this November. With most banks and county facilities closed on the Friday after Thanksgiving, the last business day was Wednesday the 26th. So, November was the shortest month of the year. But, it was not a “Going out of Business” month. In fact check the numbers and compare them to 2007. 11/08 number of sales was 28% higher than 11/07. In fact 2008 total number of sales will exceed all of 2007′s sometime this week and should end the year 3-4,000 above 2007. I haven’t seen that reported yet.
Plus 2008 heading into 2009 will prove to be the most affordable market in Phoenix for at least the last 4 years when you factor in not just prices but interest rates.
I’ll post later in my series a comparison of prices over the last 5 years. As we begin the final month of the year, the Greater Phoenix marketplace hasn’t seen the average price and median price figures this low since 2004. And the trend over the last 6 months is $30,000 less than the first half of the year.
So you can focus on the foreclosure market and the hardships it has caused, or search for the opportunities that are present in today’s marketplace. Buyers who were priced out of the market in 2005-6 or voluntarily stayed on the sidelines for the past 3-5 years are poised to enter/reenter the market and profit from 2008′s price adjustments. Now more than ever you should be communicating with your clients by identifying the trends and sharing the opportunities in today’s market.
It’s up to the non-media to keep things in perspective. NAR recently wrote and article with stats showing improvement. In the article it said confirmed that Buyers who have been shut out of the home ownership market, are now finding that they can afford to buy. And they ARE buying. Three states where the ‘housing bubble’ has burst are seeing some of the highest increases in sales. The largest sales gain during the third quarter was in Arizona, up 28.3 percent from the second quarter, followed by California which rose 28.1 percent and Nevada, up 26.2 percent. These areas have seen some of the strongest sales gains with some reports of multiple bidding.