For those of us that survived July’s real estate market, we need to know how August treated us. August showed a 7% increase in number of sales (7525 vs. 7021). But what’s happening to prices…? They did continue their decline. Mike Orr wrote a couple of nice articles on prices in August. Check them out @ www.cromfordreport.com.
Let me give you the numbers and then some thoughts on where they are going. The month to month Average Sales Price (ASP) is down 6% to $164,900; Median Sales Price (MSP) is down 4% to $120,000; and Price per Square Foot ($/SF) is down 6% to $85. These are significant drops for a 1 month period. Distress properties (REO’s and Short Sales “SS”) make up 69% of the sale numbers, with SS making up 32%. But the majority of the price decrease is attributable to Normal Sales, i.e. not Distress. Here are the comparisons from The Cromford Report.
| Greater Phoenix / All Dwelling Types | $/SF July 29 | $/SF August 29 | Change |
|---|---|---|---|
| REOs | $67.11 | $68.07 | +1.4% |
| Short Sales & Pre-foreclosures | $84.35 | $81.86 | -3.0% |
| Normal | $119.77 | $108.19 | -9.7% |
| Overall | $90.20 | $85.43 | -6.3% |
So why did this happen? According to Mike, “the overall price decline is primarily caused by two main factors: a steep fall in the sales prices of Normal listings over $300,000 and the relative scarcity of Normal sales in August, particularly higher end homes. We saw only 91 Normal sales priced over $600,000 compared with 142 sales the month before.”
So don’t expect to hear many ‘rosy news stories’ this month. Also remember that we will start to hear about the market’s dismal performance in July. Here we go with the Consumer confidence factor again.
The foreclosure numbers should be out in a few days and I’ll update you on the market when I receive them.
Have a great month!
Jim Sexton
Typical dialogue between Jim and Phil:
That’s what I thought when I first heard about these handy little images. I credit Diane Flannigan (yes, she’s doing great in San Fran!) for first putting them on my radar. Shortly after they showed up, there they were again, and then once more. Once it hit 3 times in 2 weeks I decided to do some googling. Turns out these little barcode-like images make print media interactive. They make your listing flyers interactive. Here’s how…
Wow a last minute reprieve regarding the tax credit! What’s that mean? We’ll have fewer cancelations of the 17,000 properties currently in escrow. With all the discussion regarding an extension for the last couple of weeks, it appears that not all the lenders, sellers and buyers believed that it was necessary to close by 6/30. Oh well June still has, at this time 9083 closed, that’s basically the same as May, but down about 3% from June 2009. REO and Short Sale (SS) trends continue, namely REO’s are dropping (36%) in number and SS are increasing (25%). Pendings are dropping also – they’re now at 10,502, with 7200+ in AWC.
There’s a lot being written about the 
April’s numbers are telling us something. I guess it’s up to us to figure out what. I’ll need a couple of articles for April’s review. First the numbers-9200 closings!!! Wow, 4th month in a row of increases both Month over Month and same Month-year over year (y over y). Actually we have had same Month-y over y increases for the last 23 months-another indicator of market improvement. With 14,506 in Pending status, this trend should continue for another month or two. Yes, I realize that the tax incentive is going away, but the Pending’s have to close by 6/30 to be eligible for the tax credit. The Pending’s, combined with the 8000+ AWC’s are at record levels.
