Improving indeed.  RL Brown said it back in January, the PMI reports confirmed it last week, and here we’ll show you some ARMLS figures that support it as well.

The quote we’ve repeated a number of times from RL Brown is that here in Phoenix we’ve already drank our tomato juice and popped our aspirin.  Of course he is referring to getting rid of the hang over from the real estate party of 2005.  His report showed that 70% of the new home prices had remained the same or went UP over the 4 months prior to his report.  He also discussed the stability of new home permits over the 6 months prior. 

Jay Thompson wrote a nice summary of the latest PMI report that indicates even though our numbers aren’t anything to write home about, they are among the few in the country that are moving in the right direction.  85% of the areas studied got lower scores compared to the last time the report was done - Q4 2007.  Phoenix was among the 15% that have improved.

ARMLS has reported sales volume increases every month since the beginning of the year.  The news got even better last month when June ’08 outperformed June ’07.  It was the first time we have had a year over year sales volume increase in nearly three years. 

When we split the ARMLS numbers into 2 groups – above and below $350,000 – we have found that there is a normal market for the lesser priced bracket.  In fact, there were more than 4,700 sales last month under $350,000.  Compare that to the 35,000 active listings in the same bracket and that’s a 7 month supply.  Something tells us the FHA loan limit has A LOT to do with this.

So between RL saying the new home market has recovered, more than half of the market that ARMLS serves getting back to a normal inventory level, and our PMI risk factor going down, we’re starting to look much better my friend.

The ”First Quarter Market Overview Presentation” took place this morning (4/24).  RL Brown presented his coveted data with his partner Greg Burger.

Greg began by presenting some statistics for the “Metropolitan Phoenix Market Place”. There were a lot of figures presented in a half (here are the numbers) and half (buy our product so you can have this data at your fingertips) format. Some of my scribbles include…

• 1,890 new home closings in March (4,200 resales)

• Largest segments of new home sales – Mesa/Gilbert and the “southwest”

• 55% of 1st quarter new home sales were under $249,000

Then RL took over and started speaking more about the challenges, opportunities, and differences with the resale market vs. new home market. When it comes to the resale market, he does not feel we are at or near the bottom.  He made the statement that agents bane is going to switch from over-priced listings to REO properties and that the 50+ thousand listings in ARMLS is going to continue to drive prices down.  Once the median price drops another $20k then consumers are likely to come out and play, but their motives are going to be changed from preparing for retirement to improving their quality of life.

In his section about new homes, he stated, ”We are at the bottom of the new housing sector (pause) or darn close”.  His reasoning for this statement included the stability that both permits and closings have shown; permits leveled out about 6 months ago and closings have been steady for the last 3 months. He continued with the fact that in the last 4 months 60% of new home prices have stayed the same, 9% have gone up and only 30% decreased. 

In his conclusion he assumes that everyone knew the hang over was coming, but at least here in Phoenix we’ve already drank our tomato juice and popped our aspirin (hence the title quote).  He reminds all participants to treat each local market or neighborhood as its own market and to generalize on a national base has a lack of reality.