Coming on the heels of the slowest March in 12 years, the Phoenix real estate market posted a year-over-year improvement in April – the first time there has been a YOY leap in any month since July 2005.
That’s 34 months ago and one month before the market started to cool.
April had 5,585 recorded sales in contrast to 4,855 sales for a year ago and 4,335 sales in March 2008. Given the improvement, the basic question is whether this is the first sign of the much anticipated recovery or merely a blip in a continuing weak market, said Jay Butler, director of Realty Studies in the Morrison School of Management and Agribusiness at Arizona State University’s Polytechnic campus.
According to Butler, there were 5,585 closed transactions this April compared with 4,485 closed sales a year ago. Butler also said the median price in the Valley fell to $210,000.
Lower prices can be expected since it is the bank owned home sector fueling the current real estate market. And as I’ve said at least a half-dozen times, that’s not necessarily a bad thing. (One of the first posts was back on January 28, when sales were stagnant – finding the bottom one foreclosure at a time.)
Banks are pricing homes aggressively to sell. Aggressive prices means lower prices, and lower prices means increased demand as affordability re-enters the picture.
Let me bring your attention to something from one other post from the past – What Will the Bottom Look Like:
When the real estate bottoms, what are you going to see swinging upward first – raw sales figures or home values? And do you expect a prolonged flattened trough or a relatively sharp “v” when it happens?
The sharp V rarely happens … rather you see the trough, with the only question being how long the trough stretches. It’s possible there’s more room to go but all evidence is starting to point toward a less steep descent in sales.
It’s just one month … but July 2005 was a long, long, long time ago.[tags]Phoenix real estate[/tags]