There’s a debate brewing over the number of sales that actually are taking place here in the Phoenix real estate market.
Jay Butler, director of real-estate studies at Arizona State University’s Morrison School of Management and Agribusiness, apparently had been including as sales homes where the banks have taken over ownership of the property after foreclosing on the owner and failing to find a new buyer on the courthouse steps.
Removing these non-sales from the numbers, and sales actually were not higher year over year than they were a year ago as was reported in numerous places, including right here on AllPhoenixRealEstate.com.
Supply and Demand in Phoenix
Though the news isn’t as sexy as the first year-over-year increase in three years, there still are some signs of improvement in the market. Prices continue to decline under heavy pressure from banks attempting to clear out their inventory of REO properties, but basic supply and demand – to the point, steadily falling inventory and steadly increasing sales – are leading to increasingly lower absorption rates.
Lowered prices also will lead to increased affordability which leads to more buyers taking the leap and entering into the market. Timing the bottom (an impossible task, yet one that many still attempt) often is less about current numbers and more about perception of the market’s short-term direction.
One Other Discrepancy
I’m still working on getting my arms around the reasons why Butler’s resale numbers are almost always lower than the data available through the Arizona Regional MLS, especially since his figures include sales such as new builds not included in the MLS.
While it’s true some agents will not update a pending sale that doesn’t close, I’ve not seen this happen a great deal. And it makes little sense, seeing as the agent then is left to try and sell the house anew and would want the listing active.
Even assuming this does occur, it doesn’t seem this should account for major differences in sales figures, at least not when looking at the raw numbers from ARMLS.
But that’s another issue for another day.[tags]Phoenix real estate[/tags]