Phoenix Prices Gain as Foreclosure Resales Dwindle: DataQuick by Esther Cho

The following article is by Esther Cho regarding the Phoenix real estate market.

After being known as one of the hardest-hit cities, Phoenix has been gaining recognition for its rapidly rising prices.

Dataquick reported the median sale price of a home in the Phoenix metro area in June rose for the seventh month in a row to $152,000, the highest level since late 2008. The figure is a 23.1 percent yearly increase from $123,500 in June 2011. In May 2012, the median sale price was $150,000.

DataQuick, which tracks real estate trends nationally via public property records, still found that June’s median sale price was 42.4 percent below the all-time peak of $264,100 in June 2006, but 28.4 percent higher than the median’s post-peak low of $118,347 in August 2011.

DataQuick explained one of the reasons behind the boost in the median sale price is the area’s mid- to high-end markets have represented a larger share of total sales.

In June, 34.1 percent of all sales were for homes priced above $200,000, compared with 25.6 percent a year ago.

Additionally, the portion of foreclosure sales has been diminishing. According to DataQuick, foreclosure resales, defined as homes that were foreclosed on in the prior 12 months, fell to 21.2 percent of the resale market in June. The figure is the lowest level since January 2008, when foreclosure resales accounted for 18.6 percent of the resale market.

In May, the foreclosure resale level was 24.3 percent and 49.6 percent a year ago. In March 2009, foreclosure resales hit a high-point at 66.2 percent.

The Phoenix area lost 2,087 properties in June to foreclosure, which is a 13.6 percent decrease from May and a 56.5 percent drop from a year ago.

The number of homes lost to foreclosure between January and June numbered 14,591, down 54.1 percent from the same period in 2011.

While the metro has taken a break from foreclosures, downward pressure on home prices is inevitable if the backlog of foreclosures held by lenders are released into the market.

Short sales increased month-over-month, accounting for 13.7 percent of resale activity compared to 12.6 percent in May. Short sales were down compared to last year’s 14.2 percent.

With 9,556 properties (home and condos) sold in June, Phoenix experienced a decline in sales activity from the month and year before, when properties sold numbered 9,896 and 10,425, respectively.