FountainHalf way into 2013 – Where’s Phoenix Real Estate Going and Why?

2012 was a good year for real estate in Phoenix, and the question going into 2013 is “Can prices continue to go up like they did in  2012?” Price appreciation in 2012 in many cities resulted in appreciation over 20%, and sellers eagerly want prices to climb back to 2005 – 2006 levels after enduring 4 brutal years leading up to the market bottom in 2011.  Buyers are also asking what has happened to distressed properties in 2013?  Are foreclosures/short sales coming back? Is the end to the recent price increase right around the corner? Now that we’re more than half way into 2013, the answer to these questions is becoming evident.

 

Distressed Sales by City July 2013

The healing continues for the Phoenix real estate market

The graph to the right is one of my favorite graphs because it is an indicator of market distress within each city.  Instead of throwing out a broad market statistic, the true health of each city is indicated by the percentage of  foreclosure and short sale transactions.  The real substance to this snapshot is the comparison to previous years. To see how far we’ve come, click back to this same chart 2 years ago in 2011, right when the market was bottoming out.  In July 2011, 85% of Avondale’s sales were distress, now  30%. Chandler was over 65%, now its at 2013 Pending Foreclosures graph16%. Mesa distressed sales as a percentage of total sales were over 70%, and have now decreased to 22%. Gilbert went from 63% to 17%. Even Tolleson which saw distressed sales over 90% of total sales two years ago have plummeted to less than 40%.  Many bargain hunting buyers have also noticed the scarcity of short sales and foreclosures that were a source of low priced properties.

One  of the reasons is the continued reduction in pending foreclosures over the past 3 years.  By the end of the year, the pending foreclosures should be where they were in 2004!  Increasing prices have also reduced short sales by reducing the underwater properties.

Cash Buyers – Are they still out there?2013 Cash Purchases

A popular topic regarding who is buying real estate in Phoenix turns to investors. Frequently, first time home buyers will recount how many times they submitted offers only to lose to a cash buyer.  A review of the chart to the right  shows a steady decrease in purchases of homes with cash since the beginning of 2012. The most recent value of 29% is the lowest since June 2010.   Since 2008, the increase in cash purchases, many by investors is supported by the fact that homeownership has decreased from 69.2% at the end  of 2004,  to a low at the end of March 2013.  So are cash buyers still out there? “Yes”, but the trend is downward as prices rise, ROI decreases and distressed sales diminish.

More homes on the market in some cities

Gilbert Historical listings

Some valley cities are have seen a rise in inventory. It is amazing to see the dramatic fluctuation we’ve experienced over the last 3 years. The graph to the right shows Gilbert inventory or homes for sale going back  to Nov. 2010 when the majority of listings were either foreclosures(brown) or short sales (light blue).  Currently in Gilbert and the rest of the valley, listings of normal sales(blue) are higher than they’ve been in at least 3 years. Buyers looking for foreclosures and short sales are finding fewer and fewer.  Other cities also seeing a rise in inventory in the last 4 – 6 months include Avondale, Chandler, Glendale, Mesa, Peoria, Tempe, Queen Creek and Phoenix. Some cities that have seen a reduction in inventory or maintain current levels in the last 4 – 6 months; Gold Canyon, Goodyear, Scottsdale, Sun City, Sun Lakes and Surprise. Age restricted communities typically see inventory listings increase the last half of the year.

And Interest Rates. . . .

The effect of  interest rates must be factored into the demand side of the equation.  Rates in the last couple of months have risen by more than 1%. To see the effect that this can have, consider a buyer that can afford $1,200/month  for principal and interest.  With a 10% down payment and a 4% interest rate, the buyer can afford a $280,000 home.  When interest rates go up to 5%, that same $1,200 per month mortgage allows the  buyer to purchase a $250,000 home. That 1% rise in rates reduced the purchasing power by $30,000.

So tell us about prices….

Mesa 2013 GraphI know that you’ve kept reading so you can get to the good stuff, where are prices going?   Every city saw significant appreciation during 2012.  For many cities the start of 2013 is an extension of last year. However, there is moderation or reduction of appreciation in others as measured by the average price $/sq.ft. For example, Mesa is showing 13% year to date as seen in the graph to the left, and may come close to that seen in 2012.Goodyear 2013 Graph

Other cities such as Surprise, Scottsdale, Sun Lakes, Gold Canyon, Sun City West, Casa Grande, Apache Junction and Goodyear have seen weaker appreciation when viewing appreciation measured by Average Price$/Sq.Ft. of sold homes and may not reach the levels they saw during 2012.  The graph to the right shows appreciation for Goodyear which is at about 6% year to date appreciation, about half that of Mesa’s.

Cities that have shown strong positive appreciation during the first half of the year include Avondale, Phoenix, Tempe, Chandler, Gilbert, Peoria, Mesa, and Glendale.  Obviously, within each city there will be 2013 Gilbert Graphvariations depending on square footage, year built, price point, features, condition, lot size, etc.   If you’d like me to review comparable sales for your property, click on What’s the Value of My Home. To receive available homes for sale, click on Send Me New Listings.

A reduced appreciation rate compared to 2012 is understandable as prices continue to climb when buyer’s income isn’t increasing as rapidly and the increase in mortgage interest rates reduces buying power.  Coupled with the reduction in distressed properties points to the Phoenix market and surrounding cities returning to a more normal market.  Wow, its been a long time since we’ve seen one of those!

 

Other posts in the blog

Arizona Monsoon Storms

Are addresses in Phoenix cities that helpful?

Who loses on a foreclosure, the bank? Think Again!

 

$475,000 :: 1248 N PALMSPRINGS Drive, Gilbert AZ, 85234

3 beds, 2.5 baths
Home size: 2,083 sq ft
Lot Size: 6,534 sq ft
Added: 05/27/18, Last Updated: 05/27/18
Property Type: Single Family
MLS Number: 5772091
Community: LANDING 2 AT VAL VISTA LAKES L
Tract: LANDING 2 AT VAL VISTA LAKES L
Status: Active


SPECTACULAR REGATTA LAKE VIEW! A former model home w/3BR+loft. Casual elegance in LR/DR with plantation shutters, vaulted ceilings & a gracious stairway. Family room boasts a fireplace. Kitchen has solid surface counters. Relax on the 2nd story balcony w/awsome views of the lake. All new upgraded carpet, large tile & light fixtures. The garage has professionally installed epoxy floors and cabinets. Backyard features heated play pool and flagstone. Enjoy the ammenities which include the multi-million dollar clubhouse, heated pool, sandy beach, tennis, racquetball, weight rm., banquet areas, plus 4 lakes and many walking paths w/low HOA. Great Gilbert schools.

Listed with LRA Real Estate Group, LLC


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$553,500 :: 362 S BAY SHORE Boulevard, Gilbert AZ, 85233

Property Photo

Mls Icon

4 beds, 2.5 baths
Home size: 3,211 sq ft
Lot Size: 6,534 sq ft
Added: 02/17/18, Last Updated: 05/26/18
Property Type: Single Family
MLS Number: 5725089
Community: DESERT SHORES AT THE ISLANDS
Tract: DESERT SHORES AT THE ISLANDS
The price of this listing was last reduced on 5/26/2018 by 1%
Status: Active


Please text or call for Full Video Virtual Tour. This gorgeous home has been professionally remodeled and it shows! Flagstone & wood throughout all areas! Beautiful Kitchen has upgraded Alder Cabinets, Granite Counters, & Stainless Steel Appliances! Open layout to family room features a wrap around wall system & Corner Granite Eichler Gas Fireplace, Surround Sound, & wall to wall windows w/ amazing views of the lake! Master Suite, has highly upgraded bathroom w/ Carerra Marble Counters, porcelain tile shower & much more! Backyard features flagstone throughout all patio areas, gazebo w/outdoor cook center, Lynx BBQ, gas firepit, waterfall, newly renovated oversized dock & breathtaking views of the water is a private small park on the lake.

Listed with Keller Williams Realty Sonoran Living


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$575,000 :: 1002 S CROWN KEY Court, Gilbert AZ, 85233

Property Photo

Mls Icon

3 beds, 2 baths
Home size: 2,592 sq ft
Lot Size: 10,018 sq ft
Added: 05/25/18, Last Updated: 05/26/18
Property Type: Single Family
MLS Number: 5771648
Community: KEY HARBOR LOT 1-71 TR A-C
Tract: KEY HARBOR LOT 1-71 TR A-C
Status: Active


DREAMS FOR SALE! Exceptional and impeccably kept 3 bedroom/Den , single level Home in the highly desired subdivision of The Islands! Pristine Waterfront lot with multiple outdoor entertainment areas. NEW ROOF 2018. Neutral color Decor. Updated plank-tile flooring with upgraded carpet. 2 Fireplaces both indoor/outdoor. 2 Bay Windows @ Kitchen & Master Bedroom. Modern Gourmet Kitchen with Black Appliances. With acceptable offer, Seller is willing to credit buyer $2500 toward an appliance pkg. Vaulted ceilings and beautiful spacious Floorplan. Double gate with parking for ''Boats/Toys''. 3 car garage with workbench and storage. This home as a single level on the water w/ 3car G, RV parking etc does not come available very often. Located just a few miles from DT Gilbert.Must See Photo Gallery

Listed with Re/Max Infinity


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$355,000 :: 517 S MARINA Drive, Gilbert AZ, 85233

Property Photo

Mls Icon

3 beds, 2.5 baths
Home size: 2,003 sq ft
Lot Size: 4,356 sq ft
Added: 05/25/18, Last Updated: 05/25/18
Property Type: Condo/Townhouse/Co-Op
MLS Number: 5771244
Community: CORAL POINT TRACT A-K
Tract: CORAL POINT TRACT A-K
Status: Active


Picture yourself fishing off your personal doc or tying your boat off right behind your home. If this is your dream, then this is your home. Upon entering notice the soaring 26ft ceilings in your open and airy living room with 2 large glass sliding doors that open onto a tile patio compete with 2 fire pits, a pond, an in ground spa and amazing views of the lake. This charming home has an updated kitchen with white cabinets, granite counter tops, a granite backsplash and once again beautiful views. Upstairs the large master suite includes his and hers closets, vaulted ceilings and a deck overlooking the lake. Don't miss out on the chance to live in your own ''Island'' paradise.

Listed with Keller Williams Realty East Valley


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$568,000 :: 432 S BAY SHORE Boulevard, Gilbert AZ, 85233

Property Photo

Mls Icon

4 beds, 2.5 baths
Home size: 2,521 sq ft
Lot Size: 7,405 sq ft
Added: 05/24/18, Last Updated: 05/24/18
Property Type: Single Family
MLS Number: 5770856
Community: HARBOR POINT LOT 1-78 LAKE EAS
Tract: HARBOR POINT LOT 1-78 LAKE EAS
Status: Active


Beautiful remodel on the water in the Islands! New wood floors greet you as you open the door to the living and dining areas. It then flows into the kitchen & greatroom which overlook the sparkling pool, lake & grassy backyard. The kitchen has stainless appliances & plenty of counter space including a perfect area for a coffee bar! Upstairs is the master with a balcony with views of the lake. The master has a large ensuite bathroom and large walk in closet. The secondary bedrooms are also upstairs and are all a generous size. The second full bath is adjacent to the other bedrooms. The home also has a 3 car garage! New carpet, new wood floor, new lighting, new kitchen design, newly resurfaced pool, freshly painted inside and out and much more! This home is move in ready!

Listed with Coldwell Banker Residential Brokerage


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$759,000 :: 1825 E MONARCH BAY Drive, Gilbert AZ, 85234

Property Photo

Mls Icon

4 beds, 3 baths
Home size: 3,140 sq ft
Lot Size: 11,761 sq ft
Added: 04/23/18, Last Updated: 05/23/18
Property Type: Single Family
MLS Number: 5755855
Community: CRYSTAL SHORES AT VAL VISTA LA
Tract: CRYSTAL SHORES AT VAL VISTA LA
The price of this listing was last reduced on 5/23/2018 by 5%
Status: Active


Must see this beautiful and updated home with dramatic vaulted ceilings on the 'big' lake in the much sought after community of Val Vista Lakes*Enter to living room and separate dining room*Island kitchen has been remodeled with stainless steel appliances, gas stove, beautiful cabinets, walk in pantry and eating area*Family room has marble gas fireplace*Luxury master suite boasts remodeled bathroom with double head shower,Jacuzzi tub, double sinks, and closet organizers*Fabulous yard has outdoor kitchen with sink, bar and grill, *Beautiful pebble tec pool and separate spa with new heater*High pressure mister systems on downstairs patio and upstairs deck*Val Vista Lakes community includes 4 lakes, a swimming lagoon, junior Olympic pool, Jacuzzi*The clubhouse includes cardio room,

Listed with Penfield Properties


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$479,000 :: 433 S LAKE MIRAGE Drive, Gilbert AZ, 85233

Property Photo

Mls Icon

4 beds, 3.5 baths
Home size: 2,593 sq ft
Lot Size: 5,227 sq ft
Added: 04/06/18, Last Updated: 05/19/18
Property Type: Single Family
MLS Number: 5747954
Community: LAKE MIRAGE LOT 1-38 TR A-I
Tract: LAKE MIRAGE LOT 1-38 TR A-I
The price of this listing was last reduced on 5/19/2018 by 2%
Status: Active


One of the most incredible view lots in The Islands with soaring ceilings and windows to appreciate the one-of-a-kind long lake view in multiple directions. This beautiful home comes with designer kitchen, granite countertops, travertine flooring, and upgraded finishes thought. Two masters, one up and one downstairs equipped with two vanities. Relax outside while enjoying the tranquil water or enjoy an active lifestyle community with restaurants and shopping within walking distance. Exterior includes built in dock, entertaining fridge, and second story patio with views galore.

Listed with Revelation Real Estate


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$519,000 :: 1252 N PALMSPRINGS Drive, Gilbert AZ, 85234

Property Photo

Mls Icon

4 beds, 2.5 baths
Home size: 2,714 sq ft
Lot Size: 6,534 sq ft
Added: 05/18/18, Last Updated: 05/19/18
Property Type: Single Family
MLS Number: 5768551
Community: LANDING 2 AT VAL VISTA LAKES L
Tract: LANDING 2 AT VAL VISTA LAKES L
Status: Active


MAGNIFICENT LAKE FRONT HOME! Remodeled Four Bedroom Home with Formal Living & Dining Rooms with tile flooring and granite stairway to upstairs. Outstanding Lake views from all windows and has balcony off master bedroom overlooking the lake. The Kitchen features granite counter tops with upgraded cabinets, a walk-in pantry and island with breakfast bar. The spacious master suite features a private balcony exit, full bath, double sinks, separate tub and shower, and large walk-in closet. The grassy backyard includes an extended covered patio overlooking the Lake! The large 2 1/2 car garage has epoxy flooring. Enjoy the Val Vista Lakes Clubhouse, workout room, heated pool, sandy beach lagoon, lighted tennis courts, racquetball, waterfalls, community activities, fishing, boating!

Listed with ProSmart Realty


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$480,000 :: 542 N MONDEL Drive, Gilbert AZ, 85233

Property Photo

Mls Icon

4 beds, 3 baths
Home size: 2,913 sq ft
Lot Size: 8,712 sq ft
Added: 01/29/18, Last Updated: 05/18/18
Property Type: Single Family
MLS Number: 5715811
Community: PLAYA DEL REY AMENDED
Tract: PLAYA DEL REY AMENDED
The price of this listing was last reduced on 5/18/2018 by 2%
Status: Active


WOW! Honey stop the car, this is a great location close to schools, parks & shopping. A highly desirable area with a ski lake. This home is on the water with a fountain you can see from all your rear facing windows. 4 bedroom with one bedroom downstairs & a full bath downstairs, formal living & dining, Gourmet kitchen with granite counter tops open to the great room,3 bedrooms upstairs & loft, tile in all the right spots. Huge covered patio with barbecue great views to enjoy all year long. 2 car garage with cabinets, new water heater & dishwasher and fresh paint. Truly a must see, it won't last long.

Listed with Southwest Mountain Realty, LLC


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!


$1,085,000 :: 1506 E TREASURE COVE Drive, Gilbert AZ, 85234

Property Photo

Mls Icon

5 beds, 4.5 baths
Home size: 5,706 sq ft
Lot Size: 17,859 sq ft
Added: 02/23/18, Last Updated: 05/17/18
Property Type: Single Family
MLS Number: 5727612
Community: WEST LAKE ESTATES LOT 1-40 TRA
Tract: WEST LAKE ESTATES LOT 1-40 TRA
The price of this listing was last reduced on 5/17/2018 by 4%
Status: Active


Beautiful Waterfront Home! Luxury living in gated WestLake Estates close to the Val Vista Lakes Clubhouse! The home has 3 bedrooms on the main floor (2 w/views of the lake), all connected to baths, the grand master suite is on the second floor with a private balcony facing the lake, large walk-in closet, luxury master bath & fireplace. Walkout basement suite is perfect for guests w/an exit to the backyard, bedroom, full bath, fireplace & kitchenette. the large kitchen has lots of cabinet & counter space, built-in refrig/freezer, gas cook-top, breakfast nook looking out to the beautiful backyard & an exit. Formal living & dining along with large family room including a floor-to-ceiling fireplace w/views to the amazing backyard. Negative edge diving pool, outdoor kitchen, gas firepit etc.

Listed with Re/Max Infinity


Brought to you by Gordon Baker, Remax Alliance Group. Call me today at 480-326-8571, or visit my website at www.myhomeinaz.com/!