Buyers Go West for Good Deals

From Realty Times of October 17, 2008

Hot Market: Buyers Go West for Good Deals by M. Anthony Carr

You've heard the news that pending sales are up across the country over 7 percent from July to August. While that's the broad brush news, when looking at the details, one sees just how many states in the West are experiencing a huge surge in the number of sales being registered on real estate boards across the region.

Following the trends over the last two quarters, it should be no surprise that the real estate market across the country is slowly beginning to show signs of life. The National Association of Realtors, keeper of national realty sales data, has been releasing the numbers all year of state after state experiencing very healthy sales increases from the 1st quarter to the 2nd quarter.

Leading the way is Idaho, with a 51 percent jump between the two quarters. California was up 25.8 percent followed closely by Nevada at 25 percent. The fourth strongest statewide market was Arizona, up by 20.5 percent.

The only two states to show a quarter over quarter increase from 2nd quarter 2007 to 2nd quarter 2008 was California, up 3.7% and Nevada surging forward at 18 percent.

When news hit about this latest sales increase of 7.4 percent, hidden, again, in the fine print was the fact that sales year over year in the west had jumped a whopping 37 percent. The challenge facing markets now, of course, is the current credit crisis, which will determine if the trends of upward bound sales will continue.
--------------------------------------------------------------------------------
Copyright © 2008 Realty Times. All Rights Reserved.

Biggest concern now, is it getting too crowded out here? We are projected to double in population in only a decade or two from now!


.

PHOENIX AREA SALES

The Arizona State University maintains a very active Realty Studies Group.

As stated on their web page, "Since 1980, the primary objectives of ASU's Realty Studies have been to serve as a focal point for research and educational projects of faculty members, both in real estate and in allied disciplines throughout Arizona; to analyze and evaluate the Arizona real estate market on behalf of private, public, and governmental organizations; to conduct studies related to real estate, and to publish the results of those studies; and to assist in the development of real estate educational programs throughout Arizona that will enhance the professionalism and knowledge of those involved in the real estate industry."

They are highly regarded by the Arizona Real Estate Community, with Mr. Jay Butler the acknowledged spokesman for the organization.

Subsections of the report at the web site include historical data on Sales Activity, Affordability Indices, Construction Activity, Office Activity, Retail Activity, Greater Phoenix Indicators and Maps.

Individual cites, 26 Phoenix Communities in all , including the East Valley Cities of Chandler, Gilbert, Tempe, Scottsdale, Queen Creek, Higley, Mesa appear in the Sales and Median history data.

The ASU Realty Studies Web Site begins here. We recommend you save the web site in your Favorites file.

CURRENT EAST VALLEY MARKET INFLUENCES

The country's fifth largest city is in the desert, according to the latest Census Bureau estimates. Now, to whom do you suppose this article is referring?

Head Count Shows Shifting Population

Note that they are only referring to the city of Phoenix when they state that 43,000 were added to the population between 2005 and 2006. This is over 117 people per day, folks.

To get the full picture for the Phoenix Metro Area, go to:

Maricopa County MapStats

You will find that Maricopa County population is estimated at 3,768,123 at the end of 2006. A little quick math comparing the 2000 population to 2006, per the census, says "The County" has been growing at 116,000 people average per year for the last 5 years. That's roughly 3% per year! And over 317 people per day!

I am frequently asked if the home we are looking at will appreciate. I have no crystal ball! However, allowing for the fact that we had a lot of mis-guided "out of state" investors in year 2005 (no population change - just houses sold) that are licking their wounds and creating a Buyer's market (stabilization phase), and given that our rental vacancy rate is way down, appreciation is more likely a "when" than "if" question.

Meantime, it is more difficult for 1st time home buyer's as several lenders have fallen by the wayside for too many risky loans and have put many homeowners in jeopardy as highlighted by this article:

Home Equity Loan Delinquencies Rise

I should note that Maricopa County Bond money is available for "no down payment" loans as this is written.

So, we are in a "stabilization period", even with continuing population growth.

Bottom line - Maricopa County, and particularly the East Valley, will be at the forefront of the national housing recovery. Continued population growth, the general shift of population from the cold regions, tornado states, and hurricane alley, and continued strong employment opportunities will put us back on the Appreciation Track!

Anybody for a pool as to when that day will come?

GILBERT and ARIZONA

The Arizona Republic of June 28, 2007, reports that Gilbert, in the Phoenix East Valley, is now the 5th fastest growing city in the U.S. with a population of 191,500 at the end of 2006.

A bit of coincidence but Phoenix is now the 5th largest city in the U.S. at over 1.5 million population. Maricopa County, which includes metropolitan Phoenix, has a population of 3,768,123 as of July, 2006. It now ranks fourth among the nation's counties and is greater than the population of 23 of the 50 states. The center of population of Arizona is located in Maricopa County, and just by happenstance, in the town of Gilbert.

We are blessed with a warm climate, excellent city and state management, and a great economic climate to boot. The bets are that the Phoenix Metro area will rebound well ahead of the rest of the nation in the Real Estate sector. Sales of single family detached homes so far in 2007 is 26,518 with an available inventory of 54,250 as of this writing - a 1 year supply of homes with more and more Sellers finally realizing the boom is over and reducing prices accordingly. With mortgage rates returning to the 6% region again, ( http://www.bankrate.com/brm/news/mtga/June2807_mortgage_analysisa1.asp ) it is an exceptional time to buy in the Phoenix area.

And yes, I do believe what I just wrote.