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Saturday, April 29, 2017

Area Continues to See Increase in Real Estate Prices

For 2016, home prices in South Phoenix and Laveen galloped ahead with double-digit increases for all three ZIP codes in South Phoenix and a 9 percent price increase for homes sold in Laveen.

Home prices in Laveen increased from a 2015 average of $198,700 per house sold to an average of $216,400 for last year. In 85040, the average 2015 price was $132,500, up 12 percent from the $116,600 in 2015. Prices increased 13.6 percent in ZIP code 85041 to $187,400 up from about $162,000 the prior year. In 85042, the average sales price was $214,000 up 13 percent compared with 2015. All data is from the Arizona Multiple Listing Service, which does not include homes sold outside the listing service.

“Overall the Laveen and South Mountain real estate markets appear to have a firm foothold and continue to move forward at a healthy pace,” said Sam Lawmaster, a Laveen Realtor with the Realty ONE Group in Goodyear. “The continuation of historically low interest rates during 2016 has kept the momentum going in real estate by allowing buyers to purchase more home, as less of their mortgage payment goes towards interest.”

Real estate experts say the 2016 increases put the local housing market back on track to where it would have been if there hadn’t been a housing bubble that burst.

“Housing prices are consistently rising,” said Koni Gould, a Laveen Realtor with United Brokerage in Chandler. “The bottom line is all the graphs show that the housing prices are right where they would have been if we hadn’t had the bubble in 2004-2006.

“With that being said, the houses that were purchased in 2004 are selling for about what people paid for them. But the homes bought in 2005 and 2006 – at the height of the bubble – still have a way to go before values will match purchase prices.”

Gould said that if the housing market stays steady, home prices average a 4 percent annual increase – so it will take another six to eight years before the folks who bought at the high end of the market high will recoup their purchase prices.

Carlie Back, owner of the Carlie Back Team and a Realtor with Keller Williams in Phoenix, said the numbers reflect a “strong and balanced housing market.”

“Last year was a very strong year,” she said. She predicts 2017 will keep the same pace.

“We have good job growth. We don’t have national disasters like other places. Our prices are affordable and interest rates are still low,” Back said.

She believes the $180,000 to $200,000 price range will remain strong, as there still are not quite enough homes to meet demand for that market – making it a strong seller’s market.

For higher-price homes, such as $400,000 and up, buyers in that price range tend to overlook South Phoenix and Laveen.

“The higher end is more of a buyer’s market. There aren’t as many buyers looking … they would be pleasantly surprised if they did and they saw what they would get for the money,” Back noted.

One factor that may slightly slow home sales in the local area is that the Pathway to Purchase program is going away. Jeffrey Hale, a Realtor at Turf Realty in Phoenix, said the program has helped a lot of first-time buyers in South Phoenix and Laveen gain financing for their first home.

“With that gone, it’s not going to be as crazy as it was,” Hale said. “We had multiple people bidding on houses in the 85339 area.”

He predicts a more normal rate of growth for 2017 as foreclosures have tapered off to a small steady number. “Housing prices going up is a good thing. The housing prices in this area were way too cheap for a long while.”

All four realtors say it is difficult to predict how politics and a new president will play into the housing market. “Politics are a huge ‘wait and see’,” Hale said.

Nationally, Phoenix is predicted to be the top housing market in terms of growth and sales price, according to Realtor.com, a web site that tracks and analyzes data nationwide.

In its annual year-end article predicting what will happen in the coming year, Realtor.com said that strong local economies and population growth will continue to fuel the hottest markets.

The Realtor.com 2017 top 10 housing markets based on price and sales gains are: 1. Phoenix-Mesa-Scottsdale, Ariz.; 2. Los Angeles-Long Beach-Anaheim, Calif.; 3. Boston-Cambridge-Newton, Mass.-N.H.; 4. Sacramento–Roseville–Arden-Arcade, Calif.; 5. Riverside-San Bernardino-Ontario, Calif.; 6. Jacksonville, Fla.; 7. Orlando-Kissimmee-Sanford, Fla.; 8. Raleigh, N.C.; 9. Tucson, Ariz.; and 10. Portland-Vancouver-Hillsboro, Ore.-Wash.

This dovetails with Gould’s local predictions, too, especially as new home construction is popping up again all around the area. “This shows that we have a strong housing economy, and that we are still on track for a very strong market in the next few years,” Gould said.

Here are some breakdowns by ZIP code:

(Laveen) 85339

The average sales price of homes sold in Laveen rose 8.9 percent over 2015, going from a 2015 average of $198,700 to $216,400 in 2016. The number of homes sold also increased by 106 completed sales. Houses priced in the $200,00 to $250,000 range saw the most sales activity during 2016, accounting for 311 of the 980 homes sold during the year.

The month of December 2016 showed a reduction of 5.4 percent in number of closed home sales but 9.5 percent growth in sales price compared with 2015. Lawmaster said this may be an indicator of sales prices beginning to flatten as supply outpaced demand year over year. For comparison, the number of homes sold in December 2015 compared to 2014 had a massive 73.6 percent increase accompanied by a 13.5 percent expansion in sales price.

Based on statistical averages and means applied to data from ARMLS, the average home sold in Laveen last year had 2,150 square feet, 3 bedrooms, 2 baths, was one story, had no pool, sat on a 9,746 square feet lot. The most active subdivision was Laveen Farms, and most homes sold had Betty Fairfax listed as the high school.

South Phoenix 85040

During 2016, the average home in 85040 sold for $132,500, up 12 percent from 2015. Sales activity also increased year over year with 354 homes sold, a 10 percent gain. It took an average of 42 days to sell a home in 85040, a decrease of 3 days from 2015, reflecting higher levels of buyer readiness to make a purchase. When comparing the month of December between 2015 and 2016, the monthly average sales price and volume were flat, with average price gaining 1.2 percent and volume of closed sales remaining the same with 26 closed sales in December of both years.

The average home in 85040 sold during 2016 was single story with 1,375 square feet, 3 bedrooms, 2 baths, no pool, and an 814 square-foot lot. The most commonly occurring subdivision was Copper Leaf. There are several condominiums in the Copper Leaf subdivision and some smaller properties in the popular Hallcraft Villas subdivision that contributed to the average home sold in this ZIP having smaller attributes.

South Phoenix 85041

This South Mountain zip code saw increases in sales and list prices during 2016, but was flat in sales and listing volumes. The average sales price in 85041 increased 13.6 percent over 2015 to $187,400, while the average list price gained 15.3 percent year over year to $211,600. The busiest price range for both sales and listings was $160,00 to $180,000 with 209 sales and 244 listings.

During December 2016, 59 homes were sold, dropping 14.5 percent from 2015 which had 69 closed sales for the same time. The average sales price for the month, however, increased year over year to $186,200, a gain of 9 percent. “Like Laveen, the decoupling of sales price and volume may indicate a flattening of sales price soon. When you compare Decembers for 2015 and 2014 in 85041, the growth of sales price and volume were in lockstep,” Lawmaster observed.

The average home in 85041 sold during 2016 was a single-story with 1,906 square feet, 3 bedrooms, 2 baths, no pool, and a 7,920 square-foot lot. The most active subdivision was Barcelona.

South Phoenix 85042

This was a strong ZIP code for sales price and volume during 2016. There were 604 homes sold with an average sales price of $214,000, seeing increases of approximately 13 percent in both sales volume and price from 2015 to 2016. It took 58 days on average to sell a home in 2016, 8 percent less time (5 days) than in 2015. The month of December saw a disconnect between sales volume and price. There was a 31 percent gain in homes sold during the month compared to 2015 (59 vs. 45), but an 8 percent decrease in sales price, dropping $18,00 on average between the two December reporting periods.

The average home sold in 85042 during 2016 was single story with 1,743 square feet, 3 bedrooms, 2 baths, no pool, and a 4,950-square foot lot. The most commonly occurring subdivision was Raven Condominiums. “The fact that Raven Condominiums was the most common subdivision may have skewed some of the average home’s attributes downward, so keep that in mind when visualizing this imaginary home built by statistics,” Lawmaster said.

 

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  1. […] This article first appeared in the February 2017 print edition of the South Mountain District News. […]



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