Today’s headline in the Arizona Republic was Find Out What Your Home Is Worth Now. I’ve been sick of the Republic’s "How much has your home appreciated?" for months, where the Republic compares 2004-2005 price gains, even though we approaching 2007. "Finally," I thought. "We’re having a reality check." After all, Phoenix median home price dropped 2.54% year over year in September, so the Republic is going to have to start reporting prices going down.
I know, I know. I’ve been doing this long enough, I should know better. The Republic has a number of articles today dealing with the Valley real estate market. While it’s true the articles talk about cooling and corrections, in the end they have the most interesting (?) map of the Valley. Somehow when the Valley experienced a year over year decline- this map doesn’t show one zip code declining in the Valley! It would be impossible using the chart headings they have. How do you report negative appreciation with these options: (If you don’t have today’s Republic, I’m sorry I’m not finding a link to the map- does anyone else see it?")
-25% or more
-20 to 24.9%
-15 to 19.9%
-10 to 14.9%
-less than 10%
Apparently negative is "insufficient data." (the chart they give at the bottom only shows Waddell and Youngtown being negative.)
I decided to compare Jay Butler’s monthly report from October 2006, and compare it with the median prices he gave for 2005. I took that percentage, and compared it with the percentages given in the Republic. Butler’s report does not cover all Valley communities, but here are the one’s that didn’t show positive appreciation (AZ Republic’s report is by Zip Code. For communities with multiple zip codes, the range is given here.)
There are a number of articles in today’s AZ Republic like Standoff in Phoenix Housing Market. It mentions Most Valley ZIP codes posted double-digit price increases for the first eight months of 2006. A few areas even showed bigger price gains this year than last. I wonder why they didn’t use the ninth month of the year, when the Valley went negative? I’m also wondering, who in heck is this "Information Market," who supplies the Arizona Republic with this data? They are the guys that bring us "How much has your home appreciated?" every week.
One of the more irritating articles is Resale Home Prices Up More than 10% in SE Valley. The first sentence states, Home prices are climbing, while sales are falling around the southeast Valley. If you check Jay Butler’s October report, you will see that this claim is an outright boldfaced exaggeration. Holding Off on Buying the American Dream was a better article today. It talks about a new move in to the Valley who is waiting on buying. More First Time Buyers Put Less Down is a little scary. So is the 40 to 50 year mortgage article. Here’s a list of all the housing articles in today’s Arizona Republic, all of varying worth.
Another annoying article from today’s Republic has no link, but reads, "Appraiser Looks back 6 Months."
Question: What is wrong with my neighbors? They’re selling their house, and their asking price is far below recent "comps" in the neighborhood. Doesn’t this hurt my chances of selling my house at a good price next year?
Answer: Realtor Neil Brooks of Century 21 Arizona-Foothills says: "If you’re not going to sell your home until next year, you have nothing to worry about. [?] An appraiser will go back no more than six months to find valid comparables. Appraisers will often call the listing agent of a past sale to find out why it sold so low/high when they’re doing an appraisal on a current comparable sale, and then make adjustments.
"Sellers price their home based on their motivation to sell, and market conditions. Your neighbor may be making a strategic pricing move knowing that with holidays coming up, there are only about eight more weeks left to sell this year.
"Pricing the home to attract the most buyers is a good strategy in a soft market. Higher priced homes may sit on the market through the end of the year. Then sellers will be forced to drop their price to the same price or lower than what your neighbor is asking.
"I have seen a definite increase in both contracts and activities in the past month. These are all very positive indicators and could be a signal that we’ve hit bottom." [emphasis mine]
And on that note, I’m going to go grab something to eat. I’d like something else besides baloney for breakfast.