ASU Realty Studies has released its most recent report (PDF), authored as always by Dr. Jay Butler. Butler indicated that foreclosure activity was “only” 38% of the market, as opposed to the 43% posted in February. Here’s what Butler said about the drop:
Because the change is so slight, the fundamental uncertainty remains as to whether the initial months of 2011 represent short-term response in unclogging the pipeline after the moratoriums or a continuation of a market being dominated by foreclosures.
For those of you who might also be wondering if the market will remain dominated by foreclosures, you might want to check out this foreclosure map that M sent me yesterday. [Gavels indicate pending foreclosures.]
The map shows an area of my old stomping grounds in Gilbert, AZ, in the Phoenix southeast valley. The vast majority of the properties shown here were built during the housing boom.
I would say that if the pipeline is now “unclogged”, it remains extremely full, and unlikely to run dry any time soon.
On another note, Butler also reported that the median price for the Phoenix metropolitan dropped from $142,500 last March to $125,000 this March, a drop of $17,500 YOY. Many buyers last year decided to take advantage of that fabulous $8,000 tax break the Obama administration was offering. How do you suppose that’s working out for them?
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The tax break was a huge help for many people and will monitor the market. There was a drop in real estate prices
Thanks for sharing
They got an $8,000 break and lost $17,500 on average? I wouldn’t call that a “huge help” – unless, of course, you meant a huge help encouraging more people to provide interest income to the banks.
That foreclosures map is quite amazing. How many years do you think Gilbert will take to recover from such a mess – or is such a recovery now impossible and the whole place will slowly turn into another Flint, Michigan?
Alex-
The deciding factor is going to be jobs. You’ll note that it was a lack of jobs that did in Flint. [That said, the weather in Gilbert is a LOT nicer than it is in Flint.]
Back in 2005 there were a lot of reports in the media that said one in four dollars generated in the nation was related to housing, but for the Phoenix area, it was one in three. Basically “moving to Phoenix” became one of the Valley’s leading industries– clearly not a plan that go on forever.
So far, I haven’t seen that Arizona’s policies will lead to more jobs. So far, they keep trying to rebuild the world of 2005, and that world isn’t coming back.
I’m keeping my fingers crossed that the economic mess will sort itself out, and that Gilbert rises again. While I like the area here in Austin, I’d love to move back home.