Phoenix leads nation in home price increases
The latest report from Standard & Poor’s/Case Shiller home-price index shows that real estate in Phoenix has shown the largest year-over-year gain of the 20 metro areas covered. According to the report, home prices rose 2.2 percent between June and July and rose 16.6 percent in July year-over-year. Between May and June, home prices went up 2.5 percent.
Phoenix has been fighting back with a vengeance after being one of the hardest hit cities in the country during the housing burst. According to Forbes, although many homes that are being sold come from the distressed category - meaning short sales and foreclosed homes - median home prices are much higher than they were a year ago. In the past 12 months, prices have soared 25 percent. Playing a key role in the trend, inventory for homes is down nearly 30 percent and the median selling time on homes is 48 days.
Homes that are in the lower price range seem to be gaining more momentum that those in higher price brackets. Reports show that homes priced around $200,000 to $250,000 are only on the market for a short time span, compared with homes in higher price ranges.
A report released by CoreLogic found that foreclosure activity continued to drop throughout the whole summer at a rate that outpaced the rest of the nation. In July, the rate of properties in the foreclosure process was 2.18 percent, which includes all outstanding residential mortgages that are in a stage of foreclosure. This shows an 8 percent decrease from June, and a 39 percent drop from last July’s 3.57 rate. The statewide rate in July was 2.11 percent, which is a 34 percent year-over-year decline during the same time.
The state’s mortgage delinquency rate is improving as well, showing that fewer homeowners are underwater on their payments. The delinquency rate measures the percentage of homeowners that are 90 or more days behind on their mortgage payments. The area looks better than the entire nation at 6.71 percent for July, compared with 5.36 percent in Phoenix.
However, a report released by Case-Shiller in August predicted that prices would sharply decline by early 2013. According to the report, Phoenix home prices are expected to fall 9.5 percent during the first quarter and remain stable throughout the entire year. This drop is predicted as the third-largest in the nation following Detroit and Naples, Florida.