Phoenix market evens out, still shows year-over-year gains
The number of homes sold in the Phoenix area in July 2012 was similar to numbers seen in previous years during the same month. Real estate in the lower end market has continued to decline sharply, while home sales in the $200,000 to $600,000 price point skyrocketed. The number of foreclosed homes in this market's metro area also dropped to the lowest point seen in nearly five years, according to DataQuick.
Real estate in Phoenix in July saw a 1.3 percent decrease in median home price compared with June, but showed a 25 percent gain over July 2011. This marked the eighth consecutive month with year-over-year gains in the market. There are several trends that have accounted for the year-over-year gains in the median sale price. For instance, there is now major pressure on home prices due to increased demand and ultra-low mortgage rates. However, some experts believe that if lenders move aggressively to clear the backlog of distressed properties, also known as shadow inventory, the amount of homes on the market would successfully meet the demand.
Experts believe the market will respond with a large supply of homes in the near future. With the rental market in despair in Phoenix, many people that can afford to purchase a home should take advantage of the quickly-turning market. Renters are having issues finding apartments and homes, while some that live in rentals are experiencing challenges with landlords who cannot afford to maintain properties.
For example, the residents of the two-story apartment complexes on the corner of 19th and Glendale Avenues, for instance, have gone days without running water or air conditioning, the Arizona Republic recently reported. Tenants at the complex have complained to the city about the issues and inspectors wrote up 46 civil citations for units lacking air conditioning. After the property manager refused to let inspectors look through the entire property, limiting them only to the apartments where tenants invited them in, the city took action to receive a search warrant. Inspectors later found 359 violations in the building.
"I've been with the city for 28 years, and I've seen a lot of properties in disrepair," Tim Boling, deputy director of the Neighborhood Services Department told AZ Central. "On a scale of 1 to 10, this is about an 8 as far as conditions."