The Phoenix-area’s real estate market seems to be continuing its slow trek back to normalcy. Home prices were essentially unchanged on a fairly strong volume of sales in the September edition of the BloodhoundRealty.com Market-Basket of Homes.
Average prices for Market Basket homes in September were down 0.15%, compared to August, a difference of $372. Year-over-year, prices are down 3.15%, and down 6.05% from the December 2005 high.
A total of 183 sales were recorded, down from August’s total of 199. Market-Basket homes spent an average of 100 days on market, 22 days more than in August. For comparison purposes, 192 Market Basket homes sold in September of 2003, the last relatively normal year, in an average of 58 days.
As has been the case in recent months, most Market-Basket homes are selling at or above list price. A few deeply-discounted properties pulled down the average — most notably builder’s spec homes deeply discounted to close before the end of the third fiscal quarter. Average discounting netted out to 2.03%, up from 1.43% in August.
Inventories of available Market Basket homes continue their decline. There are now 1,337 homes available for sale in the Market-Basket, where there were 1,406 in August and 1,506 in July. With sales of 183 homes, the implied absorption rate is 7.31 months, up from slightly over 7 months in August, but down significantly from almost 10 months in July. A six-month absorption rate is considered normal. The number of homes listed as “Sale Pending” is 165, down from 179 in August.
Based on the idea of the Consumer Price Index market-basket of goods and services, the Market-Basket of Homes uses average sales prices for a small subset of all Valley home sales to get a clearer idea of what is happening in the middle of the bell curve. The alternative method, striking a median among all closed transactions, introduces too many extraneous factors to provide a reliable indicator of what is happening to prices for those homes that are most avidly desired by the greatest number of people. To that end, the Market-Basket of Homes looks at sales prices for MLS-listed suburban homes from 1300sf to 1900sf built in 1998 or later, the homes that drive the resale market.
The BloodhoundRealty.com Market-Basket of Homes is updated monthly and is always available at http://www.BloodhoundRealty.com/MarketBasket.pdf.
Later today, I’ll post a snapshot of the overall market for MLS-listed homes…
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