Many Arizona real estate investors purchased properties in Pinal County. Here is an update that these investors will find interesting.
Pinal County resale housing market experiences declining prices
MESA, Ariz. — Of the 2,100 recorded resale transaction in second quarter 2008, there were 845 foreclosures or 40 percent of the resale activity. For the first quarter, there were 785 foreclosures of the 1,680 recorded transactions or 47 percent.
Although recorded foreclosure activity slowed in the second quarter, it still represented a dominant segment such as a 48 percent share in Maricopa and 42 percent share in Queen Creek. Maricopa County reported 21,445 recorded sales in the second quarter with foreclosure activity representing 41 percent of the recordings.
“In Pinal County, there is a wide range of homes available, from the listed homes to foreclosures, but a key force driving the sales activity has been the rapidly declining prices,” said Jay Butler, director of Realty Studies at Arizona State University’s Morrison School of Management and Agribusiness at the Polytechnic campus. “Homeowners and investors are buying with the expectation of strong appreciation in the future.”
For all transactions, the median price has steadily eroded from $220,000 in fourth quarter 2005 to $193,000 in third quarter 2007, to $143,100 for the current quarter. The foreclosure median price was $145,000, while the traditional transaction was $141,000.
The median home price in Pinal County was 72 percent of the median price in Maricopa County ($200,000). Although the 30-year mortgage increased from 5.9 to 6.1 percent, a lower home price drove the monthly mortgage payment for the median price, based on an 85 percent loan-to-value, to decrease from $1,010 to $735. It would be $1,030 for the median priced home in Maricopa County.
Although affordability has improved, higher gasoline prices, more congested highways and limited employment opportunities continue to strongly hamper any potential recovery of the housing market in Pinal County. In order to reduce inventories, new home builders are still aggressively pursuing buyers through incentives such as specially priced upgrades, free pools and gift cards. The new home has become a strong competitive and attractive alternative to the resale home in Pinal County. New home sales were 1,925 homes with a median price of $167,690, in contrast to last year’s 2,425 sales and median price of $201,885.
The median square footage for a resale home in Pinal County was 1,830 square feet, while it was 1,780 square feet in Maricopa County.
Courtesy of ASU Realty Studies
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