I suspect two things are about to happen:

1) You’ll see a post about this on virtually every Phoenix real estate blog and an article in every local newspaper. (Probably already happening, I haven’t read anything today)

2) The mainstream media (MSM) will minimize if not ignore the good and highlight the bad. (I know, what a shocking prediction.)

The What: ASU’s Realty Studies has released its report for April’s real estate activity in the Phoenix area.

The good news: For the first time since July 2005, resale homes have posted a year-over-year (YOY) improvement.

Dr. Jay Butler, Director of Realty Studies reports there were 5,585 recorded sales in April. April 2007 recorded 4,855 sales. (4,335 in March 2008)

I’m not personally as enamored with YOY stats as many. I prefer to look at month-to month trends. I don’t quite get what is so special about looking at this month compared to 12 months ago — without looking at everything else in between. The media however, seems to love YOY numbers (particularly when they are declining).

What the MSM will likely focus on: The median Phoenix home price declined from $220,000 in March to $210,000 in April. Last April’s median value was $265,000.

From Butler:

“One of the driving forces in increased activity has been rapidly declining prices that have fueled renewed investor interest and potential owner-occupants, especially in the lower income ranges,” said Butler. “Investment interest is being driven by the anticipation that home prices will rise again in the next few years. The lower median price is being impacted by several factors, including the large number of vacant homes, especially in certain neighborhoods,” he said.

Telling numbers in the foreclosure market:

Last year, 41 percent of the resale homes sold for more than $300,000, while it was 24 percent for April 2008. Influenced by foreclosed properties, homes selling for under $200,000 have increased from last year’s 16 percent to a current 44 percent of the local resale housing market. The most evident impact of lower prices is improved affordability.

This certainly reflects what we are seeing. Foreclosure and short-sale listings in some areas of Phoenix (particularly outlying areas) account for 35% of the inventory.

Sellers seem to generally be understanding that they can not base their home value on what the neighbor got last year. Buyers on the other hand do not seem to be understanding that they can’t get short sale and REO (bank owned) properties for 50 cents on the dollar. REOs are moving — sometimes swiftly and with multiple offers at (or even above) the banks listing price. Short sales are typically not moving, and they swiftly become REOs in the vast majority of cases.

Beginning of a recovery? One time blip? Who knows. One YOY data point does not a trend make. But sales seem to be picking up steam, foreclosures are creating affordability, and absorption rates are falling. All of this seems to indicate we may be bottoming. The question once that officially happens is, how long will it last? No one knows. As I’ve said before, you can never truly call the bottom unless you’re looking behind you saying, “Yep, that was the bottom…”.

See the full report for specifics on different parts of the Phoenix metro area.

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U.S. News & World Report writer Luke Mullins let me know he’d written an article titled 5 Tips for Selling a House in a Slow Market. It’s a good read, especially for home sellers in Phoenix (and other “slow” markets — of which there are many).

Mullins’ five tips are (basically):

1. Make repairs
2. Price appropriately
3. Use an experienced agent
4. Make your home available for showing (a pet peeve)
5. Counter “low ball” offers

Nothing earth-shattering here, but it is all sound advice (read the article for more details).

My only real disagreement with what Mullins writes is in his “Know you agent’s stats” tip. While experience in the market certainly helps, there are specific time frames listed in the article that may or may not be appropriate for every situation. A blanket statement such as “It’s best to choose an agent whose properties sell in an average of three or four months, a time frame that indicates the agent understands how to price the market” isn’t always going to be correct.

If you are trying to do a short sale for example, picking an agent that has a low days on market stat but no experience in short sales is a big mistake.

If you are selling a luxury home in Phoenix, where time on market is typically many, many months, finding someone whose properties sell in 3 or 4 months likely won’t help. Reality is, it will probably hurt.

Agents tend to specialize — in location, price range, style, niche market or some combination. It’s an over-generalization to say, “An agent whose average is X months is too long”. To regurgitate an oft-overused (but accurate) term, all real estate is local. Sometimes down to the subdivision.

I’ve said it before, but homes are still being bought and sold every day. Sure, the numbers are lower, but if you need to sell, applying these general tips can clearly help. Yes, Phoenix is in a “buyer’s market”, but that doesn’t mean a home can’t be sold. After all, for every home bought, by definition one is sold….

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When Jay Butler Director of ASU’s Realty Studies Center releases and comments on data, the mainstream media jumps.

Catherine Reagor of the Arizona Republic reports in “Home Sales Up but still Sputtering”, and Misty Williams of the East Valley Tribune has a more positive spin writing, “Home Sales Rising so far this Year.”

The gist of ASU’s report is that home sales have climbed steadily this year, but are still depressed from a year ago. Whether this is a typical seasonal pick up, or the beginning of a market shift, only time will tell. 

ASU reports 4,335 existing homes were sold in March, up 15.6% from February. But the March 2008 numbers are down 19.5% from March 2007’s 5,385 sales and are the lowest March numbers since 1996 (with 3,270 sales).

The good news from the study is that the median existing home price in the Valley was flat at $220,000. 

So, it’s a mixed bag. While everyone would like to see prices rising, in our current market, prices not declining is a good and fairly novel thing.

Reagor did write:

If home sales climb again this month from March’s level, and home prices don’t fall again, it could signal the housing market has hit bottom.

Lots of “if’s”, “and’s” and “could’s” in there, but it is true. And as I said in the Tribune article, I think we’re near the bottom of the pricing decline.

I do of course, reserve the right to be wrong about that. Misty left out the “I don’t have a crystal ball” part…

And if I may rail a moment on the mainstream media (like that’s never happened before…), I find it annoying that neither the East Valley Tribune, the Republic, or the Phoenix Business Journal linked to the source of the ASU data. I searched the ASU Realty Studies home page and found nothing on 2008 numbers. How hard would it be to put a link in an online article? If anyone has the actual data, I’d love to see it.

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The Wall Street Journal posts some cool interactive maps on the housing market. The latest is homeowner vacancy rates. Click on the link or map above to go to the WSJ map site.

Vacancy rates are trending up in many metro areas — a trend some economists say can lead to further price declines. More from the Wall Street Journal Developments blog.

Here are some more WSJ housing data interactive maps. Click on the thumbnails…

Technorati Tags: Mortgage rates, mortgage delinquency, subprime, interactive maps

One does not have to dig very deep to find the mainstream media reporting on the woes of the housing market.

I’ll be the first to admit the current Phoenix market is not in the greatest of shape:

There are a ton of short sales out there. 

It may not be a good time to buy a Phoenix Home (but, maybe it is)

Local economist says Phoenix real estate market will take 3 – 5 years to recover.

However; there is evidence, albeit anecdotal, that there are signs of life in the Phoenix market.

Our phone has been ringing off the hook recently — with serious buyers (and sellers) on the other end of the line. Email inquiries have increased in quantity and quality as well.

Apparently I am not alone in seeing increased activity. East Valley Tribune reporter Misty Williams ran a piece on Saturday, quoting a couple of my Phoenix real estate blogging buddies:

Dru Bloomfield:

“I’ve been seeing an increase in first-time buyers - people who have saved their money and ridden through the wave of escalating prices,” (Great pic Dru! )

John Wake:

“. . . calls from interested buyers have at least doubled in recent weeks.”

Over on the west side of the Valley, Jonathan Dalton just released some absorption rate data that show an increase in sales as well (hence a resulting decline in absorption rate in some areas of town).

While we are by no means clear of a messy housing market, there are some positive signs of change happening. Only time will tell if it continues, but hey, at least it is a start…

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Technorati Tags: Phoenix real estate market conditions, buyer activity