Just How Ugly Was July for Tucson Real Estate Sales?
August 30, 2010
Remember how I told you July was an ugly month for Tucson real estate sales? Let’s look at this a different way.
This compares the number of sales per price bucket for every July since 2007. You can just see the purple 2008 bit peeking out between 2007 and 2009.
Couple things pop out at you, immediately. First, see how the bulk of the home sales have shifted over time? There has been a big shift in average home prices in Tucson in the past 4 years. The less expensive homes are the ones that are selling.
The other thing to notice is the difference in the volume of sales, period. That tiny little light green front shape represents the number of sales in July in 2010. That big blue shape behind it is the number of sales in July 2007. Not only have prices changed significantly, so has the volume of homes selling.
Granted, July 2010 was an ugly month for Tucson homes. But August is almost always worse than July, seasonally. We’ll find out by the end of the week…
How’s the Luxury Tucson Home Market?
July 9, 2010
I showed this enormous home yesterday up in the Tucson foothills. I mean, HUGE. At some point, it just gets silly. When you approach 10,000 square feet with an indoor pool, well, I think you’ve reached that point. But then again, I’m not a house-as-status-symbol kind of gal. Other people have the funds to do that kind of thing, so more power to them.
This particular home is around $900k and is bank owned. My client and I were touring the house and started talking about what it might have sold for back in the crazy days 5 years ago. The house has been listed as high as $3.4mil – at which price it didn’t sell. The price went down and down since then, and finally the bank foreclosed mid 2009.
So how many high end Tucson homes are selling these days?
Not many, turns out.
- In 2005, there were 356 homes sold over $800k.
- In 2009, there were only 141 homes sold over $800k.
- To date this year, there have been 76 homes sold over $800k.
With an average of 12ish homes selling a month and 377 homes listed over $800k, that’s about 31 months of inventory. Not a pretty market segment to be in if you’re trying to sell. Of course, if you’re trying to buy a high end home in Tucson, you’ve got choices aplenty…
Finding the Bottom of the Tucson Real Estate Market
June 25, 2010
Got a call the other day from someone trying to find the exact right time to buy a home here in Tucson – at the bottom of the market.
Thing is, you never know when bottom is until you’re well past it. As I’ve illustrated very scientifically here:
We like to think that property values move like smooth charts. But they don’t. There are lots of variations, up and down, fast and slow, that all contribute to an overall smoothed line made from averaging lots of data points. So when you’re in the middle of the bottom, things are still fluctuating. You never know when you’ve really pulled out of it until you’re sure all the fluctuations are over. And that’s something you can only see when you look well behind you and backwards in time.
You can try to purchase at generally the low point in the market, but the only way you’re going to buy at exactly market bottom is through sheer luck.
That being said: what good is a post about the Tucson market bottom without a peek into my crystal ball?
Best guess, in my humble opinion: we have a bit further to fall. Not nearly as much as we already have, but a bit more, and most likely this fall and winter. I don’t like the trends I’m seeing so far this summer. Inventory levels didn’t fall the way one would have hoped, and while sales are still high, they’re peaking way too early due to the expiring tax credit. So I’m betting small dip over the next 6-8 months, and the start of a long, slow, and highly unstable recovery starting early 2011.
What does your crystal ball say?
Point of Clarification – List Price vs Sale Price charts
May 21, 2010
Point of clarification.
The list price vs sale price charts (for Northwest Tucson as an example) for Tucson display the average sale price for the area and the average list price of *all* homes for sale in the area. Not the average list price of the homes that sold. So when you see the average list price at $353k and the average sale price at $257k, that doesn’t mean a home listed at $353k sold for $257k. That $353k value includes all of the high priced listings in the area that didn’t sell that month.
Perhaps I should change this…
Understanding the ‘Zestimate’ and Tucson Home Values
April 16, 2010
Zillow has a really cool iPhone app. More and more of my clients are using that as we shop for homes, though those of us on Blackberrys are out of luck.
As nice as that app is, it isn’t the ultimate answer on home values here in Tucson. My friend Kris Berg in San Diego wrote a post recently on her blog where she dives deeper into the ‘zestimate.’ If you’ve been looking at home values via Zillow, I highly recommend you stop and read her post now.
Go ahead. I’ll wait.
Basically, that zestimate comes from an automated system, that hopefully should improve in accuracy over time. Areas with high turnover and very similar houses will enjoy much more accurate zestimates. Areas with lower sales rates and dissimilar homes won’t have nearly as accurate valuations.
In fact, Zillow publishes a chart of their accuracy. Here’s Arizona:
In Pima County, where Tucson resides, it says that 20% of the homes sold within +/-5% of the zestimate. 40% of homes in Tucson had a sale price within +/-10% of the zestimate, and 66% were within +/-20%. The median error is 13.2%
In other words, when you look at a zestimate in Tucson, the actual home’s value is likely to be within +/-13% of the zestimate.
So if the zestimate on your home is $200,000, they’re saying actual value is likely between $173,600 and $226,400, according to the data they’ve collected and analyzed so far. Which is pretty good accuracy for an automated system…
…and terrible accuracy if you’re a human and can understand the nuances of home values and better pick out similar sold homes based on condition and location. If your agent is pricing homes within 26% of value? Time to find a new agent.
Arizona Agents Rate the Market
December 2, 2009
I’ve started participating in a monthly market survey from the Arizona Association of REALTORs. I look at a lot of data, compile monthly numbers myself, and figured that since I know the Tucson real estate market, I’d be a helpful association member and start taking the survey.
After I completed the survey, there’s an option to look at the answers of everyone else. I must admit, I was a little surprised how other Arizona agents answered the questions. Here’s the results, of 125 responses:
| Current | Weak | Stable | Strong |
| Residential Sales | 42% | 45% | 13% |
| Residential Listings | 26% | 53% | 22% |
| 6 Month Outlook | Declining | Stable | Improving |
| Residential Sales | 16% | 38% | 45% |
| Residential Listings | 16% | 48% | 35% |
What do you think? I’m not sure I agree…
Home Prices near the University of Arizona
November 16, 2009
Got a question from a reader the other day about home prices near the University of Arizona. In my October 2009 Market Report, I looked at how quickly home prices were decreasing per month, on average. A reader asked me how the University area compared.
So. If we look at the region between Stone and Country Club, Grant Road to Broadway, single family homes only, we find that the average home sales prices are:
2009 to date: $267,656
2008: $272,992
2007: $307,299
2006: $313,649
2005: $296,582
2004: $246,315
If we compare to Tucson area statistics, you can see the University area has higher average sales prices in general than the rest of Central Tucson. This area includes some in-demand neighborhoods though: Sam Hughes, Blenman-Elm, West University – that tend to hold their value well.
And like the rest of town, 2008 was a rough year for the average sales price. In 2009 to date, we’ve had a much more moderate decline.
Will Mortgage Rates and Home Prices Continue to Decline in Tucson?
November 2, 2009
Question from the blog today – will rates and home prices keep going down?
Answer – depends on what time period you look at.
Let’s start with home prices. Will they continue to go down over the next month? Most certainly. Over the next year? It’s likely. Over the next 5 years? Maybe not. Over such a long term, there’s no way to accurately predict.
If you look at the average sales price for homes in Tucson over the last few years, you can see the decline. I’d argue that the drop in home prices is slowing a bit, but there are several factors in play that could make that change – the availability of financing, the levels of inventory, the economy as a whole impacting salaries and the ability to buy and sell a home.
If we look at mortgage rates, there’s some seasonality there too. I talked about that earlier in this post about rates going up or down. History says rates go down in the fall. But again, there are larger factors at play.
AND – rates are changing rather quickly, as Dan points out in this article about how long a rate quote lasts over the past 2 months. Lenders are changing their pricing often, which changes your rate often.
So why ask if rates and prices will continue to decline? Trying to time the market, buy at the best possible price and rate? I guess you can try. But you’ll never know if we’re really at bottom until we’ve already left it. It’s all just part of the risk you take by deciding to buy or sell at any particular time.
Tucson Distressed Housing Market – Sales by Type and Area
September 17, 2009
I was curious today to know exactly how much of our market was distress sales. So I bring you the extra lovely chart, below:
By area of Tucson, this shows you what percent of sales in that area are short sales, REO properties (foreclosed homes sold on the resale market), and what percent were regular sales. This includes all sales from 8/1/09 to today.
Clearly, the REO market is larger than the short sale market – at least in terms of sales that are actually closing. Regular non-distress sales still are a large portion of the market in some areas – but check out the South. Well over half of the sales in South Tucson are distressed properties of some kind.
Citywide, by the way, that makes our market 10% short sales, 28% foreclosed properties, and 62% regular properties. Now that the Tucson MLS has added a short sale and REO property flag to listings, these numbers ought to be quite a bit easier to track.
Tucson Real Estate Market Overview – Fun with Charts
September 2, 2009
I don’t know if you’ve seen this chart that I’ve got over on the home page of Housechick.com:
This is one of my favorite market charts that I maintain. You get the whole story of what has happened to the Tucson housing market in one glance.
The black bars show months of inventory, or absorption rate. Basically, the months of inventory is the rate at which homes are selling, the speed of the market. You calculate months of inventory by dividing the number of homes available for sale by the number that sold. So if there are 5 months of inventory, it means that if no other homes come on the market, at the current rate of sales, it’d take 5 months to sell all those homes.
Generally, anything around 5-6 months is considered balanced – buyers and sellers have equal power. Anything under 4 months or so is considered a Seller’s market, and anything over about 7 months is a Buyer’s market. The higher the number, the slower the market, generally.
The yellow line is the citywide average sales price, as I calculate it. Which means it includes only the 9 major regions of Tucson, single family homes, town homes, and condos only.
See down there on the left hand side back in 2005? Back when the supply of homes was so low that we had 2 months of inventory some months? Look what that does to the average sales price – lack of inventory and high demand leads to higher sales prices. And you can see the whole market shift over the next few years. As inventory levels rise, average sales prices start leveling out, and then dropping as inventory shifts yet higher.
So where are we now? Well, inventory has been dropping. Over the last 3 months, the average sales price has been going up ever so slightly. But we were also seeing that happen over summer, which is our high selling season anyway. Will it all hold as we head into winter? Only time will tell for sure.
- About Tucson (48)
- Bank Owned Homes (3)
- Canadians and Tucson (2)
- Central Tucson (6)
- East Tucson (6)
- First Time Buyer (30)
- Home Buying (114)
- Home Selling (65)
- Homeowner Associations (7)
- Loans and Financing (46)
- Market Discussion (18)
- Market Reports (51)
- North Tucson (6)
- Northeast Tucson (6)
- Northwest Tucson (7)
- Odds and Ends (71)
- Purchase Contract (4)
- Relocating (9)
- Repair Renovate Maintain (21)
- Restaurants (14)
- South Tucson (6)
- Southeast Tucson (6)
- Southwest Tucson (6)
- Top Ten (3)
- Tucson Events (36)
- Tucson Foreclosures and Short Sales (14)
- Tucson Homes Explained (32)
- Tucson in Photos (4)
- Tucson Land (5)
- Tucson Neighborhoods (20)
- Tucson New Construction (2)
- West Tucson (6)
