Phoenix-area foreclosure rate slightly back up
For only the second time this year, the monthly foreclosure rate has gone up in the Phoenix area. According to a new report from the W. P. Carey School of Business at Arizona State University, foreclosures made up 29 percent of the existing-home transactions in the market in November. That’s an increase from 26 percent in October, but the report’s author assures it’s not significant.
“Nothing like this goes down smoothly,” says Jay Butler, professor emeritus in the business school. “The foreclosure rate’s movement is more of a cha-cha-cha, with a few steps forward and couple of steps back. Most people thought 2011 would be a better year for the housing market than it was, but it’s a good transition year.”
Since January, Phoenix-area foreclosures have decreased from 43 percent of the existing-home market transactions all the way down to 29 percent in November. The drop was interrupted only by relatively small increases in August and November. Overall, Butler anticipates that foreclosures will continue to drop in 2012.
“I think we’re on our way out of this mess unless something major happens,” says Butler. “We might see another surge in foreclosures in the spring after holiday foreclosure moratoriums by banks end and low consumer confidence possibly prompts more people to give up on their homes. However, the key issue in the coming year will be whether investors become less of a factor and the homeowner-occupant market begins to improve.”
The Phoenix area had about 2,100 foreclosures in November, up from 1,900 in October, but almost identical to the number from November of last year. Overall housing-market activity remained about the same in October (about 7,200 transactions) and November (about 7,100 transactions).
The median price for single-family homes resold (not new foreclosures) in the Phoenix area in November was $130,000. That’s up from $125,000 in October, but still down from $134,000 last November.
The townhouse/condominium market had 260 foreclosures in November, about the same as the 265 in October. The median price for a townhome/condo resold in November (not new foreclosures) was $80,900. That’s slightly up from $79,125 in October and an increase from $75,000 last November.
Butler’s full report, including statistics, charts and a breakdown by different areas of the Valley, can be viewed at http://wpcarey.asu.edu/finance/real-estate/upload/Press-Release-November-2011-resale-homes.doc. More analysis is also available from knowWPCarey, the business school’s online resource and newsletter, at http://knowwpcarey.com.