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Pinal County resale housing market continues with decline trend


November 01, 2007

MESA, Ariz. — Due primarily to the holidays and the desire not to move children during a school year, recorded sales for resale homes tend to weaken in the third and fourth quarters. This traditional trend appears to be evident in Pinal County with 625 recorded sales down from the 970 recorded sold in the second quarter. Further, continued concerns have pushed the market lower from a high of 1,550 recorded sales in third quarter 2005 and 850 sales for a year ago. Housing activity slowed throughout the quarter as shown by the monthly activity — July with 230 recorded sales, August with 250 sales, and September with 150 sales. For comparison, for third quarter 2007, there were 11,625 sales recorded in Maricopa County.

Much like the sales activity, the median price has steadily eroded from $220,000 in fourth quarter 2005 to $200,000 in second quarter 2007, and $193,000 for the third quarter. It was $199,900 for a year ago. The median home price in Pinal County was 75 percent of the median price in Maricopa County ($256,975), while it was 77 percent for a year ago. Although the thirty-year mortgage remained unchanged at 6.2 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 $1,040 to $1,005. It would be $1,340 for the median priced home in Maricopa County.

“Although affordability has improved, higher gasoline prices, more congested highways and limited employment opportunities continue to adversely impact the housing market in Pinal County,” said Jay Butler, director of Realty Studies in the Morrison School of Management and Agribusiness at ASU’ Polytechnic campus. “Because investors were also drawn to the inexpensive housing in Pinal County, higher prices have limited their role in the local housing market.”

In addition, in order to reduce inventories, new home builders have been 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 2,645 homes with a median price of $196,180. Thus, there are many reasons for the slowing market and issues that will have to be overcome for any future recovery.

The median square footage for a resale home in Pinal County was 1,660 square feet, while a new home was 2,185 square feet. In Maricopa County, the resale home was 1,745 square feet and 2,735 square feet for a new home and a median price of $276,000.


GREATER PHOENIX REAL ESTATE MARKET
Quarterly Resale Home Sales and Median Prices
Selected Cities in Pinal County

 

City First Quarter 2006 First Quarter 2007
Resales Median Price Resales Median Price
Apache Junction 295 $229,500 210 $235,000
Arizona City 60 143,500 40 135,000
Casa Grande 220 175,000 95 180,000
Coolidge 50 114,000 35 125,900
Eloy 30 119,900 15 118,450
Florence 30 195,950 30 157,270
Maricopa 95 250,000 90 246,500
Queen Creek 230 239,860 200 207,170
San Manuel 25 80,000 15 100,000
Tucson (Saddlebrook) 45 462,500 50 395,000
Pinal County 1,110 $211,500 840 $204,600

 

City Second Quarter 2006 Second Quarter 2007
Resales Median Price Resales Median Price
Apache Junction 305 $224,450 210 $217,500
Arizona City 65 139,900 45 137,450
Casa Grande 220 179,000 105 177,120
Coolidge 45 123,000 35 108,500
Eloy 40 89,000 30 130,000
Florence 25 170,000 45 170,000
Maricopa 95 256,500 115 219,500
Queen Creek 250 235,000 240 198,000
San Manuel 30 104 20 100,000
Tucson (Saddlebrook) 50 370,000 80 382,500
Pinal County 1,180 $211,000 970 $200,000

 

City Third Quarter 2006 Third Quarter 2007
Resales Median Price Resales Median Price
Apache Junction 200 $224,000 125 $218,500
Arizona City 55 145,220 35 135,000
Casa Grande 170 175,000 45 157,995
Coolidge 30 107,500 30 140,000
Eloy 25 85,000 15 127,500
Florence 20 178,000 20 154,900
Maricopa 70 217,625 55 215,000
Queen Creek 180 220,000 195 193,050
San Manuel 35 98,000 10 103,000
Tucson (Saddlebrook) 35 350,000 55 335,000
Pinal County 850 $199,900 625 $193,000

 

City Fourth Quarter 2005 Fourth Quarter 2006
Resales Median Price Resales Median Price
Apache Junction 360 $220,900 165 $216,500
Arizona City 95 145,000 35 139,900
Casa Grande 210 180,000 150 160,000
Coolidge 35 94,500 25 101,000
Eloy 30 80,000 25 106,000
Florence 40 165,000 15 169,000
Maricopa 90 252,000 55 220,000
Queen Creek 345 243,900 175 210,000
San Manuel 25 83,500 10 90,750
Tucson (Saddlebrook) 55 389,950 40 412,450
Pinal County 1,340 $220,000 720 $191,500