The
Arizona Republic reported that experts believe the recent stabilization of median home prices could signify that the Phoenix real estate market has started to rebound. The article sites an ASU professor and three private-sector analysts, two from Information Market, a Phoenix-based firm.
In the West Valley and specifically in
Estrella, we’re seeing more qualified buyers making offers in August in the $250,000-or-less range, and homes listed for $100,000 or less are selling even faster. Our hunch is that the latter is more investor driven, but regardless it signifies, in our opinion, that buyers believe West Valley real estate values have hit (or are approaching) rock bottom. Whether or not they’re right is another story. The
Republic article supported this notion, citing a bobbling but stabilizing median home price over the past three months.
We take issue with the article’s headline and lead paragraph that suggest the worst is behind us. It’s a misleading tone because the second half of the story reveals that experts fear the potential (and unknown) impact of imminent foreclosures in the coming months. The experts acknowledged that if the predictions of foreclosures is accurate (July foreclosures hit a record high of 5,300), it will have an adverse affect on median West Valley real estate values.
In addition, the article appears to contradict itself in the seventh and eighth paragraphs. It quotes the ASU professor: "Clearly, the rate of decline has bottomed out and appears to be moving in the right direction." In the next sentence, the reporter writes that “caution is the guiding principal behind” the professor’s research. The professor’s conclusion certainly seemed to be more definitive than cautious, especially when you consider the nebulous foreclosure issue previously mentioned.
In summary, signs that homebuyers value West Valley real estate are presenting themselves, which suggest that, as analyst RL Brown says in the article, the market fundamentals are sound. However, we think caution is the best policy, and predicting that we’ve seen the worst of this down market might be premature.
