Casa Grande Dispatch
With fewer homes in short sale or foreclosure, 2013 was seen by real estate experts as a transitional year and 2014 is expected to be a more normal year.
“We are going into more of a normal market with not that many bank-owned homes for sale,” said Mike Orr, director of the Center for Real Estate Theory and Practice at the W.P. Carey School of Business at Arizona State University.
“It’s going to be much more of a normal year. Prices have climbed to an equilibrium level, and I think there will be much less in the way of excitement and fireworks.”
According to Orr, 745 homes were sold in Casa Grande’s 85122 ZIP code in 2013, a big drop from the 836 homes sold in 2012.
“The numbers have been coming down for the last couple years because there have been a lot fewer distressed homes on the market, which tend to sell for low prices,” Orr said.
But while the number of home sales was down from the previous year, the median sales prices have continued to creep up.
According to Arizona Regional Multiple Listing Services, for the third quarter in 2013, the median sales price of a house in Casa Grande was $128,000 — a 14 percent increase from the prior year, while Pinal County saw an overall median sales price of $139,900, a 16 percent increase from 2012.
“I think 2013 was dusting us off and patting us on the butts and saying, ‘We are here. We are going to be strong. We are going to get out of this. If we hold hands and stick together we are going to hang in there,’” said Wendy Birdsong of Birdsong Real Estate. “I think 2014 is going to be a good year for everybody. I think the merchants are going to see a big change, I think we are going to be a little more stable.”
Orr described the beginning of 2013 as a sellers market because supply was still at a low point, but then came a transition into a buyers market. He said at the beginning of the year there was 31⁄2 months of supply, which dropped to 21⁄2 months before rising again to about six months supply by the end of the year.
“Generally 4.5 and 6 (months supply) would be considered normal,” Orr said. “Below 4.5 would be considered shortage of supply, which would favor sellers, and above six would be too much supply, and that favors buyers.”
But while the median sales price in Pinal County has continued to show a gradual upswing since the third quarter of 2011, Orr said the market still hasn’t fully recovered.
He pointed to several factors including the 12,500 single-family housing permits approved for Pinal and Maricopa counties combined — a far cry from the 30,000 to 40,000 new homes that were being constructed in 1999 to 2000. In addition, Orr said the population rate is not increasing as fast as it did in 2000 and people are generally living more densely with the average number of people per home at a higher percentage than it was 10 years ago.
“I would say we are almost fully recovered,” Orr said. “The foreclosures are down to levels that are less than what they were 10 years ago. We don’t have much delinquency that we have to concern ourselves with. The rest of the country hasn’t gone as fast because they are not as efficient at doing foreclosures, but we really got through 99 percent of the problems and we can put that behind us and move it forward.”
Orr wouldn’t put a timetable on when he thinks the housing market will fully recover to price levels seen during the peak of the housing market bubble, but Birdsong expects it will take another five years.
She points to the pending opening of Sam’s Club and the development of PhoenixMart as signs that the area market will fully recover.
“Sam’s Club does not come into towns that are falling apart,” said Birdsong, who has been in the real estate industry for more than 35 years. “They don’t go to the expense of building a building and hiring people. They do their evaluations on that town and if we are going to take 10 years to get to the $200,000 to $250,000 median (sales price), I don’t think they would’ve done it.”
According to ARMLS, in Casa Grande, the average sales price, days on the market and closed sales all saw increases compared to the prior year. It’s a sign, according to Robbie Bechtel with Keller Williams Legacy One Realty, that the market is headed to a more normal path.
“For people who are relocating, it’s a great time to sell because we have a lot of overpriced listings on the market. As long as they can price their house
competitively, they can get it sold quickly,” Bechtel said.
“If you are a buyer, there are still opportunities, you just have to do a little more work to find them.”
