Foreclosures slowing, but still drive marketPhoenix Business Journal

Foreclosures slowing, but still drive marketPhoenix Business Journal

The number of foreclosures may be down in the Phoenix area, but home losses are still driving the region’s housing market, according to the latest Realty Studies report from the W. P. Carey School of Business at Arizona State University.

Foreclosure-related activity represented 65 percent of February sales, says associate professor of real estate Jay Butler, author of the report. That includes both foreclosure sales and the resale of previously foreclosed properties.

More than 3,300 homes were foreclosed on in the Phoenix area in February, however, the number is down from January’s 3,500 foreclosures, and from last February’s 4,300 foreclosures. The overall number of resales increased with more than 4,600 single-family homes sold in February compared with about 4,200 in January. However, the number is about the same as in February of 2009.

The median price of single-family homes also increased. In February, the median was $140,000, up from $136,500 in January and $133,000 last February. Condos resales remain stable at $95,000, the same as in January, but down from $121,000 a year ago.

“The fundamental problem remains that a weak recovery is restricting job growth that could impact the ability of property owners to maintain their homes, and a large number of adjustable rate mortgages are expected to reset in the coming months,” Butler said. “Further, owners, confronted with declining neighborhood values and restrictive debt amounts, could decide to walk away from their homes.”