by J. Craig Anderson The Arizona Republic - Jan. 28, 2010 12:00 AM
For the first time since the foreclosure crisis began, the price of a Phoenix-area foreclosed home is roughly the same as it was a year ago.Arizona State University professor Karl Guntermann, who publishes the monthly ASU Repeat Sales Index housing report, said preliminary data for December show the median price for a foreclosed home was down just 2 percent from December 2008.
"If the preliminary numbers hold up, the foreclosure segment of the housing market will have reached bottom," Guntermann said. "A leveling out of the foreclosure RSI (Repeat Sales Index) would reflect both the substantial decline in prices that has occurred over the past two years and increased demand from first-time buyers and investors for those homes."
Guntermann said he was "a little surprised" that the index showed foreclosures so close to bottoming out.
In October, foreclosed homes still were selling at about 15 percent less than they had a year earlier, and by November that change had decreased to 8 percent, Guntermann said.
Then, in December, the annual drop shrank to a mere 2 percent, based on early numbers.
The December median sale price for the homes that Guntermann tracks was $127,000, up from November's median price of $120,000.
The index for non-foreclosed homes showed a very different trend in December, indicating that the Valley housing market
The median sale price for non-foreclosures continued on a steady decline that barely has budged in more than a year.
"By October 2008, non-foreclosures were declining at an annual rate of 20 percent, and they still are," Guntermann said.
December's median price for traditional sales was $158,000, compared with $166,000 in November.
The index does not correlate exactly with year-over-year price changes, he said, because there is a sort of reverse momentum built into the calculation that lowers the index slightly if it's on the rise, and raises it slightly if it's on the decline.
It has been dropping for a record 32 months since home prices peaked in mid-2006.
Still, Guntermann said that is likely to change within the next few months.
The overall index, including foreclosed-home and traditional sales, was down 12 percent from a year earlier.
That's a sizeable improvement over November, when it was down 17 percent.
The overall median price in December was $133,000, down from $135,000 in November, early data show.