With prices advancing through the spring, the leveling-off was expected, and it should not represent a turnaround in which residents once again will see their property values fall, said Mike Orr, director of the Center for Real Estate Theory and Practice at ASU's W.P. Carey School of Business.
"It's a natural reaction to prices going up so fast in the spring," he said. "The summer is bound to slow down. The market can't keep going up at 5 percent a month; that's crazy. We sort of overdid things in the spring."
The median price of homes sold in Maricopa and Pinal counties in July was $149,000. That's down from $150,000 in June but up from $114,000 in July 2011.
Those figures represent a 0.6 percent drop for the month and a 30.7 percent rise for the year.
The average price per square foot for all sales went up 21.1 percent when compared with July 2011.
The median price for townhomes and condos rose 17.3 percent, to $82,000 from $69,900.
Orr said current home prices are sustainable, but the annual percentage growth is not, and that while prices will likely be higher a year from now, they won't continue to grow at such a rapid annual clip.
He said that the average price per square foot of $95.44 is about equal to the 2000 figure, although the prices are higher because the average home size has increased.
"We've crawled our way back to the same type of pricing we had in 2000," he said. "Everything else has gone up from inflation about 30 percent. House prices have gone up by 0."
He said that based on those figures, home prices could rise another 30 percent or so before they would once again stretch the average income too far and threaten another housing-industry collapse.
It's not certain they will go up 30 percent more, he added.
In another positive trend, sales of bank-owned homes fell 73 percent from July 2011.
Foreclosures for single-family and townhomes rose 13 percent from June to July, but Orr reported that was likely a short-term increase prompted by a legal settlement between the states and major lenders. The number of foreclosure starts, homeowners getting notice that they faced foreclosure, fell 14 percent from June to July.
Price increases stopped in July, but median sales prices for most types of homes are up compared with a year ago. Median home price by sale type:
|Type of sale||July 2012 median price||July 2011 median price||Percentage change|
|Short sales and pre-forclosures||$127,300||$115,000||10.7|
|Fannie- and Freddie-owned||$126,900||$95,500||32.9|
|Trustee sales to a third party||$117,460||$87,000||35|
Source: Arizona State University
by Ryan Randazzo - Sept. 6, 2012 The Republic | azcentral.com
Phoenix-area home-price dip called a 'natural reaction'