Expert: High-end Valley homes stabilizing

by J. Craig Anderson The Arizona Republic May. 28, 2010 12:00 AM

A number of recent reports suggest home prices across the country could be headed for a double-dip. But ASU professor Karl Guntermann offers some good news in the meantime for owners of higher-priced homes in metro Phoenix.

His most recent report also marks a positive milestone for all local homeowners.

The Arizona State University Repeat Sales Index, an indicator of the Phoenix-area market's economic health that is tied closely to year-over-year changes in home price, has been showing continued steady price declines in the past year for homes above the average same-home sale price, which in April was $135,000.

That decline has begun to taper off, with high-end homes showing clear signs of stabilization, he said.

The index for overall home sales clocked in at 1 point in April, according to preliminary data from Guntermann, of ASU's W.P. Carey School of Business.

That's a positive 1 point, after three years of stubborn refusal to emerge from negative territory.

Guntermann said there's a good chance the index will remain on the upside of zero into the foreseeable future.

That doesn't mean it will gain much additional ground, however. Guntermann said he is expecting the index to remain relatively flat for the rest of the year with a possible, slight increase.

Some analysts saw signs of weakness in two national housing reports issued this month, one from the National Association of Realtors and the other from S&P/Case-Shiller, whose Home Price Index is calculated in a manner similar to ASU's method.

Like the other two reports, Guntermann's also was a mixed bag. It revealed continued weakness in the condominium market, with the index down 19 points from a year earlier.

The index, which rises and falls based on a number of factors, including changes in the market value of homes that have sold multiple times in recent years, has been creeping slowly toward the light since reaching its all-time depth of -35 points in April 2009.

The ASU index has been tracking home prices since 1990.



Expert: High-end Valley homes stabilizing