As Phoenix home values surged and foreclosures and short sales declined during the last year, homes priced at the lower end of the market have received the bulk of the attention.
But what about the luxury home market such as Scottsdale and Paradise Valley?
Real Estate Experts in those luxury markets have reported the luxury home market — which accounts for homes priced above $1 million — did not lose the same value as we have seen in the Phoenix Metro market. Additionally, values on those homes have been recovering at a slower pace than most.
The number of Phoenix-area luxury home sales peaked in 2005 at 1,563 — almost four times the sales volume reported four years earlier. Although sales gradually declined thereafter, luxury prices peaked at $404 per square foot in Dec. 2007.
But those mega-home values tumbled beginning in 2008 as the housing crisis crippled the Valley. While luxury home values continued to decline for a longer period than those of lower-priced homes, their overall peak-to-trough decline was not nearly as dramatic.
For example, luxury-home prices hit bottom in February 2012 at $277 per square foot, while the rest of market had already been rising for four months prior. Although that February figure was a significant 31 percent drop from the 2007 peak, it was still less of a blow than the whopping 59 percent decline the rest of the Valley housing market experienced from its peak.
Last year, luxury home sales — about 800 — reached the highest level since 2007. By the end of 2012, luxury home prices had also risen slightly by about 5 percent to $291 per square foot, and are expected to continue rising.
And, unlike the Valley housing market’s supply problem, the supply of luxury homes for sale was roughly in balance with demand by the end of last year.
After three consecutive years of holding strong at No. 2, Arizona’s 2.69 percent home foreclosure rate dropped to the No. 3 spot in the nation last year, according to RealtyTrac’s 2012 year-end report released late Wednesday.
Improving from second worst to third worst is hardly an improvement by most standards however, foreclosure activity throughout Arizona was still down significantly — by 33 percent from 2011 and 51 percent from 2012.
That 33 percent year-over-year decline in foreclosure activity last year was also the fourth-biggest drop in the nation, the report said.
• Arizona’s 2.69 percent foreclosure rate for 2012 means that nearly 76,500 homes statewide had a foreclosure filing — meaning a default notice, scheduled auction or bank repossession — at some point of the year. In other terms, that’s one in every 37 existing homes in Arizona that entered some stage of the foreclosure process.
• The metro Phoenix foreclosure rate was 3.09 percent, which ranked the area at No. 17 in the nation.
• Both Arizona and Phoenix have notably higher foreclosure rates than that of the nationwide figure, which fell slightly to 1.39 percent for the year.
• The foreclosure process continues to grow longer for struggling homeowners. In the final three months of 2012, the foreclosure process took an average 414 days to complete. That’s up almost 20 percent year-over-year and the longest-ever time frame since RealtyTrac began tracking that data in 2007.
• Government-backed entities of Fannie Mae, Freddie Mac and the Department of Housing and Urban Development were responsible for 26 percent of all bank-owned inventory last year. Bank of America followed in second place with 8 percent of all bank-owned inventory, Wells Fargo had 6 percent while US Bank Corp and JPMorgan Chase each had 4 percent.
Recent Posts
Recent CommentsArchives
Categories
Meta
