Sun City West is one of a handful of communities in the Valley where the amount of money per square foot received by home sellers declined from June 2011 to June 2012.
A new report from the W.P. Carey School of Business at Arizona State University showed a 4 percent drop in the price per square foot of a Sun City West home year over year, from an average $97.88 in June of last year to $93.79 last month.
The only other communities seeing declines were another senior living community, Sun Lakes, along with Wickenburg, Fountain Hills and Eloy.
Sun City, on the other hand, saw a 4 percent increase per square foot, $66.36 to $69.16, the report revealed.
One of the biggest hikes in the Valley occurred in El Mirage where the square-foot price jumped an average of 41 percent. Glendale, Peoria were up 25 percent, 20 percent and 16 percent, respectively.
The report found the big price increases seen in the Phoenix-area housing market over the past several months are slowing down. For example:
• The median single-family home price went up 2 percent from May 2012 to June 2012, but it’s still up more than 29 percent from last June.
• The amount of single-family-home sales activity went down about 16 percent from last June, largely due to the limited supply of homes for sale.
• The foreclosure rate is dropping.
The median single-family-home price in the Phoenix area reached $150,000 in June. That’s a small increase from $147,000 in May, but a significant increase from last June, when it was at $116,000.
“This market remains extremely unbalanced, with far more buyers than sellers,” said the report’s author, Mike Orr, director of the Center for Real Estate Theory and Practice at the W.P. Carey School of Business. “The number of single-family homes in the Greater Phoenix area without an existing contract was down to just over 9,000 as of July 1, and most of it — 78 percent — is above the $150,000 mark.”
Not counting homes already under contract, supply went down 33 percent from Aug. 1 of last year to Aug. 1 of this year, the study showed. In particular, the inexpensive “distressed supply” of homes is down a 68 percent. However, Orr said things have eased slightly. There was only a 15-day inventory of single-family homes for sale under $150,000 in May, and that went up to 18 days in June.
“On the seller side, most homes priced below $250,000 are attracting a large number of offers and often exceed the asking price,” Orr said. “However, the situation for the average home buyer remains dire, despite low interest rates and historically cheap prices. That’s because of the low inventory, and any offer from an ordinary home buyer is typically going to be less attractive than the multiple all-cash offers from investors with few strings attached and no appraisal required. Many ordinary buyers are coming away empty-handed after submitting 10 or more offers.”
Orr said many home buyers are turning to new-home sales and construction, fueling a 39 percent increase in new-home sales from June 2011 to June 2012. Permits for single-family-home construction were up 49 percent over last June.