The Phoenix real estate market has observed quite a roller coaster ride in the last several years with the trail heading for the most part down. Is there any near term sparkle of hopefulness for this market? In my opinion I sense 2011 will be a year of more stabilization for Phoenix and by ’12 we will essentially begin to observe a slow progression of home prices going back up.
Several parts of the Phoenix real estate market have been hit worse than others. The hardest damaged regional communities are Maricopa, Avondale and Goodyear just to call out a few. A handfull of HOA’s have in fact gone bankrupt! Communities that appear to be stabilizing the most are Scottsdale, Gilbert and Peoria.
The present development seems to be headed for a double dip. After the 2007 melt down the market to some extent stabilized and started creeping back up in 2010. Interest rates, government assisted home buying plans as well as the return of investors where the major reasons in home prices inching back up. Nevertheless over the previous couple of months prices look to be taking one more down swing. Investors are becoming a little bit more cautious plus the government subsidies to first time home owners are no longer obtainable.
As with every market failure the rebound is not going to go straight up. There is absolutely gonna be several bumps along the way and this is just one of them. Housing markets generally slow down in the winter anyway is one reason. Median home values for the Phoenix area are currently about $120,000 and are forecast to hit $110,000 by late winter before they begin to gradually moving back up. The majority of all area economists and housing professionals in this area agree, as I stated above, that we will notice more stabilization in ’11 and some recovery starting in 2012.
Will this imply foreclosures are going away…absolutely not. The moratorium that some banks have recently instituted could make some difference in future foreclosues though. Most of the larger banks ARE starting to get more serious about loan modification as opposed to foreclosure. But we will still witness a large number of foreclosures in the next several years. We want to see added job rebound, which by the way we are beginning to witness glimmers of this within Phoenix, furthermore there are actually still 1000’s of foreclosures that plainly said will still shift into the foreclosure group of households.
There are varying opinions from the specialists on just how are market will get better but one thing everybody is positive of is the Arizona real estate market WILL, in due course recover.