Tucson Market Statistics - June 2008
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| Jun 07 | Jun 08 | % change | |
| Home Sales Volume | $404,364,096 | $266,202,280 |  34.17% |
| Home Sales Units |
1378 | 1034 | 24.96% |
| Average Sales Price |
$293,443 | $257,449 | 12.27% |
| Median Sales Price |
$225,000 | $200,000 | 11.11% |
| Pending Contracts* | 2053 | 951 | 53.68% |
| Active Listings |
8665 | 8140 | 6.06% |
| New Listings |
2820 | 2095 | 25.71% |
| Average Days on Market |
64 | 78 |  18.00% |
*Has not yet closed escrow. | |||
| Information provided by Tucson Association of Realtors Multiple Listing Service | |||
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Additional information and a complete run down of the Tucson real estate market is available HERE. This MLS report is sent to all Realtors in Tucson, and is complete with color graphs and charts to help potential clients get a better understanding of the underlying real estate market conditions. Michael assists potential clients in this manner with NO COST to them! | |||
| ARCHIVED STATISTICS | |||
Market Recap: By Michael Oliver
As I stated last month, I truly think the Tucson real estate market is hitting bottom -- or may already have. Time will tell, but these numbers shown are not good if you are a seller. If you're a buyer, they mean you have saved more money than you would have last year. I think the trend to watch in order to know if the market is gaining strength rather than becoming weaker is the number of active and new listings. In my opinion, as long as active listings continue to come down -- which has been the case for the past several months -- eventually we will get to a balanced market. I believe that will occur when roughly 5500 active listings are on the market. There are 25% fewer new listings on the market versus last year, showing that fewer people are just "trying to sell." Those that are placing a home on the market really NEED to sell due to some underlying circumstance, i.e., require more room, moving out of town, job loss, etc, etc. I think that, as is usually the case, the market is starting to overcorrect and is stronger than the numbers indicate. From people that I talk to and from my daily involvement in the business, it seems that more people are willing to buy now than last year. The buyers are more in a buying mind set versus last year when many just wanted to "take a look." Buyers in today's market can really find some legitimate properties for good prices. They need to be willing to take a good look at the market and work with those sellers who are strongly motivated to sell their homes, whether it is a bank trying to unload their foreclosures or a regular seller just trying to sell for personal reasons. The deals are definitely out there. One more thing: if you're looking to sell a $500k plus home, you may want to sell now rather than later. After watching the stock market this week, many higher end buyers may be putting the checkbook away once they see their market statements this month. Seriously, buyers at the higher price ranges are very dependent upon the stock markets swings. When the market is up there is a lot more money available for these individuals to make a second or third home purchase and the exact opposite is the case when the stock market is down.
Buying Opportunities: Buying opportunities are everywhere. I think the outskirts of town are the most depressed. Areas like Sahuarita, Marana, and Vail no longer have people rushing to buy there due to overbuilding and the recent increase to $4/gallon for gas. Builders in this region are really "giving homes away" to move inventory. (However, some areas -- most recently Sycamore Canyon -- report some strength. I have witnessed Meritage Homes there continue to sell homes and lower incentives, and that does indicate strength to me.) If you're not interested in purchasing in outlying areas, there are still opportunities. I think all areas are under pressure, and that includes Oro Valley and the Tucson Foothills. Homes there are in a much higher price range, but with the stock market's severe decline, some of those sellers may be much more willing to sell to be able to liquidate cash and prepare for what could be a "bear market" in the stock exchange. However, if I were a buyer looking to purchase in the $500k plus range, I might wait 6 months before pulling the trigger to see where the stock market goes. The further down it goes, the more I would expect people to unload properties. This will be very true for the $1 million plus price range, but even the $500k-$1M may see continued downward pressure in the premium areas of Oro Valley and Tucson.
Investment Opportunities: I think purchasing some bank-owned homes should prepare you well for the situation a few years from now when the market will gain strength as the number of listings keeps going down. I also think (disclaimer I am not a stock broker and offer no guidance) bank stocks look super cheap -- JP Morgan and Bank Of America, especially. Their stock prices look very low to me, and both are top-notch banks. I get to see which banks seem to give mortgages out freely and which seem to be more reserved. Bank Of America and Chase, from my point of view, were pretty guarded in making loans. (Of course, Bank of America now owns Countrywide, which gave out mortgages like candy.) Of all the banks, I really like these two in particular. But that's enough about stocks. Just keep this in mind 5 years from now. Otherwise, if you have capital in reserve or can pay cash, a land purchase in upper end areas could make a nice turn around right now. All developers are getting beat down in the market, and many are selling off land to either get it off the books or to raise capital. Deals can be had on parcels of land that a developer or builder wants to get out of. Buying one of these and sitting on it, I think, could really pay off come 2010-2011 when I expect to see strength return to the Tucson real estate market. Those same developers will want to get old projects back on the books, so this could be a nice asset to have around.
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