Tucson Market Statistics - March 2008
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| Mar 07 | Mar 08 | % change | ||||
| Home Sales Volume | $362,397,582 | $233,207,940 |  35.64% | |||
| Home Sales Units |
1339 | 900 | 32.78% |
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| Average Sales Price |
$270,815 | $259,120 | 4.25% |
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| Median Sales Price |
$220,815 | $200,000 | 9.24% |
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| Pending Contracts* | 1192 | 1410 |  18.28% |
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| Active Listings |
10,185 | 9022 | 11.42% |
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| New Listings |
2710 | 2444 | 9.81% |
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| Average Days on Market |
64 | 75 | 14.66% |
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*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 | ||||||
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Market Recap: By Michael Oliver
The Tucson real estate market, while still in a depressed state, is showing stats that coincide with a market on the rebound. If these trends continue, Tucson's market place will emerge from its downtrend and get its legs beneath it for the first time since late 2005. What indicates this to me is the fact that pending contracts have been up substantially for the past two months, meaning that more people are getting under contract to purchase a home. Also, active listings continue to keep coming down. Now the supply (active listings) needs to come down a whole lot more before we are in what I would call a balanced market. I would say active listings need to be around 5500 to suggest a balance. However, one important item to note is that the statistics no longer include the far outlying areas of Southern Arizona (places like Tombstone, and Cochise), so the decrease shown from March 2008 over March of 2007 is not 100% accurate. That being said, there are fewer listings on the market. In addition, the new listings prices are also down roughly 10%, meaning fewer people are trying to "test the market." (That's what sellers who overprice their home and want their real estate agent to work super hard to find a buyer at their inflated price call it.) Sellers in Tucson right now are realizing it is not a good time to "test. " In fact, you need to be at or under the comparables to facilitate a sale these days, and any property outside of those comparables is almost impossible to sell. Plus you will need to get your property exposed and marketed in a very effective manner because of the overwhelming number of properties. Buyers have many, many options now, and if your home isn't pushed to the forefront, even a low price may not be enough to get their attention.
Homebuyers are looking to capitalize on a still depressed market while many homeowners are trying to sell due to need -- whether financial, family- or job-related. This puts a qualified and able buyer at a huge advantage when negotiating. Buyers know they have the pick of the litter and sellers are all trying to outdo each other to make a sale happen. For buyers, the best deals I have been seeing are the bank-owned (also known as REO or foreclosure) homes. The banks need to keep their inventory of homes down as losses keep mounting from bad loans across the board. Foreclosed homes seem to be popping up in all areas and price ranges. Buyers looking in the southwest and southeast sides or in Sahuarita will see the greatest inventory of REO properties, but all areas have them available -- even high-end properties. I have seen several $1,000,000+ homes now in the possession of the lender. A strong case can be made for buying now, and my feeling is that this depressed market in Tucson will not last much longer. In fact, many think we have already hit bottom. Those who read my blog or other monthly reports know I do not think we have hit bottom yet, but are very close. At this point, I think prices have already gone down very substantially so that buying should be safe. If we have hit bottom, then every month from here on out, you will see the active listings decline, pending contracts up, and new listings down. When this happens consistently, the sales prices will take care of themselves and naturally start to stabilize, and then rise. Key point: the stats are always way behind the real prices in the market place. When a property goes under contract, it takes typically at least a month to close. The actual sales price is not disclosed until then. Furthermore, when new construction homes are sold, they still have to be built. It's typical for 5-8 months to elapse between initial sale and closing. Those buyers paid the market price at the time of purchase but its almost guaranteed that the true market price of their home will be quite different at time of delivery (closing). This is why in a very hot market buyers can "flip" a property and make substantial profits, while in a declining market the opposite is true.
Commercial property looks to be headed down in Tucson with the exception of office space, which seems in line with where it should be. Apartments are doing well on sales due to Fannie May and Freddie Mac expanding their loan programs to include residential apartment loans. This was never available before and has been a godsend to that sector; it would otherwise be in something of a lockdown due to the credit crisis reducing the availability of credit for purchases. With Fannie and Freddie allowing their monies (the government's) to back apartment complexes now instead of just single-family homes and small multi-unit complexes, many buyers are able to proceed with purchases that would not be possible otherwise. In addition, the money that Freddie and Fannie are lending comes at much better terms than even banks and other institutions are lending at currently. This will be short-lived as the apartment sector still suffers from competition from those homeowners who cannot sell their homes and are looking to turn that property into a rental. In Tucson, I do think the credit crisis has seriously slowed commercial projects, which should lead to a very small downturn (if any) due to little new supply hitting the market. How commercial real estate fares will, as always, depend upon the dynamics of the local economy and small business creation. Hopefully the current national recession will not result in a long economic downturn.
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