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2015 good for metro Phoenix housing; why 2016 could be better
(View Original Article) Metro Phoenix’s housing market recovery has been long and slow. But it’s on track. And this year is poised to be the best year for home sales and prices in the Valley in nearly a decade. Last year, home prices, sales and new construction rebounded from 2014’s disappointing results. Foreclosures continue to shrink.
Arizona housing analyst Tom Ruff calls 2015 an “average year” for housing and that’s with some double-digit gains.
“The success of 2015 doesn’t rise to champagne corks popping off but there were market improvements in almost every way," said Ruff, who works for the Information Market, owned by the Arizona Regional Multiple Listing Service.
Among the positive signs:
- Resales were up 10 percent in 2015, according to ARMLS’ new STAT report.
- The region’s existing home price climbed 9 percent.
- New home construction jumped 46 percent, according to RL Brown Housing Reports.
- And pending foreclosures are down 26 percent to the lowest level since 2006.
More Millennials deciding to buy homes, and boomerang buyers, who lost houses to foreclosure, qualifying for mortgages again gave Phoenix’s market a boost last year.
The big bump in sales and prices from those big groups of potential homebuyers is expected to come this year. But most from these groups aren’t buying million-dollar mansions.
The Valley’s luxury market isn’t faring as well as the rest. The first half of 2015 was strong for sales of houses priced above $800,000. But in December, these pricier deals dropped 30 percent.
Declines in the stock market are mostly to blame for a slowdown in high-end home sales, say analysts. Ruff has been predicting 2016 will be a “breakout year’ for metro Phoenix’s housing market for a few years.
He is still optimistic but a few issues and events have him feeling a little more cautious: not enough affordable homes for sale, gas prices and the presidential election.
ARMLS’ pending sales index shows the Valley’s sales climbing this month, while the area’s median price dips a bit. Metro Phoenix has a lot of great events that draw visitors and home buyers in January. But, of course, in 2015 the Valley hosted Super Bowl XLIX. But Rough said if 2016 shapes up to be another average year for housing, that’s still a very good thing. After all, who can complain about a 9 percent increase in home prices.
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Foreclosure inventory & mortgages in serious delinquency hit 8-year low
The inventory of homes in foreclosure continued to decrease in November 2015, falling to the lowest level since November 2007, a new report from CoreLogic showed.
CoreLogic, a global property information, analytics and data-enabled services provider, released its November 2015 National Foreclosure Report on Tuesday.
The report shows that during the month of November foreclosure inventory declined by 21.8% and completed foreclosures declined by 18.8% compared with November 2014.
CoreLogic’s report also showed that the number of completed foreclosures nationwide fell year over year from 41,000 in November 2014 to 33,000 in November 2015.
Additionally, the number of completed foreclosures in November 2015 was down 71.6% from the peak of 117,657 in September 2010, CoreLogic’s report noted.
According to CoreLogic’s report, the foreclosure inventory represents the number of homes at some stage of the foreclosure process and completed foreclosures reflect the total number of homes lost to foreclosure.
CoreLogic’s report noted that as of November 2015, the national foreclosure inventory was approximately 448,000, or 1.2%, of all homes with a mortgage compared with 573,000 homes, or 1.5%, in November 2014.
The November 2015 foreclosure inventory rate marks the lowest for any month since November 2007, CoreLogic’s report showed.
“After peaking at 3.6% in January 2011, the foreclosure rate currently stands at 1.2% – a remarkable improvement," said Dr. Frank Nothaft, chief economist for CoreLogic. "While there are still pockets of areas with high foreclosure activity, 30 states have foreclosure rates below the national average which is evidence of the solid improvement."
But it wasn’t just the number of homes in foreclosure that fell to an eight-year low.
CoreLogic also reports that the number of mortgages in serious delinquency, which CoreLogic defines as 90 days or more past due, including loans in foreclosure or REO, declined by 21.7% from November 2014 to November 2015, to 1.3 million mortgages, or 3.3%, in this category.
According to CoreLogic, the November 2015 serious delinquency rate is the lowest since Dec. 2007.
"Tight post-crash underwriting standards coupled with much improved economic and housing market fundamentals have combined to push new mortgage delinquencies to 15-year-lows," said Anand Nallathambi, president and CEO of CoreLogic. "Although judicial states will likely continue to lag, given current trends, it is reasonable to expect a continued and significant drop in the rate of serious delinquencies and foreclosure starts in 2016."
CoreLogic’s report also showed that:
- On a month-over-month basis, completed foreclosures decreased by 10.9% to 33,000 in November 2015 from the 38,000 reported in October 2015.
- The five states with the highest number of completed foreclosures for the 12 months ending in November 2015 were Florida (83,000), Michigan (51,000), Texas (29,000), California (24,000) and Georgia (24,000). These five states accounted for almost half of all completed foreclosures nationally.
- Four states and the District of Columbia had the lowest number of completed foreclosures for the 12 months ending in November 2015: the District of Columbia (78), North Dakota (225), Wyoming (543), West Virginia (565) and Hawaii (686).
- Four states and the District of Columbia had the highest foreclosure inventory rate in Novemeber 2015: New Jersey (4.4%), New York (3.5%), Hawaii (2.5%), Florida (2.4%) and the District of Columbia (2.4%).
- The five states with the lowest foreclosure inventory rate in November 2015 were Alaska (0.3%), Minnesota (0.3%), Arizona (0.4%), Colorado (0.4%) and Utah (0.4%).
Click the image below to see the foreclosure inventory rate by state.
