Scottsdale fails to grab home buyers' interest

While Valleywide home sales posted their first year-to-year increase since 2005 last month, sales in Scottsdale are still lagging. Experts say that's because available loans are mostly for lower-priced homes, which are more plentiful in the south East Valley than in Scottsdale, where median home values surpass the half-million-dollar mark.

There were 330 resale homes sold in Scottsdale in April, down from 400 sales the same month a year ago, according to a report by Arizona State University's Realty Studies Office.

The median value for single-family home sales also dipped from $557,500 last year to $506,500.

Valleywide, home sales grew from 4,855 last year to 5,585 this April. Median home prices, however, dropped from $220,000 to $210,000.

The biggest reason cheaper homes are selling is the kind of financing available to buyers, said Scottsdale-based real estate agent Karl Stauffer.

There are lower interest rates and more money available for loans that are under $417,000 as opposed to larger loans, he said.

As a result, homeowners in the comparatively lower-priced areas of the south East Valley looking to sell can not only find buyers more easily, they can also get loans as they look for an upgrade, Stauffer said.

But Scottsdale residents trying to sell homes in the $400,000 range or higher would have more trouble getting a loan to buy up to a more expensive house unless they have a lot of cash on hand, he said.

Then there's what ASU Realty Studies Director Jay Butler called "the tale of the two Scottsdales." With Doubletree Ranch Road as the approximate dividing line, the median resale home price in April was $563,000 for north Scottsdale but $266,500 for south Scottsdale.

According to Stauffer's analysis and own real estate deals, the lower-priced homes in Scottsdale are selling. For the number of buyers out there, there are fewer homes remaining on the market in the $300,000 to $400,000 range than there are in the $400,000 to $500,000 range, he said.

More action on the lower end of the spectrum explains why the median home price dropped for Scottsdale as a whole, Stauffer said.

"If there's more action on the lower end, of course the median's going to come down," Stauffer said. "That doesn't mean a particular property came down in price."

And with factors like high gas prices a consideration, south Scottsdale has location going for it, Butler said.

"People are looking at locational issues again, which they should have been in the first place," Butler said. "Scottsdale has all the amenities there - a fairly good school district, easy access to things - and it's not an hour outside the city limits."

Plus, people who want to buy in Scottsdale can afford it right now.

"Really what you're looking for is a Scottsdale address," Butler said. "Nobody asks if you live in north Scottsdale."

Scottsdale's condominium sector also saw fewer sales this April with 205 sold, down from 300 last year. The median price of a Scottsdale condo or townhouse dropped from $264,450 in April 2007 to $262,500 this year.

A combination of factors is probably to blame for that, Butler said.

While no one is sure of exact figures, a lot of condos are purchased as winter residences or second homes, an idea that's giving people pause in the current economic situation, Butler said.

And with single-family home prices coming down, some buyers who may have looked at a condo can now afford to purchase a house instead, he said.