Existing home sales slightly down in Valley during October

Existing home sales across the Valley fell slightly in October compared with the month before and so did prices on non-foreclosure properties, according to the latest report from Arizona State University's Realty Studies Department.

"The bad news just sort of continues to roll on," said Jay Butler, realty studies director. "There's no real particular good news about what's happening."

Click for full version

Some 8,210 resale homes sold last month, including 3,745 foreclosures and 4,465 traditional sales. That's down from 8,280 in September, but way up from 3,970 in October 2007.

The median price was $175,000 in the traditional market last month and $159,775 in the foreclosure market. That's down from $180,000 for traditional sales, but up from $153,000 for foreclosure sales in September.

Many people are concerned about the future, the economy and the stability of their jobs, and in turn are apprehensive about making a major financial commitment like buying a home, Butler said.

"What drives confidence is jobs," he said. "As long as that's an uncertain area, people will be concerned about making any major decisions. Plus, the underwriting guidelines for mortgages are tighter, so it's more difficult to qualify for financing."

From a buyer's perspective, "the world is their oyster, they have lots of different choices in areas all over the Valley," said Dee Kepp, associate broker at Independence Realty in Tempe and president-elect of the Southeast Valley Association of Realtors. She's noticed an increase in sales in the past week.

"I happen to be working with three buyers at the moment and I just got a contract on one of my short-sale listings, all in the last week," she said. "And lots of my agent friends say all of a sudden there's some movement. I don't know if it's because of the election being over with ... but at least it's a positive move forward."

Through October, the 2008 year-to-date resale total includes 39,055 traditional sales and 28,755 foreclosure sales.In every East Valley city, foreclosures made up a significant portion of overall sales last month.

"I think we might see a lull in foreclosures over the next few months," Butler said. "We have these mediation programs that are offered by the lenders and the federal government, and even some of the banks have announced that they're slowing or stopping their foreclosure activity for a while as they work through these mediation programs. And the other thing is I think some people will do what they can to stay in their homes for the holidays."

Kepp expects another round of foreclosures will hit the market as interest rates reset on more adjustable rate mortgages in the next few months.

"So if people cannot afford those payments after the reset, then those possibly will become additional inventory because they won't be able to afford the jump in their payment," she said.