ASU professor: AF spared some pain of deepening foreclosure crisis - Ahwatukee Foothills News: News

ASU professor: AF spared some pain of deepening foreclosure crisis

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Posted: Saturday, August 21, 2010 11:00 am | Updated: 8:16 am, Thu Dec 2, 2010.

About 43 percent of all existing homes that changed hands in the Phoenix area in July were foreclosures, the highest percentage since January, according to a study recently released by Arizona State University.

However, Ahwatukee Foothills has been affected less than some other Valley communities because of its attractiveness to home buyers, said the report's author, Jay Butler, an associate real estate professor with ASU's W. P. Carey School of Business.

"We are seeing some areas that are improving, Ahwatukee being one of them," Butler said. "It has not fallen as far as many of the other areas have fallen."

Ahwatukee benefits from such things as having a good reputation, good schools, proximity to employment centers and a variety of housing types, he said.

"It's an area that's well recognized to be a quality area to live in," Butler said.

After several months in the 30 percent range, foreclosures are again on the rise across the Valley as a percentage of resale transactions. The Phoenix-area market had almost 3,900 single-family home foreclosures in July, according to the survey. That's about the same number as were foreclosed in June.

However, the number of non-foreclosed homes being resold is dropping off as the "selling season" comes to an end, Butler said. About 5,100 homes were resold in July, down from almost 6,900 resales in June. The resale market is not expected to pick back up again until early next year, he said.

"What it's showing is that the market is still predominantly being driven by foreclosures," Butler said.

Housing prices are being influenced by foreclosure-related activity. Resale home prices are declining as sellers are forced to compete with banks trying to resell foreclosed homes at cut-rate prices, he said. The median price of homes resold in July was $137,500, down from $143,000 in June.

"People who normally might be looking for a ‘move-up home' may be satisfied to stay in their current house, given the economy," Butler said.

The townhouse/condominium market had about 600 foreclosures in July, roughly the same number as in June, the survey reports. But the median price dropped from $94,600 in June to $84,500 in July. That is a steep downward trend, considering the median in July 2009 was $106,500, according to Butler.

U.S. Rep. Harry Mitchell (D-Ariz.), who held an educational workshop in Ahwatukee Foothills earlier this month for people who are losing their homes, said more needs to be done to tackle decreasing home values and foreclosures.

"We need to keep folks in their homes, which helps stabilize home values," Mitchell said. "We also need to avoid rewarding bad actors, including mortgage servicers who refuse to work with homeowners until they are at least three-months behind."

Contact Writer: (480) 898-7914 or acohn@ahwatukee.com

 

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