The W.P. Carey School of Business at Arizona State University recently reported that housing prices in the Phoenix area are continuing to experience a year-over-year decline for the second month in a row.
Professor Karl Guntermann, who is the Fred E. Taylor professor of real estate finance at ASU, said after looking at a repeat sales index, where they calculate the price of homes as they are bought and sold over the years, they have found that in September of this year the price of homes in the Phoenix area dropped 4 percent, a number that follows August's 2 percent home sales decrease.
Guntermann said in the press release both numbers come after a rising increase in the sale price of homes that started in March of this year, and are also the lowest prices seen for homes in the Phoenix area since the end of 2001.
He said they looked at townhouses, condominiums and houses in foreclosure and non-foreclosure. According to Guntermann, although foreclosure homes have been in demand, in August they experienced a year-over-year decline that continued into September, where it sat at 6 percent. Guntermann also said the decrease for non-foreclosure homes rose to 9 percent in September when compared to its year-over-year evaluation. Homes in both situations were expected to hit a median price of $124,900, according to the press release.
Guntermann also pointed out that the price of townhouses and condominium drastically decreased since March, and has now fallen to around a 20 percent year-over-year decrease. The market for these homes fell to a preliminary median price of $62,000 in September, a number that is down from the August price of $65,000, and also the July price of $77,100.
"Any time prices go down that's not a good thing," Guntermann said, adding that in order to turn these numbers around we need to get people back in the work force.
"We need to create jobs," he said, adding that if more jobs become available in the area more people will move to the area and be able to bring these low home prices up.
Chelsea Brown is interning this semester for the Ahwatukee Foothills News. She is a senior at Arizona State University.