Areas like Phoenix are seeing multiple offers on affordable homes. The table below presents an overview of the single-family detached home statistics in the Phoenix, Mesa, and Scottsdale market. It also reveals the numerous amounts of bank owned, short sale, and auction properties.

Market Snapshot: Single Family-Detached Home Statistics for Phoenix-Mesa-Scottsdale
			Phoenix	Mesa	Scottsdale
Total Homes Available on the Arizona Flex MLS			8,365	6,757	3,935
Active Short Sales			1940	743	499
Active REO, Bank Owned			2,916	663	264
Auction Properties (owner occupied)*			5,000*	3,465*	1,707*
Total Homes Closed
	March 2009		1,951	506	243
	February 2009		1,413	379	192
	January 2009		1,283	325	170
Average S-F Detached Home Price		$279,223		$ 293,498	$ 1,186,146
Average Days on Market		143		146	211

With lower interest rates on buyer’s sides, it is a good time to purchase.  Once the economy begins to turn around, renowned economist, Dr. Joel L. Naroff, President of Naroff Economic Advisors, predicts that the Fed may raise interest rates sharply.  He states that the Federal Funds rate could rise from 0.5 or 1% to as high as 4.5% within a six-month period at the first signs of an economic recovery.  Overall, Naroff expects the second half of 2009 to have a stronger fourth quarter than other economic models currently predict.

Sources:

• *Data gathered through ARMLS. Owner Occupied Residential. http://armls.imapp.com/ilinks/search, many of the auction properties are not listed on the MLS and include all owner-occupied properties; therefore the number of homes available in the table does not reflect this number.

• FlexMLS. 31 March 2009.
• Knowledge @ W.P. Carey. The Economic Forecast?  Cloudy with a Chance of Shower, at Least until 2010. 18 November 2008.

Information deemed reliable, but not guaranteed.

It’s a no brainer that the recession is heaving chaos into the housing market, so it should come to no surprise that the First Quarter 2009 Economic and Real Estate Trends Report and its widely cited U.S. Market Risk Index(SM) released today, by the PMI Mortgage Insurance Company has gloomy projections. The PMI Report projects that 98% of the 381 Metropolitan Statistical Areas (MSAs) are facing an increased risk of lower home prices by the end of 2010.

PMI’s U.S. Market Risk Index projects the market risk of home price declines over a two year period in the 50 largest MSAs. The index uses economic, housing, and mortgage market factors to assess the probability of home prices in the 50 largest MSAs. Home price appreciation, employment, affordability, excess housing supply, interest rates and foreclosure activity are variables used in factoring the market risk.

According to the U.S. Market Risk Index, the Phoenix-Mesa-Scottsdale MSA ranked 10^th, and it stands a 98.8% likelihood that the area will face lower home prices by the end of 2010. The list displayed below presents the Top Ten Riskiest of the 50 Largest MSAs. Based on PMI’s Risk Index, these MSA’s have a high degree of risk, from 98.8% in Phoenix MSA to 99.9% in Miami MSA, that the home prices will decline.

Although these factors seem to dispel gloom and doom in these high Risk MSA Areas, these factors have lead to greater home affordability. While it may be a buyer’s market, some areas, like Phoenix, experience competitive bidding for many bargain priced homes.

Source:  PMI Mortgage Insurance Company. First Quarter 2009 Economic and Real Estate Trends Report 01 April 2009.