Mid Month Price Update and Forecast from Michael Orr at the Cromford Report:
"Each month about this time we look back at the previous month, analyze how pricing has behaved and report on how well our forecasting techniques performed. We also give a forecast for how pricing will move over the next 30 days.
For the monthly period ending March 15, we are currently recording a sales $/SF of $114.45 averaged for all areas and types across the ARMLS database. This is 5.31% higher than the $108.63 we now measure for February 15. Our forecast range was $111.46 to $116.00 with a mid-point of $113.73. This month the actual value was in the upper half of our forecast range, and 0.63% above the mid-point. Despite our forecast being for a very aggressive price increase we slightly under-baked it. Nevertheless when prices are rising by 5.31% per month we are happy with an accuracy of 0.63%
On March 15 REO sales across Greater Phoenix (all types) averaged $85.36 per sq. ft. (up 5.7%). Pre-foreclosures and short sales averaged $84.47 (up 1.9%) while normal sales averaged $125.22 (up 3.1%). The market share of normal sales rose strongly over the last 30 days, moving from 66.5% to 72.7% of sales. REOs lost market share from 16.3% to 12.2%. Short sales and pre-foreclosures continued to lose market share from 17.2% to 15.1%.
On March 15 the pending listings for all areas & types showed an average list $/SF of $108.27, 2.9% above the reading for February 15 - so pending $/SF has made another significant move upward over the last month, as it did at the same time last year. Among those pending listings we have 56.3% normal, up from 53.7% last month, a lower 13.9% in REOs and a weaker 29.8% in short sales and pre-foreclosures. The average pricing for pending listings on March 15 in each category was: $128.74 normal, $78.13 short sales & pre-foreclosures and $82.06 for REOs. Only the normal listings are showing a strong upward trend in pending $/SF However the favorable change in mix away from distressed properties will cause sales prices to move even higher.
Our new mid-point forecast for the average monthly sales $/SF on April 15 is $118.54, which is 3.76% higher than the March 15 reading. We have a 90% confidence that it will fall within 2% of this mid point, i.e. in the range $116.17 to $120.91. Note that the lower limit of our range is higher than the upper limit we predicted last month. Prices are moving exceptionally fast, though not quite as dynamically as they did in the spring of 2012.
September 15, 2011 - measured at $78.83 per sq. ft. - remains the $/SF pricing bottom 17 months ago. The record low monthly median sales price is still standing at $107,000 and this record low point was set on February 24, 2011. Our current monthly median sales price is now $165,000 - 54.2% above that low point."
So this is great news all around. I would like to see it moderate as price appreciation of 5.31% a month is not sustainable over a long period. Not good for anyone.
Click (85050 Monthly Average Sales Price 3.19.13) for the 85050 monthly average sale price per square foot.
Tags:aviano,desert ridge,phoenix,real estate,villages at aviano,fireside,Arizona,short sale,foreclosure,fireside at desert ridge,Toll Brothers,pulte,bella monte,north phoenix. Information and pictures supplied by MLS and deemed reliable but not guaranteed. Charts courtesy of The Cromford Report and Michael Orr.