Low-End Demand, Extra Days Drive Phoenix-Area Sales Surge

Low-End Demand, Extra Days Drive Phoenix-Area Sales Surge Phoenix-area home sales experienced a major lift in August, rising to their highest level for an August in five years, DataQuick reports. The data provider attributes the gains to the relatively high number of days for deals to close in August and strong investor and first-time buyer activity in the sub-$150,000 price range.

The median price paid for all homes sold, meanwhile, fell to its lowest level in more than 13 years. Across all price categories, buyers last month paid a median $118,000 for all new and resale houses and condos that closed escrow in August – down 1.7% from the month before. The median has fallen year-over-year for 14 consecutive months.

In total, 9,657 new and resale houses and condos were sold in August in the combined Maricopa-Pinal counties metro area – up 8.1% from July and 35.8% from August 2010.

On average, Phoenix-area sales have changed little – a decline of 0.1% – between July and August since 1994, when DataQuick began compiling its Phoenix market data in full.

New-home sales remained extraordinarily low, DataQuick adds, while resale transactions were 15% higher than experienced in an average August.

DataQuick also explains that August had 23 business days during which home sales could be recorded, compared with 20 business days in July and 22 in August 2010.

The 35.8% annual gain in sales also reflects a sharp rise in deals below $150,000. The number of homes that sold for less than $100,000 jumped 59.2% in August compared with a year earlier, while sales below $150,000 spiked 49.7% year-over-year. Meanwhile, sales between $200,000 and $600,000 rose 15.6% year-over-year and sales of homes priced at $800,000 or more were flat compared with a year earlier.

Absentee buyers, who are mainly investors, bought 44.1% of all Phoenix-area homes in August. According to DataQuick, distressed homes remain a huge target for this buyer group, representing almost 62% of the Phoenix-area resale market.

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