Foreclosed Home List Prices Fall, Numbers Rise in Arizona

Foreclosed home list and non-foreclosure price levels continue to fall in several cities of Arizona, especially those in Pinal County, according to real estate studies by the Arizona State University.

Home prices continue their downward slide as reports indicate the arrival of two more foreclosure waves — one in the second half of the year and the other in the first months of next year.

According to Darrah Dremler, a broker working for Coldwell Banker Excel Realty, which specializes in foreclosed home list sales, reported information from Freddie Mac and Fannie Mae that large numbers of foreclosed home list properties will be released by banks in the next several months.

Dremler explained that the expected wave in August or September would consist of properties that were not added to foreclosed home list inventories because of foreclosure moratoriums.

The other wave expected early next year would come from foreclosures caused by adjustments of ARM loans taken out from 2003 through 2005, which are scheduled to readjust five years after they were originated. These ARM borrowers are expected to be hit with foreclosure notices after about 6 to 8 months of missed payments.

In the first quarter, almost 50 percent of all houses sold in the cities of Pinal County were from foreclosed home list inventories and prices declined by significant amounts from the price level in last year’s first quarter, according to ASU data.

In Casa Grande, the median price for existing homes dropped to $111,900 from $146,000. It fell to $65,450 from $114,500 in Arizona City; to $77,520 from 119,950 in Coolidge; to $91,290 from $95,939 in Eloy; to $80,000 from $141,660 in Florence; and to $113,250 from $170,000 in Maricopa.

In current listings of homes for sale in the seven cities, there are 2,692 units for sale, with 797 units in foreclosure listings and another 956 in short sale lists. The numbers put distressed homes in the cities at 65 percent of current home sale listings in the western part of Pinal County.

Nationwide, the inventory of unsold pre-owned homes by the end of the first quarter was 3.7 million units, based on data from the National Association of Realtors. NAR said it would take almost 10 months to sell all these foreclosure properties. If the waves of foreclosures described by Coldwell Banker realtor Dremler come true, then foreclosed home list inventories would inflate to levels that could not be sold in just several months.

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