Phoenix: Valley’s median home prices up 49%
East Valley Tribune – With a 48.9 percent hike in median sales prices, the Valley led the nation in year-to-year price growth for single-family homes, according to data released Wednesday by the National Association of Realtors.
The double-digit increase brought the median price of an existing home in the Valley to $268,400 in the fourth quarter of last year, compared with $180,200 in the fourth quarter of 2004, data show.
“Phoenix is also leading the nation in the appreciation of condominium prices. They are up 50.9 percent to $175,600,� said Walter Molony, spokesman for the National Association of Realtors.
Despite the double-digit increases, the Valley is still a bargain, Molony said. “Even though you’ve had such strong price growth, your median home price is less than half that of areas where people are coming from,� he said.
For example, the median sales price of a single-family home in the Los Angeles metro area was $568,400 during the fourth quarter of last year. In Las Vegas, it was $315,900.
That in turn is helping to drive up Valley prices, Molony said. “You have very strong inmigration, with people leaving very high-cost markets,� he said.
“These are people that are coming in with a lot of cash. They don’t need a mortgage. They don’t need an appraisal. They’ve got a lot of capital, and it makes it easier for them to pay cash. And with this tight housing supply, that is what is driving up these prices.�
But Molony and Jay Butler, director of the Arizona Real Estate Center at Arizona State University, said homeowners shouldn’t bank on continuing hikes.
“According to their numbers, from third quarter 2005 to fourth quarter 2005, we only increased $400. That’s not a hot market, but if you go year to year, it is. We’ve been stable at this $260,000 mark for the last several months,� Butler said.
According to center figures, the median sales price of an existing Valley home in January was $257,000, down $3,000 from December’s median price of $260,000.
To get a taste of what might be in the Valley’s future, Molony said market watchers here should turn their eyes to regions that have previously experienced significant upswings.
“Las Vegas similarly went through a 50 percent price growth. But Vegas has come down to a 12 percent price growth (last quarter), that is still an excellent return. If you were in a normal market, prices would be rising about 5 percent,� Molony said