Local real estate market has slowed but prices steady

By Art Pulis, Sun Business Advocate

A recent analysis of homes sold in Wickenburg over the past few years indicates that while sales have slowed, prices for homes on the market remain relatively high.

The accompanying chart represents an analysis of Wickenburg home sales for the past four years. The source of the data is the Multiple Listing Service as provided by Tadd Nixon owner of TAN Appraisal Services, Inc. of Wickenburg.

The data indicates that the sales price per square foot of the average home sold went from $116 to $185 or an increase of 56 percent. The rate of increase was greatest between 2003 and 2004 and is now slowing down.

Probably more significant for those in the real estate business is the number of homes sold during these years. That number increased to a high point of 288 during 2005 and now has significantly slowed.

“The selling frenzy has stopped,” said Nixon. “While values have not significantly dropped, the number of homes being sold has drastically decreased. This year we are only doing about half the number of appraisals as we did last year. The time on market figure hasn't yet reflected this slowdown because many of the homes now on the market have been there for a while, but the statistics don't change until they sell.”

Nixon attributed the rapid increase and present slowdown in the market to multiple factors affecting both Wickenburg and Arizona as a whole. He called the housing boom a rolling boom having started in California and traveling to many other hot spots of the country.

Traditionally Arizona has had relatively cheap land keeping prices down, but that changed in 2004. Land in the Phoenix market quickly increased in value and Wickenburg followed to a somewhat smaller extent. As many of our local developments started to sell out, land prices rapidly increased caused by the land shortage. This fact, along with the sharp increase in the cost of building materials, helped push prices up.

According to Nixon, the Phoenix market has experienced a sharp slowdown, which has been felt in Wickenburg to a lesser extent. While prices have not statistically fallen much in Phoenix, he expects that to happen since the rate of foreclosures is up sharply. With sales off in Wickenburg, he expects to see this market also soften somewhat in price.

“High raw land prices are keeping the market up at the present time,” continued Nixon. “We have several developments about to come on line, and when that happens we will see more available lots and can expect lot prices to level off or even drop a little. Generally the Wickenburg market moves in the same direction as Phoenix but a little later in time and a little less severe in amount of change.”

Print this story

Email this story

Click ads for more information