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Mesa Pre Foreclosures Made Homes Affordable, Pushed up Sales

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By : John Cutts    99 or more times read
The still high pace of Mesa pre foreclosures continued to push down home prices and drove up house sales in Mesa, Arizona in 2009, based on data from research firm Information Market.

The sales price median for homes in the city plunged by nearly 30 percent to $137,000 as Mesa foreclosed homes comprised 44.7 percent of total house sales in 2009. Of the 6,940 units sold in 2009, about 3,100 were purchased from banks or bought at home auctions in Mesa.

With the number of manufactured foreclosures also rising in Mesa, the decrease in home prices was even more controlled in nearby cities like Chandler and Gilbert, where the median dropped only by 18 percent, and in Tempe, where median fell only by 21 percent. Foreclosed mobile and manufactured homes in Mesa were being sold at significant discounts of 12 to 22 percent by one online broker.

The only city that surpassed the price decline in Mesa was Phoenix, where the median plunged by a staggering 54 percent from 2008 to $90,000.

Information Market reported that all 27 communities in Maricopa County, where Mesa is located, posted price declines last year, the third straight year that home prices decreased throughout the county.

However, despite the surge in foreclosures, the pace of Mesa pre foreclosures in 2009 was slower compared to the pace in Phoenix and in the West Valley.

According to Jay Butler, real estate professor at the Arizona State University, said that the close proximity of Mesa and other areas of the Southeast Valley to job, education, church and retail centers helped residents weather the recession. Many of the zip codes that remained stable despite the surge in foreclosure filings were in the Southeast Valley.

Butler also explained that the surge in home sales in 2009 was driven by the high inventory of cheap foreclosure homes on the market. First time buyers and young adults with families were also encouraged by the tax credits. In addition, investors who snapped up properties also made substantial contributions to increased sales.

In Phoenix, foreclosure sales comprised 57 percent of total house sales in the metro area while in Glendale, foreclosure sales accounted for almost 60 percent of total sales. Sales of foreclosed homes in Tempe, Gilbert and Chandler comprised about 30 percent of sales.

As a suburb of Phoenix, the pace of Mesa pre foreclosures was expected to follow that of Phoenix, but Mesa was stronger in bearing the burden, as shown in the lower price declines.

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