Home sales show first gain since July 2005

Skeptics cautious about April home-sale uptick

Misty Williams, Tribune

May 13, 2008

The Valley’s ailing housing market showed a glimmer of life last month with existing home sales posting the first year-over-year gain since July 2005. Some 5,585 resale homes were sold in April — up from 4,855 a year ago, an Arizona State University report shows. But experts say it’s unclear whether the increase marks the beginning of recovery or just a blip in the market.

“One month does not make a trend,” said Jay Butler, who heads up ASU’s Realty Studies department. “You just sort of have to wait and see.”

Year-to-date through April, sales totaled 16,975, compared with 19,045 last year, according to the study. Still, real estate agents say they’re seeing more buyer activity as home prices continue to slide.

The Valley’s median home price dropped to $210,000 in April, compared with $265,000 a year ago.

That’s the lowest median recorded since February 2005 at $200,000, the report shows.

Those lowered prices have opened up opportunities for first-time homebuyers and others who were priced out of the market during the boom.

Investors are also getting back into the game, and lenders are aggressively trying to offload foreclosure and bank-owned properties, Butler said.

The beleaguered economy continues to play a role, however, in some individuals’ reluctance to buy, he said.

People are worried about getting laid off, salary cutbacks, high gas prices and other costs, he said.

They’re saying, “Now may be a great time to buy, but maybe we need to be a little bit more cautious,” Butler said.

The market won’t level off until the huge inventory of foreclosure and bank-owned properties is whittled away, said Mike Wasmann, president of the Arizona Association of Realtors.

Those properties are driving down prices in some areas, making it tough for average home sellers to compete, Wasmann said.