by Kerry Fehr-Snyder - Jul. 16, 2008 01:59 PM
The Arizona Republic
As housing prices continue tumbling, it's getting easier to afford a home in the Southeast Valley, a new study says.
ASU Repeat Sales Index
The index tracks repeat sales of the same home over time, using a pair of sales to gauge price changes. This helps control for differences in location, house characteristics and market conditions.
Existing home prices
Existing home values are being dragged down by foreclosures, which are resulting in discounted sale prices for other resale homes. Foreclosures are accounting for 20 to 30 percent of all re-sold homes, compared with 5 percent in a more typical housing market.
Home prices fell 18.4 percent in April compared with the same month a year ago in the Southeast Valley. The percentage decline matches that of the overall metro Phoenix's drop. "The accelerating rate of decline suggest the house prices have a long way to climb and that things will get worse before they get better," the report concludes.
• Mesa: down 18.5 percent.
• Chandler: down 15 percent.
• Tempe: down 12.1 percent.
• Gilbert: Not available.
City affordability
The ASU Repeat Sales Index also evaluates affordability.
An affordability index of 100 means that a household with the median income for the area can afford a median-priced home in that same area at the going interest rate of 6 percent. The higher the index number, the more affordable a home is because it means a buyer earns more than the median income needed to buy a median-priced house.
• Tempe: 79.
• Mesa: 93.
• Ahwatukee, as part of Phoenix, had an affordability index of 98.
• Chandler: 108.
• Gilbert: Not available.
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