Pinal County home resale prices dive

August 12, 2008 - 7:05PM

Edward Gately, Tribune

Those willing to endure the high cost and headache of commuting can find bargains on existing homes in the south East Valley.

For the second quarter, the median resale home price in Pinal County was $143,100, down from $156,160 in the first quarter and way down from $220,000 in the fourth quarter of 2005, according to the latest report from Arizona State University's Morrison School of Management and Agribusiness at the Polytechnic campus.

The median price in Pinal County was 72 percent of the median price in Maricopa County.

"If they buy cautiously, the buyers have great opportunities there," said Jay Butler, director of realty studies in the school. "If you're looking for a home, and either work in Pinal County or travel is not an issue, it's good prices for fairly good-size homes."

The abundance of foreclosure houses on the market is driving prices down across Pinal County, he said.

"Even though your area may not have any foreclosures, the activity surrounding you will probably force the home prices down," Butler said.

Of the 2,100 recorded home resales during the second quarter, 845, or 40 percent, were foreclosures, Butler said. Although that was down from the first quarter, when 785, or 47 percent, of home resales were foreclosures, it still represents a dominant segment of the market, he said.

Johnson Ranch, a 2,014-acre, master-planned community off Hunt Highway, includes row after row of bank-owned houses, said Shawn Stagg, a real estate agent with US Preferred Realty in Mesa. He has sold houses in Johnson Ranch for about five years.

Banks want to liquidate as soon as possible and are willing to sell the houses strictly at fair market value, he said. That makes it hard for homeowners to sell a property at anything above that, he said.

"It's pretty dismal now," Stagg said. "The last time I checked ... there was a considerable amount of homes in Johnson Ranch for sale, and I'd say probably 60 percent of those are probably either short sale or bank-owned."

A short sale is when a bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the borrower.

Housing values have plummeted across much of Johnson Ranch, Stagg said.

"People who purchased when the market was really high, they've definitely taken a 40 percent hit," he said. "Most of what's selling out there now are the single-family, 1,600-square-foot or less homes, and some of them are starting to go for like $90,000. That's an outstanding deal."

Gina Rayer, a real estate agent with Pinal County Properties in Casa Grande, said sellers are having to accept less and offer more in order to attract buyers. Sales have risen, but prices haven't followed suit, she said.

"They're offering to pay closing costs, different things like that," she said. "They also make their homes much more attractive than a lot of these foreclosure homes."

Many foreclosure houses were left in bad shape by previous owners, and it can take longer for buyers to get into them, Rayer said.

"With a foreclosure it takes 45 days as opposed to a regular (home), which takes 30 days or even less," she said. "For the banks that own the homes, it takes them longer with their paperwork and reviewing everything."