It’s typical for the Bullhead City real estate market to heat up in March, but this particular March was anything but typical. Fueled by low prices, and perhaps a rush to beat the First Time Home Buyer Tax Credit, home sales broke triple digits for the first time in 3 1/2 years.
55 of the 107 homes sold in Bullhead City were foreclosures (51%), compared to 56% in February.
A few observations I think are worth noting:
- The number of active foreclosures for sale in the Bullhead City area recently dipped below 100, something we haven’t seen since it hit 100 on the way up, before peaking around 200 in late 2008.
- For the first time since the reinvention of foreclosures, the number of them entering the market dropped actually dropped year-over-year. My shadow inventory theorist friends might call that the calm before the storm. We shall see.
- 22 of the 37 site built foreclosure homes that sold in March fetched less than $100,000. Today there are precisely 11 such homes on the market.
- The median sale price of site built foreclosures was $85,000, and $125,000 for non-foreclosures.
The sudden change in the market and the overall economy a few years ago has had a huge impact on nearly everyone. I am reminded of it literally on a daily basis, as we try to help homeowners understand their options so they can make sound, but very difficult decisions.
From a market standpoint, foreclosures have been a necessary evil in terms of correcting course. Before banks entered the market with their REO properties, inventory was growing, and growing, and growing as buyers stood by refusing to make a move. Prices got too high, financing was drying up, and sellers were going upside down. It was an absolute stalemate.
Of course most banks don’t want to hold real estate. They sell for what they can get. With buyers in charge, prices plummeted.
Here we are a few years later and the Bullhead City market is almost back in balance. Foreclosures still account for half the sales, but they are suddenly running low, especially in the very low price range.
“They” say that there are more coming – lots of them. The shadow inventory it’s called, a gang of bank-owned homes that will dump on the market all at once, “they” say. I’m not sure.
In my humble opinion, it’s all about how fast they get absorbed. Foreclosures greased the wheels of our market, and now we have some momentum. That makes right now a pivotal time in our market.
Can we carry that momentum in the long term if foreclosures continue to sell faster than they are replaced?
Do you fall on the shadow inventory side? If so, can the market withstand an increase in supply?
And how will the market react now that the homes for sale under $100,000 is only a fraction of what it was a few months ago?
While you ponder that, here are the stats:
Bullhead City Residential Sales in March 2010
This first section includes all property types. A breakdown by property type follows.
| Foreclosures | Non-Foreclosures | |
|---|---|---|
| Units Sold | 55 | 52 |
| Median Sale Price | $70,000 | $105,000 |
| Avg. Price per Square Foot | $59.12 | $78.63 |
| Avg. List/Sale Ratio | 95.0% | 89.5% |
| Avg. Days on Market | 99 | 195 |
Site Built Homes
| Foreclosures | Non-Foreclosures | |
|---|---|---|
| Units Sold | 37 | 31 |
| Median Sale Price | $85,000 | $125,000 |
| Avg. Price per Square Foot | $66.64 | $82.51 |
| Avg. List/Sale Ratio | 97.7% | 88.9% |
| Avg. Days on Market | 105 | 149 |
Manufactured Homes
| Foreclosures | Non-Foreclosures | |
|---|---|---|
| Units Sold | 14 | 15 |
| Median Sale Price | $32,450 | $60,000 |
| Avg. Price per Square Foot | $37.06 | $74.19 |
| Avg. List/Sale Ratio | 90.6% | 88.7% |
| Avg. Days on Market | 81 | 245 |
Condominiums
| Foreclosures | Non-Foreclosures | |
|---|---|---|
| Units Sold | 4 | 6 |
| Median Sale Price | $52,250 | $122,200 |
| Avg. Price per Square Foot | $66.76 | $69.66 |
| Avg. List/Sale Ratio | 86.1% | 94.3% |
| Avg. Days on Market | 108 | 302 |
Source: Western Arizona REALTOR® Data Exchange
August
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