Dru Bloomfield made an interesting observation regarding Scottsdale single family homes median prices by zip code. Most hit their peak in 2007 contrary to popular belief that along with sales, prices have been dropping since 2005.
I took a look at Tempe zip codes (also thanks to Mike Orr of the Cromford Report), and found a similar situation, although the Tempe median highs were generally earlier in 2007 than for Scottsdale. And like Scottsdale, one Tempe zip code, 85284, did not hit the high median until this year (February 2008).
|
Ranking |
Zip |
Highest Annual Median |
Date of High Median |
Current Annual Median |
% Difference |
|
5 |
85284 |
$442,500 |
Feb-08 |
$397,000 |
-10.30% |
|
7 |
85283 |
$294,950 |
Feb-07 |
$264,000 |
-10.50% |
|
15 |
85282 |
$279,500 |
May-07 |
$245,000 |
-12.30% |
|
21 |
85281 |
$265,000 |
Jan-07 |
$225,000 |
-15.10% |
Data from the Arizona Regional Multiple Listing Service,
Jan 1, 2001 – Sep 1, 2008 © 2008 www.cromfordreport.com
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{ 4 comments… read them below or add one }
Rod, It would interesting to know if our two cities are anomalies, or if they’ve been more protected from depreciation because of location. Guess I’ll need to do some more digging at the Cromford Report.
Dru, I was thinking similarly. I think Tempe has generally seen less depreciation due to it’s restricted boundaries (supply and demand), and probably some influence of a major university presence like ASU. It’s also notable that the highest cost zip code, 85284, held it’s value the longest, with the least change. Perhaps a similar effect with Scottsdale’s high value areas?
Hi Rod / Dru
You might be interested to know that I have just today updated the ZIP Code Median report so the data now reflects data up to Dec 1, 2008.
This table is based on annual median sales price, rather than monthly median. This is a relatively stable, non-volatile statistic since it covers a much larger sample of sales data. I use this because many of the smaller ZIP codes are too small for the monthly median to be a stable, reliable indicator. However the annual median is somewhat slower to respond to changes in the market. Hence the maximum annual medians were often reached in 2007 even though the monthly medians (and Monthly $/SF) peaked in 2006. Only a few areas peaked in 2005, notable examples being Queen Creek and Maricopa.
It is certainly true that Tempe and Scottsdale have seen less depreciation than much of the rest of the valley. This seems to be largely due to lower foreclosure activity. Where foreclosures are scarce, prices are higher. I don’t think that Scottsdale and Tempe are anomalies, because these conditions are also is true in a few other areas, e.g. Sun City, Wickenburg, Padadise Valley and Sun Lakes. This is why I have introduced the “Distress Index” which is a measure of foreclosure activity, and hence a signal of downward price pressure. The distress index is relatively low in both Tempe & Scottsdale.
Mike, appreciate your update and clarification of the table. As you know, I just recently subscribed to your report – will take a closer look at the distress index and your other analysis indicators.
I also did an analysis of foreclosure vs “normal” sales activities of various cities, and in line with your distress indicator, noted that Tempe and Scottsdale were the least affected so far.