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.

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.