TEMPE, AZ – A new Arizona State University report shows over two-thirds of the current housing market activity is dominated by home foreclosures and foreclosure re-sales.
The Realty Studies report was released by
ASU’s W.P. Carey School of Business and stipulated that the sheer amount of foreclosure activity in the housing market stalls any opportunity for a real recovery.
Over 6,000 re-sales of Valley homes and 2,900 foreclosures were recorded in the month of September. These numbers have risen greatly in comparison to those of September 2008 when only 4,600 homes were re-sold.
MORE: ASU says Valley home prices up for the first time since 2007The number of foreclosures has dropped slightly from last year when about 3,650 homes were foreclosed in September 2008.
"Although the level of activity appears strong, the market is being driven by either homes being foreclosed or being sold back into the market by the lender," said Jay Butler, Associate Professor of Real Estate and author of the report.
Declining home prices have grabbed the interest of investors and homeowners, Butler stated, but the median price of a single-family home remains at the extremely low rate of $140,000 as compared to $180,000 in September of last year.
MORE: Selling your house: What's YOUR break even point now?Butler compared the current market situation to that of a ‘hyper market’ where investors are purchasing multiple foreclosed properties in hopes of rising appreciation values. Butler stated that without actual homeowners occupying a majority of homes, the housing market can't truly begin recovery.
"The impact of foreclosures on the market has been the primary concern of the last year and will continue to be in the coming months, especially with the end of many hiatus (loan modification) programs and the weak job market,” said Butler.
Butler’s full report, including statistics and separate breakdowns of Valley areas, can be found at the W.P. Carey
site.
