We begin the new year with just 302 subdivision homes available on the MLS, listed at an average of $98.01 per square foot. 138 homes are currently under contract and 15 homes have sold since the first of the year, selling at an average of $88.28 per square foot. 15 homes may not sound like a lot but considering that there has been just 4 business days so far this year, that translates to nearly 4 homes closing per day which by any measure is a fast pace. If this first week of the year is any indication on how the rest of the year plays out, 2017 could be a record year for the Maricopa Residential Market, and why not? Homes sales hit a low point in 2014 following 5 straight years of sales increases following the 2008 crash but then trended upward again. Sales rebounded with a 15% gain in 2015 and while the dust has yet to settle on 2016, preliminary numbers indicate a 10% gain in sales, so in light of the current and projected commercial development in the area, the recent employment news, and the pace of new builds, the market is poised to be one of the strongest yet in 2017. I will have final 2016 numbers for your review in a couple of weeks.
So let’s a look a brief look at a vanishing component of the residential market and that is the distressed market; those homes listed as either a short sale, bank owned, or HUD property and you will be as surprised as I was to learn that just 12 homes are currently listed in that category. That’s just 4% of the total available inventory. I negotiated short sales from 2007-2010 and can remember when 70%+ of the residential MLS market was distressed so we have come a long way in 6 short years. In terms of distressed sales for 2016, just 69 properties sold, selling at an average of $72.44 per square foot and accounting for just 4% to maybe 5% of total 2016 sales. I don’t anticipate much change in this aspect of the market as there is always some level of distressed properties regardless of how healthy the market is, but for those of you looking for investments and flip opportunities, you will need to keep a steady eye on this market and act fast when the opportunity arises.
On a commercial note, the Edison Pointe development began site preparations this week. Edison Pointe is a 15 acre site just south of the Fry’s Marketplace that will be home to 130,000 square feet of retail and restaurants and is also located across the street from the new Culver’s restaurant which is nearly completed and set to open within the next month. Big 5 Sporting Goods is also scheduled to open soon and is located at the Shea Wells development out by Walmart. 2017 is setting up to be a very good year for residential and commercial development and more importantly, 2017 could be a big year for home value appreciation for current home owners, and considering that interest rates could very well rise towards the end of the year, those of you looking to purchase this year should start that process now. Have another great week.