The State of Central Phoenix Foreclosures
It isn’t exactly breaking news that the entire state of Arizona struggled through the real estate crisis and economic recession. However, for falling as low as it did, the region sure has made a strong and quick comeback.
For several years the number of foreclosure homes in Arizona and Central Phoenix was among the highest in the nation. Today, the state is among the lowest in foreclosures.
The Central Phoenix housing inventory contains less than one percent of bank owned properties, which is a huge decline from the 19,831 foreclosures reported in 2013.
Since the market collapsed in 2008 and 2009, the journey towards a healthier economy and real estate market has been very slow. The good news is that in the past year, there has been steady growth throughout the nation and Central Phoenix has made a huge comeback.
Let’s take a look at the state of Central Phoenix foreclosures in the past, present and future.
Past History of Foreclosures
In 2010, the entire state of Arizona reported close to 70,000 home foreclosures.
That number is actually 12 percent higher than the reported number of foreclosures in 2009.
In 2010, unemployment rates were high, home values were dropping quickly and Central Phoenix alone accounted for two-thirds of the state’s foreclosures. Many banks and lenders took their time processing foreclosures in order to give homeowners a chance to work something out and save their homes.
In fact, Bank of America took an average of 560 days to even begin foreclosure proceedings. There was even bad news for homeowners who were lucky enough to keep their homes. Most homeowners owed more than their home was worth! It seems like it was such a long time ago doesn’t it?
Especially considering how significantly the Central Phoenix market has improved in the past year and a half alone.
Just last year, the Phoenix Business Journal reported that although foreclosures in Central Phoenix significantly slowed down, the state as a whole still posted one of the highest foreclosure totals over the year.
Present State of Foreclosures
Although recovery has been slow, Central Phoenix is at the forefront leading the way with a stable job market and rising home prices.
In 2013, the state of Arizona added nearly 52,000 jobs and is projected to add another 60,000 this year.
Economists say that this is considered modest growth, but they agree that Arizona is on track to being one of the fastest growing markets. The market crash and housing bubble really scared homeowners and in turn this has made them more cautious.
This is turning out to be a good thing, because homeowners are beginning to owe less than their home is worth and this is significantly cutting down on short sales and foreclosures. Currently mortgage rates are low and home prices are increasing.
The only downside is that the inventory is also fairly low, which in turn makes competition extremely high among motivated buyers. All those foreclosed homes from 2010 are also quickly being bought out and the inventory for reasonably priced homes is quickly dwindling.
Future of Foreclosures
The Central Phoenix residential market improved by leaps and bounds last year, but it is still far from its pre-recession boom.
Industry experts and economists are still expecting modest improvements this year as foreclosures are still weighing down the market. Although there are positive signs of recovery and foreclosures are slowly tapering off, they are not where they should be.
Foreclosures and short sales are dragging down resale home prices. There won’t be a significant rise in resale prices until foreclosures drop to a normal level.
The good news is that there are many programs in place to help homeowners avoid foreclosures. Lenders have even admitted that working out a loan is preferable to foreclosing on the loan. There are also many new developments being built, which offer buyers more options and should ultimately pull people out of the resale market.
Just last year industry experts were predicting another foreclosure surge. That never happened, and although foreclosure rates are still extremely high, they have dropped significantly.
Capitalizing on the Foreclosure Market
Though the real estate field is generally unpredictable, most economists agree that for 2014 growth and improvement will continue. It may be slow, but it will be steady.
The Central Phoenix real estate outlook for 2014 predicts stability and development.
If you are thinking of buying a Central Phoenix home or a Central Phoenix condo, now may be the best time to do it. Interest rates are extremely low and we can help you find your dream home at a reasonable price.
Contact us today for help.