Sedona Market Update – first Half of 2010

The overall market seems to be stabilizing, with the exception of the luxury segment. We are still seeing an increase in the number of residential sales. Due to a steady supply of foreclosures and short sales, prices remain at their lowest since 2003. The good news is that they seem to be leveling out.

The number of luxury home sales is up from the first quarter of this year, but it is still down from the first half of 2009. Prices continue to drop.

Land sales continue strong.

Single family home sales: With 219 sales in the first half of this year we are up 50% from 146 sales at the same time in 2009.
The median recorded sales price of $385,000 is very close to what we saw at the end of the first quarter ($390,000) and 10% down from the first half of 2009 ($429,500). The price per square foot at $175 is stabilizing ($177 at the end of the first quarter). 
Inventory is down at 362. At the end of June 2009 we had 397 active listings and 517 at the same time in 2008.
78 homes are pending.

Luxury homes: The price point of the top 10% sales (which defines a luxury home) is still down from $1,000,000 to approx. $750,000.
In the first half of this year 7 homes sold over $1,000,000. This is up from only 1 comparable sale in the first quarter, but still down 28% from 9 sales in the same time in 2009.
The median price of $1,130,000 is down 16.3% from last year ($1,350,000).
The average price per square foot of $255 is down 18.3% from
last year’s $312.

Vacant land: with 45 sales in the first half of this year, sales are up 36% from the 33 a year ago. The trend is still up but slowing down compared to the first quarter. The median sales price of $160,000 is 33% higher than a year ago but down from the $207,000 at the end of March. Inventory with 413 is slightly up compared with 403 active listings last year.
Close to 30% of the active listings are bank owned REOs or short-sales.

Sedona Market Update - first Quarter 2010

The signs are encouraging. In the first quarter of this year sales of single family homes have doubled compared with last year. Prices are still at their lowest level since 2003. Inventory is down and demand is up. But a steady supply of foreclosures and short sales is keeping the market at the present low level, as it forces regular sales to compete with their prices.

Luxury home sales are lagging behind.
Land sales are clearly picking up.

Single family home sales: With 99 sales in the first 3 months we are up 98% compared with the 50 sales in 2009.
The median recorded sales price of $ 390,000 is down 9 % from the first quarter of last year ($427,000) and the average price per square foot is with $177 about 11% under the price at the same time of 2009.
Part of this drop is due to only one $1,000,000 + home selling (luxury sales bring up the average price per square foot).
Inventory is down at 375 compared with 459 at the end of March last year.
With 75 pending homes we are seeing the highest number at the end of a first quarter since March of 2006.

Luxury market: In the first quarter of this year only one $1,000,000 + home sold. The lowest number in the last 10 years.
At the same time we have 86 active listings in the $ million range and 6 pending homes at the beginning of April.
The price point of the top 10% sales (which is the luxury market) has come down from originally $1,000,000 + to $750,000.

Condos: 13 condos were sold in the first 3 months, compared with 96 active listings. 12 Condos were pending and the median sales price was $299,000.

Vacant Land: Land is on the up. Compared with 2009 sales have quadrupled. 5 sales in the first quarter of last year compared with 20 sales this year.
The median sales price was with $207,000 clearly higher than in the year 2009 ($135,000).
At the same time there are 403 active land listings and 14 pending.

Sedona Real Estate Market Analysis 2009

The overall market has leveled out and is starting to sail in calmer waters. Prices are down to the level of 2003/04, but that makes it a great market for buyers. And buyers have started to show up and take advantage. Competition with foreclosures and short sales has brought prices down below re-build cost. That coupled with all time low interest rates is bringing buyers and investors back. Properties that are priced competitively are selling.

Sales of single family homes:
The number of residential sales has gone up for the first time since the record number of 599 sales in 2003. After a steady decline we hit rock bottom in 2008 with 227 sales. 2009 shows a jump of 52% (!) to 344 sales.

At the same time the median recorded sales price of $398,000 is down 17% from $480,000 in 2008.
The median price per square foot of $182 is down nearly 22% from $233 in 2008. During 2009 the median price per square foot remained steadily close to $190.
These prices are comparable with prices in 2003/2004.

59% (202) of the single family home sales were traditional sales.
10% (36) were short sales and 31% (106) were bank-owned/foreclosures.

Encouraging: the number of active listings decreased by over 26% - from 459 at the end of 2008 to 338 on 12/31/09.

Luxury market (homes $1,000,000+):
While the overall number of single family home sales has jumped up, the number of luxury home sales decreased.
While 25 luxury homes sold in Sedona in 2008, only 19 sold in 2009 (down 24%). Way down from our high of 55 sales in 2006 (65.45%!).
In the beginning of the real estate recession luxury home prices held firm, while prices in none-luxury homes declined to compete with foreclosures and short sales. At that time the only sign of a declining market for the luxury segment of the market where decreasing number of sales.

As we started to see short sales and foreclosures in this part of the market and due to the few sales, prices have started to drop significantly.

Statistically the number of active listings has come down from 93 at the end of 2008, to 85 on 31/12/09. But the reason is that a large number of former $1,000,000+-homes dropped their prices under the $1,000,000-mark.

The average price per square foot in 2009 was noted with $341. That seems fairly stable compared to $ 343 in 2008, but does not reflect the fact, that the buyers got more for their money: higher quality, newer homes, bigger views and more space.

At the end of 2009 only one home was pending.

Condos/Townhomes:
With 54 units sold in 2009 compared to 55 in 2008, the number of sales shows fairly stable. (The high was 154 sales in 2003.)

The average price per square foot of $232 in 2008 dropped 11% to $207 in 2009.

81% or 44 sales were traditional sales.
9 or 17% of the sales were foreclosures and only 1 sale was a short sale.

Vacant land:
After 5 years of declining sales numbers, the number of sales has jumped up 64%(!) from 58 sales in 2008 to 95 sales in 2009.

At the same time the median recorded sales price dropped from $300,000 in 2008 to $135,000 in 2009. A drop of 55%!
With prices back to the level of 2001, buying land and building is becoming interesting again.

And given the limited supply of land in Sedona - being an island surrounded by Forest Service - land is an excellent investment for investors that have cash to spare.

Overall: Arizona is one of the states with the highest growth rates. Recent demographic studies expect the population of Sedona to grow from 10,700 presently to 15,360 in the next 15 years. The projected numbers for the rest of the Verde Valley are even higher.

Sedona with its unique beauty, great life style and limited supply of land promises strong appreciation in the future.

As the real estate market starts to recover nationwide we are expecting sales in Sedona to continue to accelerate. Buyers, who had to sell their home in another state to move, are starting to sell.

Financing proved difficult this last year. As a reaction to the bank and finance crises lenders swung from loose requirements to seemingly unnecessary conditions and restrictions. The same can be said for appraisals. Swinging the pendulum back to a sound middle would help sales and the further recovery of the real estate market.

After a long and extreme decline of real estate sales and values we have hit rock bottom and are poised for recovery.

Sedona Market Update January - September 8, 2009

In short: The number of residential sales continues to pick up. Prices seem to have leveled out at a price point comparable to 2003/04.  Part of this is due to the fact that 40% of the sales since January were foreclosures and short sales. This forces sellers to price competitively.

Inventory continues to decrease. In June of 08 we had 525 active residential listings. While we had 530 active listings on 9/1/08 we were down to 371 (30%!) at the beginning of September this year. A very encouraging sign.

Luxury home sales are still below last year’s sales.
Condo/Townhome sales are slowly picking up.
Vacant land sales are picking up in numbers while or because prices have dropped to a price level we have seen in 2001.

Sales of single family homes:  with 207 sold homes, sales are up 36% from last year’s 152 sales in the same time period (January – August).

At the same time the median recorded sales price of $422,500 is down 14% from 8/31/08. The good news is that it has slightly recovered. It was down 17.5% at the end of June this year. (We hit the price bottom in January with $341,000.)
The reported median price per square foot with $192 is down 21% from 2008 – also a slight recovery from being down 26.5% at the end of June 09.
With 87 pending homes we are seeing another all time high (74 in June of 05 and 78 in April of 2009).
Encouraging: the number of available homes continues to decline – from 525 in June of 08, to 449 at the end of April 09 to 371 at the beginning of September 2009!

Luxury market:  with 13 sales of homes over $1,000,000 we had fewer sales than in previous years (18 in the same time period in 08, 37 sales in 07). The average price/sq.ft. for luxury homes sold was down to $353 from $408 at the same time in 2008.
 
Condos/Townhomes: with 28 sales in the first half of 2009 we were slightly down from the 31 sales in the same time period of 2008 and the 33 in 2007. By the end of August 39 sales were recorded with an average price per square foot of $223 - slightly less than in 2008.

Vacant land sales: the median recorded sales price has dropped significantly from $345,000 in the first half of 2008 to $120,000 in the same time period in 2009! (A drop of 65%!) At the end of August it was $121,000.
After a several year long decline, we are seeing rising numbers of sales – 46 January - August 2009 compared to 37 in 2008. We are back to a price level comparable to 2001. Buying land and building might soon be interesting again.

Update August 09 / January – July

In short: Trends of last update (see below - July 09) are continuing.

Sales of single family homes: with 177 sold homes we are up 36% from the 129 sales in 2008.
The median price per square foot of $189 pretty much stayed the same as in the first half of this year, but it is down approx. 22.5% from the $244 we saw at the same time last year. 

Only 11 out of the 177 sales are homes over $1,000,000.

Condos/Townhomes:  sales have slightly picked up in July. With 33 sales in the first 7 months we have the same number of sales as in 2008. The price per square foot with $232 is lower than the $240 last year and slightly higher than in the first half of this year.

Vacant land: 4 more sales in July add up to 39 for the first 7 months of this year. This number is slightly higher than the 35 sales last year. But the median price per lot of $122,000 is drastically lower than the median sales price in 2008 of $332,5000.

Update July 09 / January – June 2009

In short: The number of residential sales continues to pick up. At the same time prices are still falling.  Part of this is due to the fact that 38% of the sales since January were foreclosures and short sales. This forces sellers to price competitively.

Inventory continues to decrease. In June of 08 we had 525 active residential listings. This number dropped to 449 at the end of April and was down to 397(!) at the beginning of this month. A very encouraging sign.

Luxury home sales have picked up but are still below last year’s sales.
Condo/Townhome sales are only slowly picking up.
Vacant land sales are picking up in numbers while or because prices have dropped to a price level we have seen in 2001.

Sales of single family homes:  with 146 sold homes, sales are up 29.2% from last year’s 114 sales in the same time period (January –June).

At the same time the median recorded sales price continued to drop 17.5% from $520.000 in 2008 to $429.500 in 2009. The reported median price per square foot with $188 is even down 26.5% from 2008.
With 80 pending homes we are seeing another all time high (74 in June of 05 and 78 in April of 2009).
Encouraging: the number of available homes continues to decline – from 525 in June of 08, to 449 at the end of April 09 to 397 at the beginning of July 2009!

Luxury market: with 9 sales of homes over $1,000,000 we had fewer sales than in previous years (13 in the same time period in 08, 30 sales in 07). At the same time there was a jump up from the 3 homes that were sold by the end of April 2009 (6 homes sold in the previous two months – 3 in the four months before!). The average price/sq.ft. for luxury homes sold was $348.

Condos/Townhomes: with 28 sales in the first half of 2009 we are down from the 31 sales in the same time period of 2008 and the 33 in 2007. But we there was a jump up from the 15 condo and townhome sales that were recorded till the end of April of this year! – The average price per square foot of $225 is down from $240 in 08 but up from $209 at the end of April 2009.

Vacant land sales: The median recorded sales price has dropped significantly from $345,000 in the first half of 2008 to $120,000 in the same time period in 2009! (A drop of 65%!)
After a several year long decline, we are seeing for the first time a rising number of sales – 33 in the first half of 2009 compared to 29 in 2008. (At the end of April we had only 12 recorded sales. This number nearly tripled in the last two months!) We are back to a price level comparable to 2001. Buying land and building might soon be interesting again.

Sedona Real Estate Market Analysis - April 2009 

What a year! The economy and the finance- and investment markets have been shaken up and so have the Real Estate markets. Sedona is no exception.

Between 1998 and 2002 the number of single family homes sold in Sedona rose continuously from 403 in 1998 to 520 in 2002. In 2003 the number of sales reached a peak of 599 homes sold with an average price of $168 per square foot. (The price per square foot includes the land.)
In 2004 and 2005 the number of sales stayed high with 591 and 582 sales, while the average price per square foot rose from $195 in 2004 to $248 in 2005.

Interestingly the price per square foot of sold homes continued to climb to a record high of $284 in 2006 while the number of sales dropped to 386.

This number steadily declined to 254 sales of single family homes in 2007 and 227 in 2008 (60 + % down from the peak years of 2003 – 2005!)
The average price per square foot dropped at the same time from $270 in 2007 to $233 in 2008. And it looks like we hit rock bottom at the end of last year.

In spite of the high inventory – 459 active listings on 3/31/09 (down from 517 on 7/1/08) – and more foreclosures and short sales coming into the market, we are seeing positive signs: rising sales in California, surging sales in the devastated Phoenix market as well as a rising number of sales in Sedona.

While we saw 45 sales of single family homes in the first quarter of 2008, there were 50 sales in 2009. At the same time the price per square foot has continued to decline to  $208, a price comparable to 2004 and 2005 before
the market sky-rocketed.

With 43 pending homes at the end of March we are seeing a number higher than 2006 before the market crumbled down and about three times as many as in December 08 (15 pending homes). An encouraging sign.

More sales are the first step to stabilizing the Real Estate market by absorbing the high inventory. Incredible deals paired with historic low interest rates seem to start pulling buyers and investors off the fence.

Interestingly only 3 of the 50 homes sold in the first quarter of 2009 sold over $1 Million and 47 sold under. The market seems to be picking up in the single family homes under $1 Million while the luxury market is still slow (3 sales in the first quarter of 2009 compared with 5 in the same time of 2008 and a median sales price of $1,348,500 this year compared with $1,600,000 last year).
Part of this can be contributed to the fact that prices have dropped so much, that a number Million $ homes have dropped below the $1 Million mark.

Vacant land is quite a different story. With homes priced so low that it is not possible to build a home any where near the prices we are seeing in residential sales and the fact that there are hardly any land loan programs out there at this time, land sales have dropped to a low of 5 sales in the first quarter of this year compared with 13 sales in 2008, 9 in 2007, 21 in 2006, 17 in 2005 and 28 in 2004. The median sales price in the first quarter of 2009 was $225,000 compared with $390,000 in 2006.

This is one way of looking at it. On the other hand incredible land deals are to be had if somebody is able to buy with cash. And given our limited supply of land (being an island in the middle of National Forest) good appreciation can be expected in the future.

Condo and Townhome prices and sales are still down. The median recorded sales price in 2008 was $295,000 which compares to sales in 2004 and 2005 ($279,000 in 2004 and $312,000 in 2005).

With 55 sales in 2008 we are seeing a record low. (59 sales in 2007, 86 sales in 2006, 111 sales in 2005, 129 sales in 2004, 154 sales in 2003, 150 sales in 2002 and 134 sales in 1997).

The average price per square foot of $225 is close to the prices we saw in 2004, when the average price per square foot of Condos and Townhomes was $211.
Condos and Townhomes are more often than not bought as a second home or holiday get-away. In an economically challenged time many potential buyers are holding off on spending money on a second home. On the other hand it is a good time to get an amazing deal.
 

The Sedona Real Estate market has either hit its bottom or is very close to it. Many available listings in all categories do not reflect the value of the property anymore but how desperate the owner or the bank is to sell it. With interest rates at an historic low it is an investor’s paradise and the right time to buy. Investors understand that and are starting to come back into the market.

Many who have lost money in the stock market are now starting to think how to gain back their losses. And Real Estate has always been a good investment in uncertain times.

Arizona is the state with the highest growth rate.  And Sedona with its unique beauty, great lifestyle and limited supply of land promises good and strong appreciation in the future. Once the Real Estate market nationwide starts moving, we will see sales in Sedona strongly accelerating, as many are waiting to buy in Sedona but cannot sell their homes at the present time.

If you have any questions or are interested in learning more about the Sedona Real Estate market and its current opportunities, just call me at  (928) 300-6567 or send me an email at gilasedona@aol.com