Scottsdale Condo Prices Continue to Fall

by Dru Bloomfield on April 12, 2010

Yes, it’s true, listing prices for Scottsdale condos continue to decline….

….in all price ranges.

The statistics for the properties in this following report are divided as follows:

First Median Range (Blue): Most expensive 25% of properties
Second (Green): Next 25%
Third (Orange): Next 25%
Fourth (Black): Least expensive 25% of properties

However, the time to sell appears to have stabilized, with active listings currently hovering just under 150 days to sell, since January 2010.

Interestingly, the time to sell lower priced condos is increasing, while those on the upper end are selling more quickly. This could have a lot to do with the challenges of getting financing, particularly FHA financing, for condos.

Data Source: Altos Research

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What’s up with Scottsdale home prices? How long is it taking to sell a house? — At Home In Scottsdale | Scottsdale Real Estate for Buyers and Sellers: 04.19.10 at 8:12 am

{ 10 comments… read them below or add one }

Dean Ouellette 04.12.10 at 8:01 am: Dru, great topic. I had this conversation with an investor a few weeks ago. While it seems the housing market prices are stabilizing, condo market has shown no signs of that at all
.-= Dean Ouellette´s last blog ..Top 10 real estate posts of the day for 4/12/2010 =-.
Grant Hammond 04.12.10 at 1:34 pm: Hi Dru,

Is the median price drop in condos a direct result of foreclosures and short sales or is it because of developers reducing prices on their inventory?
.-= Grant Hammond´s last blog ..Real Estate Tax Credit Causes Nashville Homes Sales to Soar =-.
Dru Bloomfield 04.12.10 at 8:16 pm: Dean, Will be nice to eventually see some recovery, won’t it?

Grant, We don’t have any land left in Scottsdale. There a few condo conversions, but not really many new builds. Short sales are much more prevalent in Scottsdale than foreclosures, and we are starting to see more “typical” sales. I really do think most of the problem is related to the dramatic depreciation, coupled with the lack of financing options.
Grant Hammond 04.13.10 at 5:20 am: That does make sense. In Nashville many of the condo developments are literally scrambling to attain FHA certification prior to the end of the these temporarily favorable qualifications of 30% under contract and/or sold.
.-= Grant Hammond´s last blog ..Real Estate Tax Credit Causes Nashville Homes Sales to Soar =-.
Terry S. Smith 04.19.10 at 8:51 am: The drop in condo prices in mainly due to FHA changing their guidelines.

This eliminated almost all condos not just in Scottsdale but all over Maricopa county.

Bottom Line: FHA does not want to guarantee any loans made for condo right now. When they reverse or loosen the current guidelines will be the time to buy condos.
Grant Hammond 04.19.10 at 9:26 am: Terry – just wait until the guidelines reset in 2011. Going to be very interesting for all condo developments.
.-= Grant Hammond´s last blog ..Q1 2010 Nashville Condo Closings =-.
Irene Hammond 04.19.10 at 11:15 am: I know I have had clients that haven’t been able to find anything they liked because of the FHA guidelines. One client decided to not buy at all. Another is saving more money so she can go conventional.
.-= Irene Hammond´s last blog ..Why isn’t the bank doing a short sale? =-.
Dru Bloomfield 04.19.10 at 11:38 am: Grant, Tell me more about the 2011 reset. I’ve not heard of it yet.
.-= Dru Bloomfield´s last blog ..What’s up with Scottsdale home prices? How long is it taking to sell a house? =-.
Grant Hammond 04.19.10 at 11:46 am: Here are the major points:

Concentration of FHA loans in a project – For case numbers ordered prior to 1/1/11, FHA will allow up to 50% FHA concentration, meaning 50% of the condo units in a project can have FHA financing. Starting 1/1/2011, the FHA concentration limit will be reduced to 30%. The HUD website will post concentration percentages for each condo project.

Owner Occupancy – For projects that are proposed, under construction or still in their initial marketing period, FHA will allow us to calculate the 50% presale based on pre-sold units. REO units may be excluded from the calculation. This is a temporary change that only applies to case numbers ordered before 1/1/11. In 2011 these pre-sales will not count.

Pre-sale – The required pre-sale for New Construction projects is temporarily reduced from 50% to 30% for case numbers ordered before 1/1/11. It will increase to 50% on 1/1/11.
.-= Grant Hammond´s last blog ..Q1 2010 Nashville Condo Closings =-.
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