• Single Family Home Average Sales Price: $210,522
• Single Family Home Median Sales Price: $167,500
• Single Family Home Units Sold: 801
• Single Family Home Months of Inventory: 6.9 months

• Townhouse Average Sales Price: $139,228
• Townhouse Median Sales Price: $125,000
• Townhouse Units Sold: 71
• Townhouse Months of Inventory: 8.7 months

• Condo Average Sales Price: $102,581
• Condo Median Sales Price: $99,000
• Condo Units Sold: 33
• Condo Months of Inventory: 13.0 months

• Citywide Average Sales Price: $200,993
• Citywide Median Sales Price: $160,000
• Citywide Units Sold: 905
• Citywide Months of Inventory: 7.2 months

Turns out, October was a lot like September.  The average sales prices continue to drop, but the number of homes sold is increasing, the number of pending sales is still high, and the number of new listings is up a bit too.

All that activity is concentrated in the lower price ranges, especially in the sub $150,000 market.  In fact, there’s less than 5 months of inventory in that price range – meaning there is decent demand for those homes.  That would make sense, given the $8000 tax credit incentive to close before the end of November.  As I write this, the vote to extend the tax credit was passed by the Senate and was sitting in front of the House…

I’ve been asked several times about what the future for Tucson’s housing market holds.  There are so many factors – that tax credit extension, mortgage resets, the holidays coming up, there are too many to list.  I’m willing to say that our housing slide has slowed – at least for the time being, but I’m not convinced it has stopped.

Here’s why:

If you track the change in average and median sales price  month to month, you get an idea of the rate of change of the market – how fast it is going up or down.  So in 2006, every month the average sales price went down 0.4% on average.  The median sales price went down 0.1% on average.

If you look at 2008, you can see how bad of a year that was.  Home prices were falling fast – 2% a month on average. 

If you look at data from 2009 to date, we’re down 0.4% a month, which is slower than before.  Note that the median price drop on average per month is 0.7% – you can see the shift in the price ranges of homes that are selling because that median value is centered around the bulk of the sales happening in those lower price ranges.

As always, there are extensive charts and statistics and whatnot, broken down by area and type of housing, over at my Tucson market statistics site. The market in this city varies widely from one end to the other, so you can check out what’s going on in your area over at that section of my site.

Data gathered from the Tucson MLS and is deemed reliable but not guaranteed. Figures quoted here include only single family homes, townhomes, and condos in the 9 areas that make up the Greater Tucson Area: NW, N, NE, W, C, E, SW, S, and SE.

There are workshops in two weeks for the public to discuss how businesses and neighborhoods will be accessed from the new Grant Road.  If you live anywhere along that corridor, or have interests in those businesses, it might be useful to attend.

If you do, you’ll learn about how drivers will enter/exit the roadway using shared driveways and new median openings.  You’ll also be able to provide input on the preliminary design, the streetscape, the landscape, and public art.

The Grant Road task force would appreciate an RSVP though, by emailing information@grantroad.info, or by calling (520) 624-4727.

To discuss Swan to Country Club area, the workshop is November 16th, 5:30-8:30pm at the Tucson Association of Realtors office, 2445 N Tucson Blvd.

To discuss Oracle to 1st Ave, the workshop is November 18th, 5:30-8:30pm at the Pima Downtown Campus Amethyst Room, Building CC, room 180 at 1225 N Stone.

To discuss 1st Ave to Country Club, the workshop is November 19th, 5:30-8:30pm at the Tucson Association of Realtors office, 2445 N Tucson Blvd.

As always, you can find more info at the Grant Road project site – www.GrantRoad.info.

Answer – depends on what time period you look at. 

Let’s start with home prices.  Will they continue to go down over the next month?  Most certainly.  Over the next year?  It’s likely.  Over the next 5 years?  Maybe not.  Over such a long term, there’s no way to accurately predict.

If you look at the average sales price for homes in Tucson over the last few years, you can see the decline.  I’d argue that the drop in home prices is slowing a bit, but there are several factors in play that could make that change – the availability of financing, the levels of inventory, the economy as a whole impacting salaries and the ability to buy and sell a home.

If we look at mortgage rates, there’s some seasonality there too.  I talked about that earlier in this post about rates going up or down.  History says rates go down in the fall.  But again, there are larger factors at play. 

AND – rates are changing rather quickly, as Dan points out in this article about how long a rate quote lasts over the past 2 months.  Lenders are changing their pricing often, which changes your rate often. 

So why ask if rates and prices will continue to decline?  Trying to time the market, buy at the best possible price and rate?  I guess you can try.  But you’ll never know if we’re really at bottom until we’ve already left it.  It’s all just part of the risk you take by deciding to buy or sell at any particular time.

Would you buy the perfect house if it had terrible cell phone reception?

Most people shop around for a home according to the features of the home – number of bedrooms, area, general condition, etcetera.  But very few people will pull out their cell phone to see if they get reception there.  Tucson, in my experience, has decent cell service, except for the Foothills and some very bizarre black holes in midtown.

Oh, except for my clients with iPhones.  You can barely even call those people half the time…

But back to the scenario.

How important is cellular reception in your list of home needs?  If everything else was right about the home, would you still buy it if there were terrible reception in the area?

I’m curious.  Tell me what you think in the comments below!

So this week, I’ll formally change my license over to become the new Tucson branch of Thompson’s Realty.  Thompson’s Realty is a brokerage owned by my friend Jay Thompson, who works out of the Phoenix area.  He’s another real estate blogger and we run our businesses much in the same way, with similar methods and philosophies.  Overall, it will be a good move.  (And I’m sure he’ll be adding Tucson to the Thompson’s Realty site soon… Right Jay?)

For you, dear reader, you’ll notice the logo on my site will switch to a new one.  But it’s still me, offering the same services and benefits, just under a different brokerage name.

In fact, switching to Thompson’s Realty means I get to go even more electronic and mobile.  Creating and signing contracts and other documents with my clients anywhere, anytime.  No more being tied to fax machines and copiers.  Electronic signatures.  More efficient communications during transactions, precise systems to manage the transaction and timelines on the back end.

I’ll explain some of that new stuff over the coming weeks, let you know how it works and why I think it will be a huge benefit to my clients.

In the mean time, if you need me, I’m still where I always was.  Right here.

You can’t really say, can you?

Every so often, I get asked about price per square foot – what is the average price per square foot in Tucson?  Really, it isn’t an answerable question.

Think about what that price per square foot figure really tells you – the price and how large the house is under the roof. 

What it doesn’t tell me is what condition the house is in, if it has an air conditioner, a pool, a 3 car garage.  It doesn’t tell me anything about the lot size or the location.  Doesn’t tell me if the house has been updated or not.  Doesn’t tell me if that’s a five bedroom house with only one bathroom, if the house is 5 years old or 50, or if there have been unpermitted additions.

In fact, the only time looking at price per square foot makes sense is when you’re looking at a collection of very similar homes – homes of similar size, age, location, condition, and lot size.  That’s what we do when we try to determine market value for a home, either to help a home buyer craft an offer, or a home seller price their house.  If we can pull together a collection of very similar homes, then yes, we can start talking about price per square foot.  Otherwise, comparing price per square foot on homes in different areas is really just extra and misleading information.

Naturally, I was terrified.  I am not exactly athletic.  But I consulted with my scale and figured it was worth a shot.

Turns out, bootcamp in the park is actually pretty enjoyable.  Well.  Maybe enjoyable is the wrong word.  It’s a tough workout, but it can be adapted to pretty much any level of fitness.  My heart rate monitor says I regularly burn between 550 and 700 calories during the hour of exercise. 

But it isn’t the various exercises that keep me coming back.  It’s the people.  There’s a community of folks there to struggle along with you, encourage and assist you when you need it – and I’m there to do the same for them.  Unlike going to the gym to hit the elliptical on my own for an hour – which I could never stay motivated to do for long – I go work out with a group of people, comprised of a wide variety of body sizes and ages, and we make it through together.  It’s like a built in motivation and accountability system.  And I’m a huge fan.

AND.  It is Urban Athletic’s 2 year anniversary, so they’re celebrating with a discount.

If you sign up during October for the next session (here’s the workout schedule – it varies by location), use the coupon code "anniversary" to get $100 off your registration.

From Paul Rose, one of the owners:

Urban Athletics started as a way to prove to ourselves that we could get an incredible workout, no matter where we were.  We started coming up with routines that would engage the whole body, which triggers a faster metabolism. What started as just a few friends working out in the park, has turned into a proven exercise method that works for anyone.

In our two years of training we have seen amazing results with out clients. Seeing people completely change their body type is the most gratifying part of the job – I think we help show that getting into great shape doesn’t mean changing your entire life, just a few small things.

The cookie filled holidays are approaching…  Work off your future cookies now.

If we trust history, mortgage interest rates should continue to decline into 2010.  The information in the chart below is from Freddie Mac, since 2006.

However, we’re in a different market than we have been in the past few years.  There are several conditions that have an upward push on rates – the Fed is ending mortgage market support, inflation concerns on Wall Street, the weakened US Dollar. 

Seasonally, rates should go down.  Current conditions say they might go up.  Will we break trend this year?

Hard to say.  If you’re trying to time the market for the lowest rate, you’d better be paying close attention.  As should your lender, to alert you in time for you to lock your rate. 

Check out the full story here.

I had two decent comparable sales to use – but I noticed one sold to a buyer who used FHA.  And that’s a huge flag that more research needs to be done in order to use that sale as an indicator of market values.

See, many FHA home buyers in Tucson ask for closing cost assistance, if not also down payment assistance.  And those are in the form of credits directly to the Buyer at close of escrow, which isn’t recorded as part of the sales price but comes directly off the Seller’s bottom line – the Seller actually walked away with less money than what the sales price would indicate.

It’s easier to understand with an example.

Let’s say you just sold your home for $200,000.  With a regular home buyer, you’d get a check for $200,000.  (We’re simplifying here for the example, and disregarding other sales costs and loan amounts.)

If you had an FHA buyer who needed 3% of the purchase price towards their closing costs, you’d get a check for $194,000.

If you had an FHA buyer who needed 3% towards closing costs and 3% towards their down payment, you get a check for $188,000.

The assistance just comes off the Seller’s bottom line.  And if a Seller is willing to take less in the form of closing cost and down payment assistance, then it’s the same as if they sold their home for that lower value.  Paying $12k in closing cost assistance is the same as taking $12k less for the house.

So if I’m using that house to find market value, and the seller took what equates to 6% less than what the sales price indicates, then clearly, that impacts market value.

The sales price isn’t always the whole story.  There are all kinds of credits that can happen on the back end of the transaction that aren’t necessarily reflected in the record of the sale in the Tucson MLS.  You always gotta do the research.

• Single Family Home Average Sales Price: $217,013
• Single Family Home Median Sales Price: $170,000
• Single Family Home Units Sold: 714
• Single Family Home Months of Inventory: 7.6 months

• Townhouse Average Sales Price: $140,385
• Townhouse Median Sales Price: $135,450
• Townhouse Units Sold: 71
• Townhouse Months of Inventory: 7.9 months

• Condo Average Sales Price: $108,312
• Condo Median Sales Price: $108,000
• Condo Units Sold: 40
• Condo Months of Inventory: 10.9 months

• Citywide Average Sales Price: $205,148
• Citywide Median Sales Price: $165,000
• Citywide Units Sold: 825
• Citywide Months of Inventory: 7.8 months

Where did September go?  The year is flying by…

We’re heading into our winter slow-down.  Activity is actually a little higher than I expected, especially in the lower price ranges.  There are lots of buyers out there trying to take advantage of that $8000 tax credit – and they all need to close on a home by the end of November.

In fact, home sales in the under $200k range were 67% of our market in September.  Prime first time buyer home territory.  We see this activity further verified in the number of pending sales – 2090 units, up well over a hundred units from last month in a season where sales should be slowing down.  Given the higher number of pending sales, we ought to see that effect the number of sold units next month.

The average and median sales price citywide in Tucson made a small decline, coming to $205,148 and $165,000, respectively.  Active listings went up a bit, to 6416 units, compared to 6374 last month. 

The South side of Tucson had a very interesting September this year.  There were 100 sales in South Tucson, where last month there were only 73, leaving the area with 4.9 months of inventory, an incredibly low figure, given the general market conditions.  Despite the increased activity, the average sale price on the South side was still down from last month.  It’s an area hit hard with foreclosures and short sales – perhaps prices there have reached the point where they’re becoming attractive again.  42 of those homes were bought with FHA financing, which would be those first time buyers again.  34 were bought with cash – possibly investors picking up bargains.

As always, there are extensive charts and statistics and whatnot, broken down by area and type of housing, over at my Tucson market statistics site. The market in this city varies widely from one end to the other, so you can check out what’s going on in your area over at that section of my site.

Data gathered from the Tucson MLS and is deemed reliable but not guaranteed. Figures quoted here include only single family homes, townhomes, and condos in the 9 areas that make up the Greater Tucson Area: NW, N, NE, W, C, E, SW, S, and SE.