Paul Slaybaugh did a great job in his blog of pointing out how affordability has been restored to the Scottsdale Arizona Real Estate Market. He also talks about people hearing opportunity knocking but not opening the door and regretting it afterward.
Paul motivated me to run some quick stats on my town, Manalapan, New Jersey to see how we stacked up on the affordability scale.
The numbers aren't quite as staggering as they are in Scottsdale, but still meaningful.
I looked at Single Family Home Sales priced under $400,000.
- In 2006, 13% of total homes sold were priced under $400,000
- 2007 saw an increase to 17%
- 2008 21% of total sales were priced under $400,000
Confirming my belief that affordability is quickly being restored to the Manalapan Real Estate Market.
Expanding to neighboring Marlboro New Jersey, the impact is even greater.
- In 2006, 5% of total sales closed under $400,000
- In 2008, that number soared to 15% of total sales closing under $400,000.
When I first got into this business a decade ago, it didn't take long to encounter one of the favored pastimes of consumers and professionals alike: Reveling in prices that once were.
Whether it was the colleague pointing out a development where he lamented not purchasing five units back when they could be had for $75,000 apiece, or the investor who regretted selling that rental property years before now that it was worth three times as much, the underlying wish was to turn back the clock to grab as much Real Estate as humanly possible at the never to be seen again values.
Of course, the downside to the markets that spawned the low price housing in Scottsdale in years past was diminished purchasing power due to elevated interest rates, and the speculative nature of our community. Always a winter haven for the well-heeled, we were still very much a community in progress. All the signs pointed to a city on the upswing, but with abundant raw land and subdivisions still in their infancies several decades ago, there was still a bit of a gambling aspect to home ownership in the desert.
Flash forward to today, and those who rolled the dice on our bustling town hit paydirt, while those who were late to the speculative party (2005-2006) were the unfortunate ones who wound up with snake eyes.
The subsequent erosion of values has hurt many Valley homeowners, but it has also spawned an opportunity that many previously thought had been lost forever. Affordable housing has returned to Scottsdale.
- In all of 2006, there were 39 total sales of single-family homes listed at or below $250,000 in Scottsdale.
- In 2007, that number rose slightly to 48.
- 2008 saw that figure rise dramatically to 247.
*As of today (1/25/09), there are currently 159 Active Listings for single-family homes under $250,000!
Okay, McFly, you've climbed behind the wheel of your DeLorean, coaxed the odometer to precisely 88 miles per hour, and now find yourself back in 2003-2004. Of course, it is a parallel universe in which pricing reflects the period immediately before the boom while interest rates are lower, competition for properties is diminished due to tightened financing guidelines and the available home inventory from which to choose is infinitely greater. Our little town is all grown up now, so who knows when the opportunity for the scaled back pricing in a destination city that is presented today will ever return?
Time to fix some of those investment laments or find that entry-level Scottsdale home that is back within reach.
*Facts and Figures Gleened from ARMLS*
For a Complete Guide to Affordable Housing in Scottsdale AZ
Paul Slaybaugh, Realty Executives
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Weichert Realtors - Marlboro / Manalapan
732-598-6823 cell 732-536-4400 x116 (office)