Home sales up, prices still declining

The volume of home sales is up in Yuma County but the average sales prices is still declining, following a trend seen nationwide during the second quarter of 2009.

The National Association of Realtors said Thursday that home sales rose 3.6 percent to a seasonally adjusted annual rate of 4.89 million last month, from a downwardly revised pace of 4.72 million in May. Home sales haven’t risen for three straight months since early 2004, during the housing boom.

In Yuma County, a total of 475 single-family homes sold April through June, according to the second-quarter real estate report released Friday by Yuma County Assessor Joe Wehrle. That number is up markedly from 323 homes sold during 2009's first quarter. On the other hand, it's down from 497 homes sold during the fourth quarter of 2008.

In fact, the market here has shown an up-and-down pattern in home sales volume per quarter since a high of 1,077 was reached in the third quarter of 2005, according to the assessor's office.

When it comes to resale homes only, those that are listed by the Yuma Association of Realtors on its multiple listing service, the numbers for the second quarter are encouraging, said Realtor Dennis Krill. January through March there were 240 MLS sales with the number reaching 317 during April through June.

Much of that increased MLS activity was attributed by assessor Jeff Harper to sales in May when 163 homes sold. "May was fantastic."

In comparison, June sales were "fairly normal" at 103, with similar activity in April.

As for new homes, there are mixed reports. But the consensus seems to be that lower and moderately priced subdivisions are doing better than custom homes.

"All our projects are doing well," said Bobbie Cooper, sales manager for The Development Group by Elliott Homes. Those projects include Estrella in Mesa del Sol, Araby Crossing in the city where the first phase of 18 homes has sold and four in the next phase, and even Arroyo del Fortuna in the Foothills, a product primarily for winter visitors that has been selling this summer to year-round residents.

Cooper said the first quarter "was bad but we're definitely seeing an upswing for the second quarter" that is continuing into July.

The increase in sales volume in the second quarter likely is a factor of a still favorable interest rate of around 5.5 percent and the $8,000 tax credit for first-time homebuyers, Krill said.

"So sales are picking up," he said.

Average sales price is another story. From a high of $233,067 in the second quarter of 2007, the average home sales price has been declining, according to Wehrle.

The sales price of the 475 homes sold in Yuma County during the second quarter averaged $167,193, down 7.04 percent from an average of $179,851 in the first quarter of the year, he reported. And the average sales price for the quarter is down 16.9 percent from the same time a year ago.

Krill noted that of the MLS sales, the average price for the second quarter was $159,709, compared to the average of $172,514 in the first quarter.

"So prices are down," he said.

Cooper agreed, adding that sellers also are offering more incentives.

Nationwide, the median sales price was $181,800 in June, down 15 percent from year-ago levels but up slightly from $174,700 in May.

Sales of foreclosures and other distressed properties made up about a third of all transactions nationwide last month, down from nearly half earlier this year.

Declining prices is a trend that's apt to continue for a while with a glut of distressed properties on the market and more expected, Harper said.

"There's still plenty of foreclosures on the market in Yuma County," he said, based on the number of foreclosures he's been appraising.

"My guess is there is still some inventory to go there," as a result of ARMs (adjustable rate mortgages) coming due in the next few months, he said.