Phoenix Housing MarketPhoenix Housing Market
4/16/2009Updated 4/16/2009
1
2
PHOENIXPHOENIX
► STRENGTHS• Population growth
I G th
► CONCERNS•Home Inventories
• Income Growth
• Highly Educated Population
•Foreclosures
•Credit Conditions
• Low Costs of Doing Business
• Affordable Housingg
• No hurricanes, earthquakes, tornadoes, “Santa Ana Fires” or snow
3
2009Forecast
4
Arizona’s Population Growth
6.70
6.57.0
Arizona s Population Growth
5.105.05.56.06.5
2 70
3.703.54.04.55.0
illio
ns
1.301.80
2.70
2.02.53.0M
i
0.75
0.51.01.5
1950 1960 1970 1980 1990 2000 2010
5
1950 1960 1970 1980 1990 2000 2010Source: U.S. Census Bureau
Phoenix’s Population Growth
3 98742174,500
3072
3,987
3,5004,000
2130
2 0002,5003,000
ousa
nds
664971
1509
1,0001,5002,000
Tho
332664
0500
,
1950 1960 1970 1980 1990 2000 2008 2010
6
1950 1960 1970 1980 1990 2000 2008 2010Source: Greater Phoenix Economic Council
Ph i M t E l tPhoenix Metro Employment
19002000
140015001600170018001900
10001100120013001400
Employment has increased over 100 % in Greater Phoenix over the past 20 years overall. Non-farm employment in Greater Phoenix has grown from 983,400 in 1990 to nearly 1.89 million in 2008. Regional employment decreased (1.4) percent between 2007 and
2008 marking the first significant decrease in the last 15 years
7Source: Eller College of Management, The University of Arizona
2008 marking the first significant decrease in the last 15 years.
Comparing MarketsComparing Markets
Percentage of new and existing homes that were sold during the 4th quarter of 2008 that were affordable to families earning the area’s median income.
Seattle 40 6%Seattle 40.6%
Portland 48.9%
Reno64.8%
San Francisco 20.6%
Las Vegas 71.1%
Salt Lake 58.0% Denver 70.3%
Albuquerque
Chicago 56.8%
Los Angeles 26.9%San Diego 44.6%
Phoenix 74.1%Tucson 64.1%
68.7%
San Antonio 62.3%
Dallas 67.5%
Houston 66.2%
8Source: National Association of Home Builders
Arizona In Migration Patterns for theArizona In-Migration Patterns for the Top 5 States Per Year
Colorado
Washing…
Texas
Illinois
0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 110,000 120,000
California
YTD M 09 2008 2007 2006 2005 2004 2003 2002 2001 2000YTD-Mar 09 2008 2007 2006 2005 2004 2003 2002 2001 2000
9Source: Arizona Department of Transportation, Motor Vehicle Division. Dec 2007
Income Growth for Greater PhoenixIncome Growth Percentages for Greater PhoenixIncome Growth Percentages for Greater Phoenix
-1.1%1Q 2009
Year
5.6%
8.7%
1.7%
2006
2007
2008
5 3%
6.6%9.0%
2003
2004
2005
4 0%
5.7%
4.3%
5.3%
1990 2000
2001
2002
2003
6.9%
4.0%
-2% 0% 2% 4% 6% 8% 10%
1980-1990
1990-2000
10Source: Eller Collage of Management, The University of Arizona, 2001 - 2008.
Historical Data: U.S. Census Bureau, 1980, 1990, 2000.
8
Long-Term Interest Rates
5
6
7
3
4
5
0
1
2
Jan-0
6Fe
b-06
Mar-06
Apr-0
6May
-06Ju
n-06
Jul-0
6Au
g-06
Sep-0
6Oc
t-06
Nov-0
6De
c-06
Jan-0
7Fe
b-07
Mar-07
Apr-0
7May
-07Ju
n-07
Jul-0
7Au
g-07
Sep-0
7Oc
t-07
Nov-0
7De
c-07
Jan-0
8Fe
b-08
Mar-08
Apr-0
8May
-08Ju
n-08
Jul-0
8Au
g-08
Sep-0
8Oc
t-08
Nov-0
8De
c-08
Jan-0
9Fe
b-09
Mar-09
Federal Funds (Effective) 30 Year Fixed
11Source: Freddie Mac, Federal Reserve
Median Sales Price of Existing Single Family Homesg g y2008 4th Quarter
Los Angeles
San Francisco
Ri id / S B di
Seattle
BostonNew York
San Diego
Los Angeles
Greater Phoenix
Chicago
Portland
Las Vegas
Riverside/ San Bernardino
Tampa
U.S. Average
MinneapolisSalt Lake City
Denver
$-
$100
,000
$200
,000
$300
,000
$400
,000
$500
,000
$600
,000
Houston
Albuquerque
12 $ $ $ $ $ $
Source: National Association of Realtors, 2007.
Resale Home Median Price Per Month
300000
200000
250000
20022003
150000
20032004200520062007
50000
100000200720082009
0Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec
13
*This representation is based in whole or in part on the data supplied by ARMLS. ARMLS does not guarantee nor is in any way responsible for its accuracy.Data maintained by ARMLS may not reflect all real estate activity in the market.
Source: ARMLS
DETACHED NEW HOME MEDIAN PRICE: $218 156DETACHED NEW HOME MEDIAN PRICE: $218,156 Maricopa County
March 2009 StatisticsPhoenix $218,156
275000
300000
325000
225000
250000
275000
175000
200000
125000
150000
1Q03
3Q03
1Q04
3Q04
1Q05
3Q05
1Q06
3Q06
1Q07
3Q07
1Q08
3Q08
1Q09
14Source: The Information Market
Quarterly
All A ti H Li tiAll Active Home Listings
60000
40000
50000
20000
30000
10000
20000
0
Jan-
02Ju
n-02
Jul-0
2Au
g-02
Oct-0
2Ja
n-03
Apr-0
3Ju
l-03
Oct-0
3No
v-03
Jan-
04Ma
r-04
May-0
4Ju
l-04
Oct-0
4De
c-04
Jan-
05Ma
r-05
May-0
5Ju
l-05
Oct-0
5De
c-05
Jan-
06Ma
r-06
May-0
6Ju
l-06
Sept
-06Oc
t-06
Nov-0
6De
c-06
Jan-
07Fe
b-07
Mar-0
7Ap
r-07
May-0
7Ju
n...
July-
07Au
g-07
Sep-
07Oc
t-07
Nov-0
7De
c-07
Jan-
08Fe
b-08
Mar-0
8Ap
r-08
May-0
8Ju
n-08
Jul-0
8Au
g-08
Sep-
08Oc
t-08
Nov-0
8De
c-08
Jan-
09Fe
b-09
Mar-0
9
15
Includes all single-family, townhomes, and manufactured homes
Source: ARMLS
------------------ Normal Market Conditions
Maricopa County Home Closings
18 000
Maricopa County Home Closings
12,00014,00016,00018,000
6,0008,000
10,000,000
02,0004,000
05 05 05 05 05 05 05 05 05 05 05 05 06 06 06 06 06 06 06 06 06 06 06 06 07 07 07 07 07 07 07 07 07 07 07 07 08 08 08 08 08 08 08 08 8 08 08 08 09 09 9
Jan 05
Feb 05
Mar 05
Apr 05
May 05
Jun 05
Jul 0
5Aug 0
5Sep
t 05
Oct 05
Nov 05
Dec 05
Jan 06
Feb 06
Mar 06
Apr 06
May 06
Jun 06
Jul 0
6Aug 0
6Sep
t 06
Oct 06
Nov 06
Dec 06
Jan 07
Feb 07
Mar 07
Apr 07
May 07
June 0
7Ju
ly 07
Aug 07
Sep 07
Oct 07
Nov 07
Dec 07
Jan 08
Feb 08
Mar 08
Apr-08
May-08
Jun-08Ju
l-08
Aug-08
Sep-08
Oct-08
Nov-08
Dec-08
Jan-09
Feb-09
Mar-09
New Home ClosingsHome Re-Sales
16
Source: The Information Market (Includes: Single Family Detached, Townhomes,& Condos)
Historical Foreclosure Trends-Trust Deed SalesHistorical Foreclosure Trends-Trust Deed Sales
800090001000011000120001300014000
2000300040005000600070008000
01000
17Source: The Information Market
Metro Phoenix Monthly Foreclosuresy
10 000
12,000
8,000
10,000
4 000
6,000
2,000
4,000
0Jan0 6
M ar0 6
M ay0 6
Jul0 6
Sep0 6
N ov0 6
Jan0 7
M ar0 7
M ay0 7
July0 7
Sep0 7
N ov0 7
Jan0 8
M ar0 8
May-0 8
Jul-0 8
Sep-0 8
Nov-0 8
Jan-0 9
Mar-0 9
18Source: The Information Market
Notice of trustee sale, precursor to foreclosure Trust Deed Sales
Median Listing Price vs. Median Sales Price
$350 000
$300,000
$350,000
$200,000
$250,000
$150,000
$200,000
$100,000
Jan
02
Apr
02
Jul 0
2
Oct
02
Jan
03
Apr
03
Jul 0
3
Oct
03
Jan
04
Apr
04
Jul 0
4
Oct
04
Jan
05
Apr
05
Jul 0
5
Oct
05
Jan
06
Apr
06
Jul 0
6
Oct
06
Jan
07
Apr
07
Jul 0
7
Oct
07
Jan
08
Apr-
08
Jul-0
8
Oct
-08
Jan-
09
Li ti P i S l P i
19
Listing Price Sales Price
Source: ARMLS
Metro Phoenix New Housing PermitsMetro Phoenix New Housing Permits
6000
7000
4000
5000
6000
2000
3000
4000
0
1000
2000
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec
2005 2006 2007 2008 2009
20Source: The Arizona Republic,
Phoenix Business Journal
Phoenix Market:All Detached Product – Historical Finished Lot Inventory
70 000
80,000 72
66
50 000
60,000
70,00060
54
48
M
30 000
40,000
50,00042
36
30
MONTHS
10,000
20,000
30,000 24
18
12
6
0
10,000
Q04
Q05
Q05
Q05
Q05
Q06
Q06
Q06
Q06
Q07
Q07
Q07
Q07
Q08
Q08
Q08
Q08
Finished Lot Inv
Months of
6
4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
Months of Supply
21Source: Metrostudy
Phoenix Market: 4th Qtr 2008Phoenix Market: 4 Qtr 2008Months Supply of Vacant Lots by Lot Width
264
192216240
96120144168
24487296
024
Att < 45 45 50 55 60 65 70/75 80/85 90+St d d L t WidthStandard Lot Width
22Source: Metrostudy
Phoenix Market: 4th Qtr 2008Vacant Lot Months of Supply by Submarket (1st of 2)
Near North PhxNorth Phoenix
Central PheonixPeoria
FlorenceTempe
North SurpriseSouth Surprise
East MesaHunt Hwy …
Central Pheonix
Near SW PhxWest ChandlerEast Chandler
North AvondaleNorth Surprise
West MesaSouth Scottsdale
South BuckeyeNear SW Phx
0 24 48 72 96 120 144 168 192 216 240 264 288 31223Source: Metrostudy
Phoenix Market: 4th QTR 2008Vacant Lot Months of Supply by Submarket (2nd of 2)
MaricopaNear West Phx
GlendaleGilbert
TollesonSouth Mountain
Maricopa
North ScottsdaleSun City AreaQueen Creek
GoodyearGlendale
CoolidgeNorth BuckeyeAJ-Gold Camp
Casa GrandeNorth Scottsdale
Fountain HillsCave Creek
Litchfield ParkCoolidge
0 24 48 72 96 120 144 168 192 216 240 264 288 31224Source: Metrostudy
25Source: Maricopa Association of Governments
26Source: Maricopa Association of Governments
27