Wednesday, January 12, 2005

Chandler home prices leap

Existing-property median up $24,000 in '04

Stephanie Paterik and David van den Berg
The Arizona Republic
Jan. 12, 2005 12:00 AM The number of existing homes sold in Chandler soared in 2004, with the median sales price $24,000 higher than a year ago, according to figures released Tuesday by the Arizona Real Estate Center at Arizona State University's East campus.

"Believe me, when you have four buyers per home it's going to drive the price up," said Paul McPherson, a Realtor with Re/max Elite in Chandler. "The prices spiked drastically in the last six months."

In 2004, the median price for an existing Chandler home was $186,000 compared with $162,000 in 2003. In 2004, 7,280 existing homes were sold, compared with 5,610 in 2003.

The median price is the point at which half the homes sold for more, half sold for less.

Chandler wasn't alone in seeing its resale housing market grow. Experts say the home-buying frenzy is being driven by investors speculating on the continued run-up of Valley housing prices and move-up buyers cashing out of one home and moving up to buy a bigger or better one.

However, the flip side is that first-time buyers are having a harder time finding Valley houses they can afford because of higher prices and a dwindling inventory.

Valley-wide, the median price of a used home climbed 12.8 percent last year to reach an annual record of $174,815. At the same time, the number of homes for sale has dropped by half during the past year.

Now houses in Valley hotspots, such as Chandler, sell within days, or even hours in some neighborhoods.

Mesa, Tempe, Gilbert and Ahwatukee Foothills also saw the number of existing houses sold increase between 2003 and 2004, along with median prices.

"There's no real surprises," said Jay Butler, director of ASU's real estate center. "Everybody sort of fits the general mode of events for the year 2004."

McPherson said it was a good year for Realtors like himself but listings are dwindling.

"I don't think there will be as many sales this year," he said. "We're very concerned about this next year. While there's a lot of buyers, there are not a lot of homes to sell."

To find homes, Realtors consult the Multiple Listing Service. McPherson said that database shows 6,406 homes sold in Chandler last year but with a higher median price, $216,645, than ASU's figures.

"I fully expect them (prices) to go up for a couple years because of the demand," McPherson said. "We have not hit the bubble."

Ahwatukee Foothills had the southeast Valley's highest median sales price for existing homes at $229,900.

The community is experiencing historically low inventory, said Pete Meier, associate broker and office representative for Realty Executives in Ahwatukee Foothills. Usually, about 600 houses are for sale at any given time. Today, there are about 70.

"I haven't seen such a feeding frenzy," he said.