Last week we quoted our local real estate number crunching guru, Michael Orr,(ASU/Cromford Report) who stated that, “Appreciation of around 5% (Phoenix Metro area) seems to be the order of the day. This may not appear to be a big number but in a deflationary climate a 5% climb should be interpreted as rather impressive…indications are that sales prices will move moderately higher over the next 4 months. We expect rents to move higher more quickly.”
Then yesterday, the Arizona Republic wrote a short story about Housing prices having slipped during the summer. Their source was the Arizona Regional Multiple Listing Service (ARMLS). This article showed that the median price in Metro Phoenix was $214,900 in June, slipped to $212,000 in July and fell again to $208,000 in August. Finally, the article stated that the median price this August was 5.7% higher than the same month last year. This number does in fact agree with Orr’s 5% annual appreciation numbers.
As we’ve mentioned numerous times in the past, all real estate is local. The same is true for price appreciation. What happens statistically in one community will not usually do the same in the next community or town or county. Seeing the big picture of 5.7% is certainly helpful in terms of trends, but we need to be careful about how broad of a brush stroke we make for any given community.
This week we’ve included two charts for your review to see just what we mean about “all price appreciation is local.”
The first chart shows zip codes in the Northeast Valley. As you can see they range in appreciation rates of +12.7% to -2.8% measured from this date last year.
|
Rank
|
ZIP Code
|
% Change in 1 Year
|
Median
|
| 1 | 85263 | +12.7% | $450,000 |
| 2 | 85253 | +5.9% | $1,425,000 |
| 3 | 85257 | +5.2% | $255,000 |
| 4 | 85268 | +5.1% | $415,000 |
| 5 | 85258 | +5.0% | $525,000 |
| 6 | 85251 | +4.4% | $321,500 |
| 7 | 85255 | +4.0% | $810,000 |
| 8 | 85254 | +3.4% | $529,900 |
| 9 | 85250 | +2.5% | $346,500 |
| 10 | 85266 | +1.2% | $893,000 |
| 11 | 85377 | +0.8% | $750,000 |
| 12 | 85259 | -0.3% | $595,000 |
| 13 | 85331 | -0.6% | $400,000 |
| 14 | 85262 | -2.4% | $760,000 |
| 15 | 85260 | -2.8% | $427,500 |
The second chart then shows 43 Phoenix zip code neighborhoods. These neighborhoods had annual price adjustments from +100% (Sky Harbor Airport area) down to -5% in the Ahwatukee neighborhood of 85045.
|
Rank
|
ZIP Code
|
% Change in 1 Year
|
Median
|
| 1 | 85034 | +100.0% | $90,000 |
| 2 | 85009 | +31.7% | $84,950 |
| 3 | 85006 | +29.3% | $179.950 |
| 4 | 85021 | +22.0% | $275,000 |
| 5 | 85016 | +21.3% | $295,705 |
| 6 | 85018 | +20.6% | $524,800 |
| 7 | 85019 | +20.2% | $124,450 |
| 8 | 85020 | +20.0% | $108,000 |
| 9 | 85035 | +19.8% | $115,000 |
| 10 | 85004 | +18.1% | $319,000 |
| 11 | 85051 | +16.7% | $147,000 |
| 12 | 85031 | +15.8% | $110,000 |
| 13 | 85008 | +15.4% | $165,000 |
| 14 | 85007 | +14.6% | $214,900 |
| 15 | 85033 | +12.9% | $118,556 |
| 16 | 85015 | +12.0% | $168,000 |
| 17 | 85043 | +10.6% | $146,000 |
| 18 | 85012 | +10.3% | $505,000 |
| 19 | 85014 | +10.3% | $255,000 |
| 20 | 85042 | +10.3% | $182,000 |
| 21 | 85037 | +10.0% | $140,000 |
| 22 | 85087 | +9.9% | $310,000 |
| 23 | 85040 | +9.1% | $120,000 |
| 24 | 85027 | +8.9% | $172,000 |
| 25 | 85003 | +8.8% | $369,500 |
| 26 | 85029 | +8.4% | $155,000 |
| 27 | 85022 | +7.5% | $245,000 |
| 28 | 85032 | +7.3% | $220,000 |
| 29 | 85013 | +7.0% | $262,250 |
| 30 | 85023 | +7.0% | $207,250 |
| 31 | 85053 | +6.5% | $165,000 |
| 32 | 85024 | +6.4% | $250,000 |
| 33 | 85041 | +6.3% | $153,000 |
| 34 | 85086 | +6.0% | $293,000 |
| 35 | 85054 | +5.9% | $458,000 |
| 36 | 85044 | +5.0% | $255,000 |
| 37 | 85028 | +4.0% | $315,000 |
| 38 | 85083 | +3.4% | $302,000 |
| 39 | 85048 | +0.8% | $312,000 |
| 40 | 85050 | -1.0% | $292,000 |
| 41 | 85085 | -2.6% | $314,990 |
| 42 | 85020 | -5.0% | $270,000 |
| 43 | 85045 | -5.0% | $325,000 |
As you can see from the two charts, there are huge disparities in annual price movement. Out of about 60 communities, only a small handful of communities actually showed 5%+- appreciation. So the next time you see an article about whether or not values are rising or falling (even our articles) consider that it may be a trend for the broader market, but take it with a grain of salt, because locally, that may be all it’s worth.
