Foreclosures – Home resale

The Valley as a complete has broken the traditional home resale season on a low note as foreclosures and depressed home values sustained to control the landscape, but parts of the Southeast Valley in July bucked that trend. In Valley wide, foreclosures represented 42 percent of the resale market in July. That compares to 14 percent in July 2007.

Overall in the Southeast Valley, traditional sales eclipsed foreclosure sales, and the median price on traditional resellers topped the median price on foreclosures.

In Mesa the stats shows: 315 foreclosures, $160,000 median price; 485 traditional sales, $179,000 median price.

In Chandler the stats shows: 120 foreclosures, $198,405 median price; 320 traditional sales, $239,750 median price.

In Tempe the stats shows: 15 foreclosures, $213,560 median price; 100 traditional sales, $248,500 median price.

In Gilbert the stats shows: 170 foreclosures, $231,000 median price; 345 traditional sales, $240,000 median price.

In Ahwatukee the stats sows: 15 foreclosures, $238,925 median price; 100 traditional sales, $295,000 median price.

In cities closer to the urban center like Tempe or Chandler, homes tend to be more expensive and therefore less attractive to investors, said Jay Butler, director of Realty Studies at Arizona State University’s Morrison School of Management and Agribusiness at Polytechnic in Mesa.

“The East Valley is not immune but is doing better than other areas,” Butler said. “It’s more stable, and the university provides some stability too.”

“There’s a lot of frustration out there right now,” Butler said.

“Forty-eight percent of our credit losses were from four states: California, Arizona, Nevada, and Florida. These states saw the most dramatic run-up in prices, and are now seeing the most rapid declines,” Mudd told investors during a conference call earlier this month.

Home prices have cratered in certain markets since the peak. Cape Coral was down 50 percent, Las Vegas was down 35 percent, and northern Virginia was down 30 percent. In California, Modesto and Stockton were down 50 percent and Riverside was down 40 percent.

“So, the housing market has returned to earth fast and hard,” Mudd said. “Some signs do offer rays of positive light. Foreclosures actually fell in Michigan. Same-period home sales were up in California. And, as the [government-sponsored entities] provide most of the liquidity to the primary market, that market is functioning and a safe center of credit risk; pricing and product is being restored.”

Fannie Mae said it hopes its new offices in Florida and California will reduce defaults and better manage the property it has taken in foreclosure.

NYSE: FNM is down to its lowest level in 18 years, falling $2.04 to $3.95 in Wednesday trading. The 52-week high was $70.57 on Aug. 22.