Prices of Homes in Bank Owned Property Listing Continue to Decline

by on cities

Residences in bank owned property listing and new dwellings are in the same boat – both segments are experiencing declining prices in most areas of Arizona. Most housing markets in the state reached their lowest point in April 2009 when prices of dwellings achieved an average of $119,000.

Since then, prices have increased modestly but steadily, averaging $130,000. However, July 2010 showed a sudden decline in the prices of homes in most local areas of the state. Tucson foreclosed homes and new dwellings, as well as residences in Phoenix, all recorded drops in values in July of the current year.

The prices of foreclosed homes in Arizona and regular single family dwellings are expected to continue dropping for the rest of 2010. In Phoenix, July prices dropped by over two percent, making it the first month in 2010 that the city's average home prices went below the range of $130,000. It was also the second consecutive month that the area's average home prices declined.

The declining prices of homes in bank owned property listing and among other types of residences are reportedly worrying most analysts. According to local reports, a big number of houses in Phoenix are in escrow, which means that if deals were closed at prices specified in contracts, overall house sales prices in the city will drop to an average similar to the lowest point recorded in April 2009.

Analysts are reportedly worried about such a scenario since it presents a possibility of a double dip or prices going below previous low averages, which could further hinder any form of housing market recovery. In addition, analysts are worried about the increased number of properties in list of foreclosure homes.

This increase points to a pronounced weakness in the housing market, with foreclosed properties being sold at very low prices amid very few buyers. Analysts explained that this scenario creates an undesirable residential real estate market that does not support any potential recovery.

They further added that majority of buyers interested in purchasing new dwellings or houses from a bank owned property listing have already made their purchase in an effort to take advantage of the tax initiative which expired last June.