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READING
BETWEEN THE FOR SALE SIGNS
It
looks like the gloom and doom people are at it again, building
another wall of worry for us to climb. Yes, it’s true that
across the country the housing industry has lost some of its vigor.
It is also true that home sales nationally have slowed from a
5.6 percent growth rate at the beginning of the year to 2.5 percent
this last quarter. What does all of this mean? It means that if
you are planning to move to South Florida, Las Vegas, or Phoenix,
there are fabulous bargains awaiting you.
But
if your dream is to live in the Sedona-Verde Valley area, I suggest
you not pay attention to the laments of all the pessimistic pundits.
Why, you ask? Because this is a unique market. It is America’s
most beautiful spot to live in, and there is no other place like
it anywhere.
Please
take a look at my Investments page at LeeCongdon.com. Notice that
during the last recession the stock market went down precipitously,
but Sedona homes, condos, and land kept going up . . for five
straight years. By comparison, look at today’s economy.
The number of new jobs created in June was 134,000. In July, 121,000.
In August, 128,000. During the month of August the national unemployment
rate dropped to 4.7 percent. Wage increases over the last twelve
months have totaled 3.9 percent. Tell me, do these statistics
indicate a recession to you?
Here
is what has been happening to real estate in the Verde Valley
from January 1, 2006 to July 31, 2006, compared to the same seven-month
period last year.
Sedona |
|
|
| Residences |
Average
Sales Price: $737,043
Median Sales Price: $594,900 |
Percentage
change: + 20.6 %
Percentage change: + 14.0 % |
| Vacant
Land |
Average
Sales Price: $589,363
Median Sales Price: $515,000 |
Percentage
change: + 33.6%
Percentage change: + 43.0% |
Cottonwood,
Clarkdale, Cornville |
|
| Residences |
Average
Sales Price: $294,718
Median Sales Price: $255,000 |
Percentage
Change: + 11.1%
Percentage Change: + 06.7% |
| Vacant
Land |
Average
Sales Price: $189,239
Median Sales Price: $163,500 |
Percentage
Change: + 11.6%
Percentage Change: + 25.7% |
Camp
Verde |
|
| Residences |
Average
Sales Price: $345,205
Median Sales Price: $243,000 |
Percentage
Change: + 48.3%
Percentage Change: + 23.1% |
| Vacant
Land |
Average
Sales Price: $93,538
Median Sales Price: $85,000 |
Percentage
Change: - 03.8%
Percentage Change: + 04.5% |
Lake
Montezuma, Rimrock |
|
| Residences |
Average
Sales Price: $245,267
Median Sales Price: $230,000 |
Percentage
Change: + 24.1%
Percentage Change: + 32.1% |
| Vacant
Land |
Average
Sales Price: $95,518
Median Sales Price: $50,000
|
Percentage
Change: + 43.1%
Percentage Change: + 03.1% |
To
say that the real estate market in Sedona and the Verde Valley
is experiencing a slump would seem to be somewhat of an overstatement.
The numbers clearly demonstrate a pattern of continued price appreciation.
More than likely what we are experiencing is a temporary lull
caused by hesitant buyers. I would hope those hesitant buyers
are not counting on a sharp decline in property prices. Sure,
there is always the individual seller who might decide to drastically
reduce his price and facilitate a quick sale, but that would be
an exception, not the rule. Serious buyers should not be expecting
anything more than a modest price decline during the next six
to nine months. After that, prices will more than likely resume
their upward trajectory.
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