Market Conditions & Trends

Will Rogers:

"Its a good thing we don't get all the government we pay for"

Over the last four decades Arizona has realized substantial investments in land from foreign buyers.  In the 1970's the Canadians were buying heavily; the early 1980's saw the Japanese investing; the Reunification of Hong Kong with mainland China drew Chinese National's who invested in Western Canada and Arizona in the 1990's.

Will Rogers:

"Even though you are on the right track - you will get run over if you just sit there"

Out-migration from California is substantially fueling our future growth with high tax rates and urban stress driving young professionals and the wealthy across the Arizona border. Arizona and the Phoenix Metro area have historically led the nation in Population and Employment Growth, Tourism and Retirement Relocations – We are seeing evidence of this again as the recovery becomes entrenched.

Custom Home Lots
On an annualized basis 2007 was the Peak Year - Closing Prices Averaged 117% of Listing/Asking Prices with the Highest Price Paid at $780,800 Per Acre. The market continued to perform well during the 1st Quarter of 2008 attaining Closing Prices at 150% of List Prices.  However, the Number of Days on Market increased to 412 during the quarter. 2005 registered the strongest "Velocity" with over 54% of all Active Listings realizing Closings and with the shortest Days on Market at 251 days. Speculative interests continued to drive the land/lot market higher while the improved product (finished homes) started it's correction a year earlier.

	Custom Home Lots			Peak Year
	5 yr Avg	2005	2006	2007	2008	2009	2010
List Price/Acre	$607,500	$570,790	$638,312	$665,781	$630,294	$532,315	$439,728
Sold Price/Acre	$612,280	$523,354	$679,443	$780,800	$728,860	$348,950	$304,100
Closed vs Total Listed	35%	54%	31%	26%	12%	17%	18%
% of List Prices	99%	92%	106%	117%	116%	66%	69%
Days on Market	345	251	328	360	406	392	407

CUSTOM HOMES
The Average Custom Home size has remained in a narrow range between 5,200 & 5,500/SF for homes between 3,800/SF & 12,000/SF Built after the year 2000.  Custom home lot sales peaked during the 1st Quarter of 2008 while Custom Home Sales Prices peaked a year earlier during the 1st Quarter 2007. The market performed within a very tight range for 2006 & 2007 with Closing Prices attaining 103% of Ask/List Prices with 31% of Active Listings realizing Closings.  2007 was also the Peak Year for Custom Home Sales which performed well thru Q1-2008 then began a steady decline.  In spite of the worst economic downturn since the 1930's the number of total Listings on the market remained in a narrow range for the five years 2005 thru 2009.