2013 A Strong Year
For The Sedona West Subdivision
The Sedona West Subdivsion turned in a strong performance in 2013 with the median sales price jumping over $100,000 to a median sales price of $365,000. Great news for homeowners in Sedona West and the entire Sedona area which saw the median sales price move up 13% to $395,000 for the year.
There were 15 closed residential sales in 2013 in the Sedona West Subdivision with prices ranging from $242,500 on the low end to $608,000 on the upper end. Two of the 15 sales were new homes built on speculation and sold for $555,000 and $608,000. The cumulative days on market was 141 days, just under 5 months from coming on the market to close of escrow.
As of this writing there are eight active residential listings in the Sedona West Subdivision ranging in price from $232,500 to $477,500. Three of those listings are under contract.
There were three vacant lot sales in 2013 ranging in price from $63,500 to $90,000. Currently there are two active vacant lot listings in the Sedona West Subdivision with prices of $129,000 and $172,000.
For 2014 it will be all about inventory! In 2011 and 12, the big question was when home prices would hit bottom. With the median sales price of a single family home in the Sedona area rising 13% in 2013 and with the inventory of homes available for sale lower than they have been in the last 7 years, especially in sales prices below $500,000, we have to ask when are we going to see inventory rise and what impact this low inventory is going to have on prices for 2014. The supply of residential inventory has fallen 49% in the Sedona area since September of 2008 and resulted in multiple offers and increasing prices.
With the reduction in inventory over the last 6 years we finally saw prices bottom out in 2011 and 2012 and have had a strong recovery in 2013. The median sales price in the Sedona area of a single family home rose 13%.
Other areas of the Verde Valley have seen strong increases in median sales prices since the bottom of the market with prices rising 18% in the Camp Verde area, 28% in the Cottonwood and Cornville area and 35% in the Lake Montezuma and Rimrock area. Good news for homeowners in all areas of the Verde Valley.
While the numbers of transactions has remained steady over the last four years, in addition to the decrease in inventory another driving force in increased prices has been the dramatic decrease in the number of foreclosures impacting the market and this trend is going to continue. The number of homeowners that are behind on the mortgages continues to decline as evidenced by the continued decrease in the Notice of Trustees sales recorded. Since their peak in 2009 the number of Notice of Trustees filings in Yavapai County has decreased 72% to 1167 filings in 2013, below the number in 2007 and approaching numbers for a more normal real estate market. This bodes well for a continued reduction in the number of foreclosed properties impacting the market in 2014
The Bottom Line: Prices will increase in 2014 but not at the pace of 2013, although lower priced segments of the Sedona market will remain strong due to lack of inventory. Interest rates will rise slightly but getting a loan will be a little pricier and dicier due to the new Dodd/Frank rules coming into effect regarding debt to income ratios and “qualified loans”. Job growth will remain steady, adding to the number of buyers coming into the market along with increased household formation. And this will be the year that home builders “really” get back into the market and add stiffer competition to existing home sellers.
So the good news is rising home prices should motivate would-be sellers to put their homes on the market and also stimulate new construction, both of which will expand inventory, boost sales, and give house hunters more to choose from.
Overall it will be a more back to normal year for the real estate market in 2014 and another solid year for home sellers in the Sedona West Subdivision.