Sedona and Verde Valley Real Estate Second Quarter 2019
What is the purpose in keeping statistics of any kind? With luck, we can hope to learn from them and make decisions about our lives that will have a positive outcome on it. In its pure form we are all statisticians, evaluating what has come before and planning our next minutes, hours and days.
In looking at Sedona and Verde Valley real estate statistics, I think the first thing that we have to consider is that in the whole scheme of things, the Verde Valley is a small market. For that reason, over the years I have prepared these statistics on a quarterly basis, doing them monthly, there is just not enough information to see any trends.
So, what am I getting at here? In looking at statistics for the last 12 months and especially the first 6 months of 2019, I have to ask myself, are we at an inflection point in our market?
For the first time in 8 years the median sales price of a single family home in the Sedona area in the first 6 months of the year went DOWN! The 4% drop in median sales price came at the same time as a 14% drop in the number of sales in 2019 when compared to the first 6 months of 2018. In looking at the year over year sales there is a ½ of one percent drop in the median sales price, again the first in 8 years and a 3.5% drop in the number of sales.
Is the sky falling, I don’t know? There is such a mixed bag of findings revealed in this quarter’s statistics, you decide:
- Single family sales in the Verde Valley in the last 12 months were down 10% from the previous 12 months, yet the overall median sales price in the Verde Valley was up 11%.
- Residential inventory in the Verde valley is still very tight, but up 10% over the first of the year.
- Vacant land sales in the Sedona area were flat, yet we had a 15.5% increase in the median price.
- Sales over $1,000,000 in the last 12 months were the strongest in 12 years.
- The median sales price in the Camp Verde area was up 16% in the last 12 months on sales that were off 18%.
- The median sales price in the Rimrock/Lake Montezuma area was up 15% yet sales were off 5%.
- The median sales price in the Cottonwood area was up 13.5% to its all-time record, yet sales were off 7.3%.
- Cumulative days on market is at the lowest time in 12 years.
Outside forces also have a direct impact on our market. Interest rates were predicted to go up in 2019 but so far this year they have gone down over ½ of one percent and are below 4% for borrowers with good credit. The economy remains strong with steady job creation. And California and the upper Midwest are still sending buyers are way. All a positive impact.
So why are sales down in the Verde Valley. One thing that might be having an impact is that some buyers are being priced out of our markets and are going elsewhere. The median income family cannot buy the median home in any market in the Verde Valley. The affordability of the other markets in the Verde Valley compared to Sedona make them attractive and have appropriated buyers that cannot afford Sedona yet want to be in the Verde Valley. Just one statisticians thought, what is yours?
Just the Facts:
Sedona area: The median price of a single-family home was virtually unchanged dropping one half of one percent in the last 12-month period to a median sales price of $554,500. The number of transactions came in at 474 sales for the last 12 months compared to 492 sales in the previous 12-month period, down 3.5%. What is more significant is the 14% drop-in single-family sales in the first six months of the 2019 to 232 sales compared to 268 in the first six months of 2018. To go along with the 14% drop in sales there was a 4% drop in the median sales price in the first 6 months of 2019 to $555,000. Inventory remains tight, if we see inventory start to rise, we will be seeing a real change in the market.
Vacant land transactions year over year remained steady coming in at 157 sales for the last 12 months compared to 155 sales in the previous 12-month period. The median price took a significant jump of 15.5% to $155,000 for the last 12-month period. With that said the median sales price for vacant land has been bumping along between $155,000 to $130,000 for the last 6 years
The Sedona area luxury market, prices over $1,000,000, came in at a vigorous 55 sales in the last 12-month period only topped by 57 sales in 2005-2006. This was a 22% increase over the previous 12-month period. Further evidence of the strength of this segment of the market is that there have been 32 sales over $1,000,000 in the first six month of the year.
The median sales price for Condos and Townhomes in the Sedona area for the last 12 months came in at $306,625 a 6.5%% increase over $287,750 for 2018. The number of transactions for the last 12-month period came in at 142 a 20% increase over the number of sales in 2018.
Cumulative days on the market came in at 83 for the last 12-month period down from 95 days from the previous 12-month period. Even with the number of sales down, time on market continues to drop, a reflection of the amount of inventory still being in short supply. Well priced homes are still selling quickly!
The median sales price for single family homes in the Camp Verde area for the last 12 months rose sharply to $266,500 up 16% over the previous 12-month period’s $227,500. This sharp increase in price came in despite the 18% drop in the number of transactions in the last 12 months to 98 sales from 119. The median sales price for the first 6 months of 2019 came in at $265,000 up 19% from the first 6 months of 2018. This increase in sales price came in direct contrast to the sharp decrease in the number of sales, which were off 25% in the first 6 months of 2019 compared to 2018.
Lake Montezuma and Rimrock:
The median sales price for single family homes in the Rimrock and Lake Montezuma area for the last 12-month period came in at $230,000 up 15% from a year ago. That is an all-time high for the median sales price in this area. The number of sales was down 7% to 67 sales compared to the previous 12-month periods 72 sales. The median sales price for the first six months of 2019 came in at $217,000 up 15% from the first six months of 2018 but down 6.5% compared to the previous 12-month period indicating a softening of pricing to go along with weakening sales.
Cottonwood and Cornville:
The median sales price for single family homes in the Cottonwood and Cornville area for the last 12 months came in at $286,000 up 13.5% from a year ago, the highest median sales price ever recorded. This record median sales price again is despite a 7% drop in the number of sales in the last 12 months to 529 sales compared to the previous 12 months 571. Even more confusing is that the median sales price for the first 6 months of 2019 came in at $292,500 with a drop in the number of sales to 275 off 3% when compared to 2018.
The Bottom Line: Sales are down in the Verde Valley, yet prices are at all-time highs. Cumulative days on market is at its lowest point in 12 years. Inventory remains tight, interest rates are great, our feeder markets are still strong. I do not see much change for the rest of 2019, but keep an eye on inventory, an increase there will have an impact if we do not see sales strengthen.