Over the last year, short sales here in the Phoenix area have been picking up momentum, and in November and December of 2011, they broke two new records!
…not Guinness World Records…but records I believe you should know about nonetheless…
November 2011 was the first month – in the history of Phoenix real estate I believe – when more short sales closed escrow than lender owned properties. According to the latest statistics from our Arizona Regional Multiple Listing System (ARMLS), in November of 2011, 2,009 short sales and 1,888 (approximately 6% fewer) lender owned properties successfully closed escrow.
December 2011 marked the month with the highest number of closed short sales, which, according to ARMLS, hit 2,386.
Why is this important?
Short sales are considered distress sales, and because of this, most people associate them with lower average sales prices. However, the average sales price of a short sale today is higher than that of a lender owned property. So, if short sales continue to outnumber lender owned sales, as we expect them to, the average sales price in the Phoenix area should rise with them.
And it’s beginning to happen already.
Just last month, I got to report in my post, “When will the Phoenix real estate market bottom out?”, that the average monthly sales price per square foot hit a low of $78.76 in September of 2011!
Why are we seeing more short sale success in Phoenix?
There are a number of exciting factors at play right now, but we’ve noticed two dramatic shifts.
First, homeowners are continuing to learn more about short sales, and as they do, many are realizing a short sale is their best financial alternative to a foreclosure.
Second, many banks improved their short sale processes in 2011, which is starting to result in faster approvals. Getting your offer on a short sale reviewed by a bank is still taking longer than it does with a lender owned property, but faster is better (in this case). And we’ll take better.
If you have more questions about buying a short sale or how to sell your house as a short sale, contact us!