Here’s yet another study I found a little earlier, documenting my previous claims of a historical average rate of appreciation to be 4-7%. ASU’s PolyTechnic published this article, and although it’s not updated for 2007, still has some great information in here. What surprised me a little is the appreciation rates around the ‘Corporate’ areas in town- Central Phoenix, Camelback Areas, South Scottsdale, all did very well. Notice how much lower the condo/townhome market is compared to single family housing. Just too much supply, not enough demand for those things (but do very well as rentals). Check it out, let me know your thoughts.
Appreciation at a Record Level for 2006.
Arizona State University’s W.P. Carey School of Business has published a new way of measuring appreciation rates here in Arizona. It’s about time someone came up with a solid way to tracking this data! Instead of rehashing out the entire study- here’s the gist of it.
They tracked houses that have sold previous, and compared them to what they’re selling for NOW to come up with a measure of appreciation between the 2 dates. Now, because of the seasonality of the Real Estate market, they compared like months to like months to maintain some consistency. It’s the exact same thing I do in my own analysis on the market.
Now, don’t get confused and freak out when you see these charts! This is the Repeat Sales Index, not where the prices are currently! If you look at the charts and not read the article, you’d freak out thinking your home and other investment property has lost 50% or more of their value. THAT IS NOT TRUE. These charts are the RATES OF APPRECIATION, not home prices. So, during the boom, Chandler had a 48% appreciation. Now, it’s slightly declined in value. When you look at the chart for it, it’s pretty dramatic. Just make sure to keep some perspective and remember, this is the RATES OF APPRECIATION. Check it out here. Finally we have a legitimate and current source to track our appreciation rates.
Repeat Sales Index - ASU W.P. Carey School of Business.
If you have any thoughts or comments, I invite you to post below!
