ARIZONA: HOUSING AND LABOR MARKET TRENDS

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1 ARIZONA: HOUSING AND LABOR MARKET TRENDS June 2012 Community Development Research Federal Reserve Bank of San Francisco

2 National Trends

3 Composition of distressed sales by geography Proportion of Distressed Property Transactions April % Percent of Total Transactions 40% 20% 0% 26% 35% 15% 10% 12% 13% 18% 13% 23% 24% 20% 18% 14% 14% 21% 12% 15% 9% 14% 16% 17% 17% 12% 10% 5% 13% 17% 16% 11% 6% Short Sale Move-In Ready REO Damaged REO Source: Campbell/Inside Mortgage Finance HousingPulse Monthly Survey of Real Estate Market Conditions April 2012

4 Neighborhood stabilization: concerns over investor purchases of distressed properties Who Is Buying Properties? April % 21% 14% 33% 75% Percent of Property Type 50% 25% 61% 22% 43% 36% 34% 52% Investor First-Time Homebuyer Current Homeowner 36% 32% 18% 0% Damaged REO Move-In Ready REO Short Sale Non-Distressed Source: Campbell/Inside Mortgage Finance HousingPulse Monthly Survey of Real Estate Market Conditions April 2012

5 Financing for home purchases 100% Financing for Homebuyers April % 17% 15% Percent of Buyer-Side Transactions 75% 50% 25% 5% 19% 19% 7% 13% 53% 4% 3% 78% All Other Financing VA Fannie/Freddie FHA Cash 31% 0% Current Homeowners First-Time Homebuyers Investors 10% Source: Campbell/Inside Mortgage Finance HousingPulse Monthly Survey of Real Estate Market Conditions April 2012

6 Arizona Trends

7 Arizona s unemployment rate keeping pace with US; down to 8.2 percent Unemployment Rate (%) United States Arizona Recession Source: Bureau of Labor Statistics

8 Arizona house prices down to 2003 levels 240 FHFA (formerly OFHEO) House Price Index (2000=100, quarterly) Arizona FHFA House Price Index 2000= United States Source: Federal Housing Finance Agency (formerly OFHEO)

9 House prices continued downward trend in many metropolitan areas; little change in Phoenix-Mesa 230 FHFA (formerly OFHEO) House Price Index (2000 = 100) 210 FHFA House Price Index 2000= Flagstaff Yuma Tucson Phoenix-Mesa Source: Federal Housing Finance Agency (formerly OFHEO)

10 Number of delinquent mortgages and properties in foreclosure process continues to fall 200, ,000 Number of Mortgages 120,000 80,000 40, Loans in Foreclosure All Mortgages Past Due Source: Mortgage Bankers Association, National Delinquency Survey

11 Consumer debt delinquency down from 2010 peak 16% Consumer Debt Delinquency Rate 12% Arizona 8% U.S. 4% 0% Note: Delinquency status of 90+ days past due or worse. Excludes first mortgage. Source: FRBNY Consumer Credit Panel

12 Asking rent has increased as vacancy rate falls in Phoenix $800 Asking Rent and Vacancy Rate in Phoenix Quarterly Asking Rent Vacancy Rate 15% $770 10% Asking Rent $740 5% Vacancy Rate $ Source: Reis, Inc. Asking rent is calculated by first determining the average rent for each unit size, and then calculating a weighted average based on the number of units in each size category. 0%

13 Tucson rents up; vacancies down $700 Asking Rent and Vacancy Rate in Tucson Quarterly Asking Rent Vacancy Rate 12% $670 Asking Rent $640 6% Vacancy Rate $ % Source: Reis, Inc. Asking rent is calculated by first determining the average rent for each unit size, and then calculating a weighted average based on the number of units in each size category.

14 Arizona Data Maps

15 Arizona Data Maps Areas Affected by Concentrated Foreclosures April 2012 Source: Lender Processing Services Inc. Applied Analytics & FRBSF Calculations

16 Arizona Data Maps Areas At Risk Of Additional Foreclosures April 2012 Source: Lender Processing Services Inc. Applied Analytics & FRBSF Calculations

17 Phoenix Data Maps Areas Affected by Concentrated Foreclosures April 2012 Source: Lender Processing Services Inc. Applied Analytics & FRBSF Calculations

18 Phoenix Data Maps Areas at Risk of Additional Foreclosures April 2012 Source: Lender Processing Services Inc. Applied Analytics & FRBSF Calculations

19 Oregon Tucson Area Data Data Maps Maps Areas Affected by Concentrated Foreclosures April 2012 Source: Lender Processing Services Inc. Applied Analytics & FRBSF Calculations

20 Tucson Area Data Maps Areas at Risk of Additional Foreclosures April 2012 Source: Lender Processing Services Inc. Applied Analytics & FRBSF Calculations

21 Conclusions

22 For More Information: FRBSF Community Development Website Links to other resources and research on foreclosure trends and mitigation strategies All publications, presentations available on our website Conference materials also posted shortly after events