The document summarizes the luxury housing market in February 2013. It finds that delinquency rates are down significantly from their peak but still above normal levels. Inventory of bank-owned homes is declining slowly with many properties still not actively listed. Both sales and prices are rising gradually month-over-month while the 30-day outlook is positive, expecting a continued market recovery as credit improves and foreclosures decline.

1. Luxury Housing Market Update
Feb 20, 2013
MIKE ORR
mike@cromfordreport.com
mike.orr@asu.edu
© 2013 www.cromfordreport.com

2. Delinquency Rates Down
80% of the way back to normal

3. 16.3% ranked 5th worst
AZ
13.5%
USA
10.6%
7.3%
© 2013 www.cromfordreport.com ranked 40th
Normal level is 5%

5. Shadow Inventory?
• “We don’t know what the banks are hiding”

6. Lender Owned Homes / Condos
City ZIP Homes Unlisted Active REOs in % Unlisted
REOs REOs Escrow REOs
Phoenix 85018 13,231 12 4 8 0.09%
Paradise Valley 85253 6,563 5 1 4 0.08%
Scottsdale 85255 18,331 12 6 3 0.07%
Scottsdale 85258 6,394 2 0 0 0.03%
Scottsdale 85262 7,022 10 9 2 0.14%
Scottsdale 85266 5,843 3 1 1 0.05%

7. Supply

8. excludes active listings under contract seeking backup offers
3,596
2,894 2,912

10. Sales

15. Prices

20. 30 Day
Outlook

21. Outlook for the Luxury Market
• Continued recovery and prices will gradually rise
• Pending foreclosures will soon fall to normal levels
• Short sales will be much less significant
• Increasing confidence in the market
• Improving credit -> more move up buyers
• Builders will slowly return to luxury market
• Luxury market will improve from the bottom up