Closings of new homes gained year-over-year in February in the Prescott, AZ market, moving upward off a fall in January 2016. Closings gained 16.7% from a year earlier to 28. This came on the heels of a 13.3% decline year-over-year in January.

A total of 503 new homes were sold during the 12 months that ended in February, up from 499 for the year that ended in January.

As a percentage of overall housing closings, new home closings made up 7.9% of overall housing closings. They made up 7.0% of closings a year earlier. Closings of new and existing homes rose year-over-year in February following a drop in January year-over-year.

Pricing and Mortgage Trends

In February, the average price of newly sold homes sank 8.8% year-over-year to $304,837 per unit. This drop is larger than the 7.0% decline in January from a year earlier.

The average mortgage size on newly sold homes declined year-over-year in contrast to the average price of new homes. In February 2016, average mortgage size on new homes sold was $211,069, down 11.4% from a year earlier. Average mortgage size declined 2.6% in January 2016 from a year earlier.

Other Market Trends

There has been little change in the composition of the market with regard to the types of properties sold. From a year ago, single-family home closings have moved from 95.8% of new home closings to 96.4% of closings while attached units have gone from 4.2% of closings to 3.6% of closings.

There was a 6.5% decline year-over-year in the average unit size of newly sold homes to 1,545 square feet in February 2016. In January, the average size of new homes sold went from 1,979 square feet a year earlier to 1,824 square feet. A decrease in both the average size and price of newly sold homes was also seen in January 2016 when the average size gained 7.8% to 1,824 square feet.

Foreclosures and real estate owned (REO) closings continued to drop from a year earlier in February, but did not appear to be dragging the market. Out of all existing home closings, foreclosures combined with REO closings represented 12.3% of closings, below 15.4% a year earlier. The percentage of existing home closings involving foreclosures went from 5.0% in February 2015 to 4.6% in February 2016 and REO closings as a percentage of existing home closings fell to 7.7% from 10.4% a year earlier.

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