Closings of new homes in the Tucson, AZ market declined year-over-year in July, and the percentage drop was steeper than June 2016, suggesting the market may be worsening. Closings declined 40.1% from a year earlier to 94. This followed a move from 151 in June 2015 to 157 in June 2016.
A total of 1,681 new homes were sold during the 12 months that ended in July, down from 1,744 for the year that ended in June.
New home closings represented 4.9% of overall housing closings. This is a fall 8.8% of closings a year earlier. Closings of new and existing homes increased year-over-year in July after also rising in June year-over-year.
Pricing and Mortgage Trends
In July, the average price of newly sold homes declined 18.4% year-over-year to $248,193 per unit. This decline follows a move from $261,589 per unit to $259,566 from June 2015 to June 2016.
Average mortgage size on new homes gained year-over-year in contrast to new home prices. The average mortgage size saw a 2.8% gain year-over-year to $228,457 in July. Average mortgage size sank 3.3% in June 2016 from a year earlier.
Other Market Trends
Closings of attached units, as a percentage of new home closings, have risen from last year while closings of single-family homes have fallen. The share of new home closings belonging to attached units gained from 2.5% of closings in July 2015 to 5.3% of closings in July 2016. Conversely, the share belonging to single-family homes dropped to 94.7% of closings from 97.5% of closings.
For all new homes sold, the average unit size grew 6.1% year-over-year to 2,348 square feet in July 2016. The average size of newly sold homes moved from 2,183 square feet in June 2015 to 2,252 square feet in June 2016.
Foreclosures and real estate owned (REO) closings continued to fall from a year earlier in July, but did not look to be a burden on the market. Together, foreclosures plus REO closings made up 18.9% of existing home closings, down from 22.9% a year earlier. The percentage of existing home closings involving foreclosures fell to 5.2% in July from 11.5% a year earlier while REO closings as a percentage of existing home closings increased to 13.7% from 11.5%.