Following is an analysis of the foreclosures and trustee sales in all of Maricopa County with tables showing the hardest hit zip codes. Power Ranch Arizona has felt the blow of the foreclosure crisis; however, you will notice that when compared with the rest of the valley, Gilbert has done quite well.
Between January 1, 2006 and December 22, 2010, there have been 253,854 Notices of Trustee Sale (NOTS) recorded in Maricopa County against single family homes. Since there are 1,006,770 single family homes in Maricopa County according to the County Assessor, that's 1 NOTS for every 4 single family homes. Now quite a few homes have received multiple notices so if we count just the UNIQUE parcels that have received at least one NOTS we get a total of 213,081. This means that on average 21.2% of single family homes have received at least one NOTS since the beginning of 2006.
There have been 127,156 Trustee Deeds (TDs) issued in the same period, which represent 50.1% of the NOTS and 59.7% of the unique parcels that received at least one notice. On average 12.6% of the single family homes in Maricopa County have been foreclosed with a recorded Trustee Deed in the nearly five years since the beginning of 2006. That's just over one in eight homes. There are also some 1,300 or so unrecorded Trustee Deeds as of yesterday.
Where has this percentage been highest?
The ZIP codes with the highest percentage of homes foreclosed (i.e. with a recorded Trustee Deed) are:
| Rank | City | ZIP | SF Homes | NOTS | SF Homes with >=1 NOTS | TDs | TD % | NOTS % | TD as % of NOTS |
| 1 | Phoenix | 85043 | 7,568 | 4,483 | 3,705 | 2,514 | 33.2% | 49.0% | 67.9% |
| 2 | Tolleson | 85353 | 8,685 | 4,874 | 4,128 | 2,750 | 31.7% | 47.5% | 66.6% |
| 3 | Phoenix | 85037 | 12,158 | 6,785 | 5,603 | 3,825 | 31.5% | 46.1% | 68.3% |
| 4 | El Mirage | 85335 | 9,227 | 4,972 | 4,127 | 2,856 | 31.0% | 44.7% | 69.2% |
| 5 | Tonopah | 85354 | 535 | 225 | 207 | 159 | 29.7% | 38.7% | 76.8% |
| 6 | Buckeye | 85326 | 13,957 | 6,806 | 5,828 | 4,095 | 29.3% | 41.8% | 70.3% |
| 7 | Avondale | 85323 | 9,417 | 4,806 | 3,762 | 2,615 | 27.8% | 39.9% | 69.5% |
| 8 | Phoenix | 85033 | 11,194 | 5,956 | 4,857 | 3,098 | 27.7% | 43.4% | 63.8% |
| 9 | Surprise | 85379 | 13,345 | 6,288 | 5,322 | 3,519 | 26.4% | 39.9% | 66.1% |
| 10 | Phoenix | 85031 | 5,823 | 3,002 | 2,426 | 1,510 | 25.9% | 41.7% | 62.2% |
| 11 | Phoenix | 85035 | 8,322 | 4,279 | 3,486 | 2,153 | 25.9% | 41.9% | 61.8% |
| 12 | Laveen | 85339 | 10,939 | 5,059 | 4,399 | 2,690 | 24.6% | 40.2% | 61.2% |
| 13 | Glendale | 85303 | 7,599 | 3,489 | 2,834 | 1,822 | 24.0% | 37.3% | 64.3% |
| 14 | Youngtown | 85363 | 1,952 | 789 | 659 | 452 | 23.2% | 33.8% | 68.6% |
| 15 | Surprise | 85388 | 7,961 | 3,263 | 2,830 | 1,825 | 22.9% | 35.5% | 64.5% |
| 16 | Phoenix | 85017 | 5,671 | 2,619 | 2,152 | 1,300 | 22.9% | 35.8% | 60.4% |
| 17 | Glendale | 85307 | 1,868 | 781 | 668 | 428 | 22.9% | 35.8% | 64.1% |
| 18 | Phoenix | 85041 | 14,462 | 6,147 | 5,125 | 3,225 | 22.3% | 35.4% | 62.9% |
| 19 | Phoenix | 85019 | 5,577 | 2,424 | 1,953 | 1,208 | 21.7% | 35.0% | 61.9% |
| 20 | Avondale | 85392 | 10,674 | 3,783 | 3,535 | 2,312 | 21.7% | 33.1% | 65.4% |
We notice that every single one of the top 20 ZIP codes hit hardest by foreclosures is in the West Valley. In fact we have to drop to rank 24 before we find a ZIP code outside the West Valley and that is 85040 in South Phoenix. The first time we hit the Southeast Valley is at rank 28 (Apache Junction 85120) and the first time we hit the Northeast Valley is at rank 64 (Phoenix 85032). We also note that the percentage of NOTS that result in a TD is very high for the top 20, always over 60% suggesting that foreclosure prevention attempts are not very successful in these areas.
If we look at the opposite end of the table:
| Rank | City | ZIP | SF Homes | NOTS | SF Homes with >=1 NOTS | TDs | TD % | NOTS % | TD as % of NOTS |
| 112 | Fort McDowell | 85264 | 79 | 7 | 7 | 4 | 5.1% | 8.9% | 57.1% |
| 113 | Scottsdale | 85250 | 3,353 | 431 | 349 | 169 | 5.0% | 10.4% | 48.4% |
| 114 | Scottsdale | 85259 | 7,385 | 947 | 776 | 366 | 5.0% | 10.5% | 47.2% |
| 115 | Phoenix | 85012 | 1,371 | 156 | 128 | 67 | 4.9% | 9.3% | 52.3% |
| 116 | Scottsdale | 85255 | 14,482 | 1,760 | 1,470 | 695 | 4.8% | 10.2% | 47.3% |
| 117 | Tempe | 85283 | 9,333 | 1,088 | 893 | 436 | 4.7% | 9.6% | 48.8% |
| 118 | Phoenix | 85028 | 7,154 | 839 | 681 | 332 | 4.6% | 9.5% | 48.8% |
| 119 | Phoenix | 85018 | 9,201 | 1,163 | 905 | 421 | 4.6% | 9.8% | 46.5% |
| 120 | Carefree | 85377 | 1,396 | 135 | 118 | 63 | 4.5% | 8.5% | 53.4% |
| 121 | Wickenburg | 85390 | 2,399 | 211 | 176 | 106 | 4.4% | 7.3% | 60.2% |
| 122 | Scottsdale | 85266 | 5,411 | 553 | 495 | 237 | 4.4% | 9.1% | 47.9% |
| 123 | Phoenix | 85044 | 10,772 | 1,153 | 956 | 435 | 4.0% | 8.9% | 45.5% |
| 124 | Aguila | 85320 | 149 | 7 | 7 | 6 | 4.0% | 4.7% | 85.7% |
| 125 | Paradise Valley | 85253 | 6,524 | 639 | 521 | 231 | 3.5% | 8.0% | 44.3% |
| 126 | Scottsdale | 85258 | 6,403 | 574 | 471 | 211 | 3.3% | 7.4% | 44.8% |
| 127 | Sun Lakes | 85248 | 12,871 | 961 | 774 | 408 | 3.2% | 6.0% | 52.7% |
| 128 | Tempe | 85284 | 5,933 | 448 | 359 | 149 | 2.5% | 6.1% | 41.5% |
| 129 | Sun City | 85351 | 12,340 | 521 | 466 | 307 | 2.5% | 3.8% | 65.9% |
| 130 | Rio Verde | 85263 | 1,311 | 63 | 58 | 31 | 2.4% | 4.4% | 53.4% |
| 131 | Sun City West | 85375 | 15,806 | 362 | 325 | 200 | 1.3% | 2.1% | 61.5% |
We see that the two types of areas least affected by foreclosures are those containing higher end homes and the 55+ communities. In many of the luxury home areas we see a much lower percentage of NOTS resulting in TDs, often below 50%, which reflects a higher success rate in avoiding foreclosure, most frequently through a short sale. Certain sparsely populated and outer areas like Aguila, Fort McDowell, Rio Verde and Wickenburg are also less affected by foreclosures than the inner city areas.
It almost goes without saying that foreclosures have a direct effect on home pricing. Hence the ZIP Codes at the top of the Foreclosure Table are usually those where home prices have fallen the most since they peaked in 2005 through 2007, while those at the bottom of the Foreclosure Table have fallen the least. However the relationship is not exact and if we create a similar table for "Fall in Home Price $/SF Since the Peak" we see the following at the top:
| Rank | City | ZIP | Peak $/SF Qtrly Avg | Qtrly Avg $/SF Dec 2010 | Decline in $/SF Since Peak | Foreclosure Rank |
| 1 | Phoenix | 85009 | $154.23 | $25.27 | -83.6% | 27 |
| 2 | Phoenix | 85035 | $157.33 | $30.65 | -80.5% | 11 |
| 3 | Phoenix | 85031 | $132.12 | $26.31 | -80.1% | 10 |
| 4 | Phoenix | 85033 | $148.40 | $30.16 | -79.7% | 8 |
| 5 | Phoenix | 85017 | $149.98 | $30.79 | -79.5% | 16 |
| 6 | Phoenix | 85019 | $142.86 | $33.47 | -76.6% | 19 |
| 7 | Tonopah | 85354 | $149.71 | $38.26 | -74.4% | 5 |
| 8 | Phoenix | 85008 | $184.78 | $50.55 | -72.6% | 45 |
| 9 | Avondale | 85392 | $195.00 | $54.09 | -72.3% | 20 |
| 10 | Youngtown | 85363 | $155.00 | $43.09 | -72.2% | 14 |
| 11 | Glendale | 85301 | $143.74 | $40.18 | -72.0% | 26 |
| 12 | Buckeye | 85326 | $161.85 | $45.69 | -71.8% | 6 |
| 13 | El Mirage | 85335 | $153.82 | $45.43 | -70.5% | 4 |
| 14 | Phoenix | 85037 | $153.92 | $45.68 | -70.3% | 3 |
| 15 | Waddell | 85355 | $237.32 | $70.46 | -70.3% | 53 |
| 16 | Phoenix | 85040 | $158.54 | $47.37 | -70.1% | 24 |
| 17 | Phoenix | 85043 | $158.44 | $48.29 | -69.5% | 1 |
| 18 | Buckeye | 85396 | $210.32 | $65.46 | -68.9% | 32 |
| 19 | Phoenix | 85051 | $148.66 | $47.24 | -68.2% | 31 |
| 20 | Tolleson | 85353 | $148.36 | $47.93 | -67.7% | 2 |
Again, the West Valley is over-represented in this table. Looking for anomalies we see that Waddell 85355 has fallen in price further than one would expect based on the number of foreclosures there. The same applies to Phoenix 85008 and 85009.
At the bottom of the table, where prices have fallen the least we see:
| Rank | City | ZIP | Peak $/SF Qtrly Avg | Qtrly Avg $/SF Dec 2010 | Decline in $/SF Since Peak | Foreclosure Rank |
| 112 | Paradise Valley | 85253 | $509.75 | $259.88 | -49.0% | 125 |
| 113 | Tempe | 85282 | $171.09 | $87.35 | -48.9% | 109 |
| 114 | Phoenix | 85054 | $259.86 | $133.89 | -48.5% | 102 |
| 115 | Scottsdale | 85260 | $303.78 | $156.64 | -48.4% | 105 |
| 116 | Mesa | 85206 | $163.18 | $84.32 | -48.3% | 99 |
| 117 | Scottsdale | 85251 | $269.87 | $139.84 | -48.2% | 111 |
| 118 | Phoenix | 85045 | $214.22 | $111.24 | -48.1% | 98 |
| 119 | Gilbert | 85233 | $178.80 | $94.61 | -47.1% | 78 |
| 120 | Tempe | 85283 | $180.75 | $96.40 | -46.7% | 117 |
| 121 | Chandler | 85249 | $186.05 | $99.51 | -46.5% | 77 |
| 122 | Phoenix | 85044 | $208.56 | $111.82 | -46.4% | 123 |
| 123 | Scottsdale | 85258 | $317.63 | $170.51 | -46.3% | 126 |
| 124 | Chandler | 85286 | $181.65 | $99.03 | -45.5% | 79 |
| 125 | Scottsdale | 85254 | $243.68 | $133.85 | -45.1% | 104 |
| 126 | Scottsdale | 85259 | $311.72 | $171.86 | -44.9% | 114 |
| 127 | Phoenix | 85048 | $215.93 | $121.37 | -43.8% | 107 |
| 128 | Tempe | 85284 | $219.39 | $128.03 | -41.6% | 128 |
| 129 | Scottsdale | 85255 | $338.65 | $199.87 | -41.0% | 116 |
| 130 | Sun Lakes | 85248 | $198.80 | $118.55 | -40.4% | 127 |
| 131 | Sun City West | 85375 | $162.05 | $99.26 | -38.7% | 131 |
Only Sun City West 85375 represents the West Valley here, with the greatest preservation of $/SF across the whole valley. But then it also has had the lowest percentage of foreclosures. Again looking for anomalies we see that Chandler 85286 and 85249, Gilbert 85233 and Mesa 85205 have preserved their pricing better than would be expected based on their foreclosure rates.
We can also see that many parts of the Southeast Valley, particularly Tempe, Ahwatukee and South Chandler have preserved their pricing much better than Maricopa County as a whole. This is also true of most of the Northeast Valley.
Rio Verde has the second lowest foreclosure rate in the valley yet has lost 61.4% of its quarterly average $/SF since the peak, showing that factors other than foreclosures must be affecting its market. Sun City, with the third lowest foreclosure rate has lost 51.3% in $/SF so has fared significantly worse than its neighbor Sun City West.
Avondale 85323 has one of the worst foreclosure rates (ranked 7th) but only ranks 23rd in loss of $/SF (66.7%). Surprise 85379 has done even better in the face of adversity, ranked 9th for foreclosures but only 48th for loss of $/SF.
Despite the few anomalies, the analysis supports the generally held correlation between foreclosure rates and falling home prices. For the mathematically minded the correlation coefficient we found across the whole of Maricopa County is 0.79 (very high).
It is true that foreclosures cause home prices to fall, but it is a vicious cycle since it is also true that falling home prices cause foreclosures - they cause more homes to go underwater and their owners to feel less motivated to maintain their loan payments.
Please note that all the above analysis is for Maricopa County single family homes only and courtesy of The Cromford Report.
