With great freeway access, nearby shopping and a variety of housing options, northeast Phoenix's Desert Ridge neighborhood has a lot to offer.

But 20 years after it was conceived, and two years after the last major land sale, those involved say they expected the development to be much further along.

Numerous large parcels remain undeveloped, including the area east of 56th Street and north of Loop 101.

The recession is blamed in part for the slowdown. Combined with the requirement that the Arizona State Land Department sell its land at the highest possible price, it makes home building and selling difficult.

In ZIP code 85050, where most of Desert Ridge's current housing is, median values climbed from nearly $200,000 in 2003 to almost $500,000 in 2006, only to settle back to $340,000 in 2008, according to Information Market.

The decline in home prices changed the economics of land sales that had occurred as prices were climbing, leading five land buyers to default on contracts with the Land Department.

The five parcels accounted for about 20 percent of the land and a third of the homes planned for the area.

Another parcel, close to 290 acres west of 56th Street on the north side of Loop 101, has not defaulted, but it has seen no development almost four years after its sale to Meritage Homes.

The main problem, State Land officials say, is that the market will not support development at this time.

Land Commissioner Mark Winkleman said no additional sales are planned until the economy improves.

"We recognize development is subject to market demand and the complexities of preparing raw sites for construction," said Tim Campbell, a longtime Desert Ridge planner who now works for the Klutznick Co. "The Land Department has limited resources to devote to planning, infrastructure and obtaining approvals necessary for development of a particular site."

But even though things are tough now, planners expect it to bounce back quickly.

The area's desirability has been proven by home builders and buyers who are in the area, Campbell says.

And Winkleman points out that the area continues to have advantages of freeway access and the quality of the development. "The private sector has shown that it recognizes the value," he said. "We'll get back to that when the economy improves."

Story courtesy of The Arizona Republic

Market Condition Snapshot in 85050 (Desert Ridge Area)

Single Family Homes Sales in 85050 - March, 2009

* DOM - Days on the market.
All values are average and deemed reliable but not guaranteed.