Realtor Lara Abend, left, shows a home at Rancho Sahuarita to Stacey Wheeler and her two sons, Connor, 5, and Austin, 3. "Honestly, despite the obvious market decline, my business has doubled since last year," Abend says.

Photos by A.E. Araiza / Arizona Daily Star

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Sahuarita's red-hot housing market has slowed in recent months to a point where it's merely "normal," a local real-estate-market expert says.

The 3.3 percent growth in Tucson-area home sales in fiscal 2005 will probably fall to somewhere between 2.6 percent to 2.9 percent by the end of this fiscal year, said John Strobeck, an area housing market analyst.

The slowdown in residential construction may appear more dramatic because it follows two very hot years in the local real-estate market, he said.

So, Strobeck said, "Don't say this is a bad market. We're still going to do the third-highest volume of sales ever this year," in the Tucson metro area.

Still, town officials suspect the slowdown probably played a big role in last month's decision by American-Nevada Co. officials to withdraw its request for the town to annex about 5,000 acres west of Sahuarita, where the company had proposed to build up to 15,000 homes.

Strobeck predicts the residential market will remain at the present pace through 2007 and then pick up in 2008.

Ken Herb, an associate broker at Coldwell Banker Residential Brokerage in Green Valley, agrees home sales have slowed over the past few months because, "It's getting back to more of a normal market."

That means it's taking longer to sell houses, but he says the market is still strong, he said.

Of benefit to prospective home buyers, Herb said, are incentives such as free pools or backyard patios, as well as "some really stunning discounts" on such incentives.

The slowdown has reduced the flow of revenues to the town of Sahuarita generated by construction, especially the construction sales tax, said Jim Stahle, town manager. That won't have an immediate effect, because the revenues were generated months ago, when builders applied for permits.

But there may be some long-term impacts, he said.

"We will take that into consideration when we put together our capital-improvement program next year," Stahle said.

The only short-term action town officials might take is delaying hiring another building inspector, he said.

A.C. Marriotti, the town's finance director, said the slowdown has reduced the three main sources of construction-related revenues for the town — building permits, sewer connection fees and construction sales taxes. All are down so far this fiscal year, which began July 1, from the pace set over the past two years, he said.

Town officials knew that construction in Sahuarita eventually would slow, so they budgeted accordingly and slowed down spending on capital-improvement projects for the coming fiscal years, Marriotti said.

He added, "The slowdown to this point, however, is more than anticipated. We're very concerned about that."

To get a better idea about the potential impact of the falling revenues, Stahle said he has directed staffers to review population-growth projections for the coming years.

Marriotti said, "As of July 1, 2006, we estimated our population at about 19,235 people. That estimate may get revised down — I'm hearing something in the 18,000-person range. That could certainly have an impact."

Town officials use population projections to anticipate con- struction-related revenue and to anticipate the need for additional facilities and services.

Commercial construction — work done on buildings used by businesses — will help offset the reduced residential-construction revenue, Marriotti said.

"Madera Marketplace is the hot spot," he said. The Wal-Mart there is well-established, and now satellite activities such as a bank branch and drugstore are under construction.

Other projects include renovation of the building that houses Ashley Furniture HomeStore, the Anza Trail K-8 school and the municipal complex near Sahuarita and La Villita roads.

Those projects, and a $62 million Carondelet Health Network hospital to be built next to the municipal complex beginning in 2010, make Coldwell Banker real-estate agent Debbie Wyrsch optimistic.

"There may be some bad news, but I see more positives than I see negatives," Wyrsch said.

Lara Abend, an agent with Tucson-based Professional Realty Services who said she spends 90 percent of her time in Sahuarita, agrees.

"Honestly, despite the obvious market decline, my business has doubled since last year."