WHY SO MANY "new" HOUSES FOR SALE - JUST A COUPLE OF YEARS OLD (Phoenix: transplants, foreclosures)

[kathymc]

I work in the local real estate office doing marketing etc. I am not an agent but here's what happened. In late 2004, investors discovered Casa Grande. They swarmed in and bought every house for sale in sight. New builders would not sell to them so they bought resale. Houses were selling within hours of being listed. There were bidding wars and prices went higher and higher over night. At the time, there were not a lot of new home builders in town. The people selling their houses were camping out, lotteries etc to buy new. Lenders were loaning to anyone-so called sub prime loans-to people with poor credit and loaning 125% of the list prices. The investors left town-on to cheaper markets and all the new builders arrived. The builders can afford to drop their prices as the market drops but of course the existing home sellers cannot compete with the incentives especially when they now owe more than they can sell their homes for. Buyers find the new homes more attractive due to pricing and the fact they are brand new. Existing home owners would love to take advantage of the great prices on the new homes but can't sell their homes. So here we are. It's a great time to buy if you don't need to sell a home and interest rates are great if you have good credit!

[wit-nit]

Termites are not the problem. People @ 2yrs ago bought on the overpriced high bubble , most of them with ARM's and they were overextended. Many thought their investments would continue to rise. Well the bubble burst, the ARM's went up and now those people are caught between a rock and a hard place. Foreclosuers are at an all time high because of this situation. Also there have been some loan scandals lately causing some problems with people who dealt with those companies.
Note: many people buy homes on a barely affordable budget and then they overextend themselves furnishing the house, landscaping etal and that puts them deeper in the hole.

[artichoke63]

Originally Posted by ejk

In our neighborhood, it's investors. Many of the houses for sale here are vacant.

Wow. This is truly amazing. Most of the homes on your street are empty?

[country pride]

I may have already mentioned this but there too, are many houses, new and old, out here, that have had 'for sale' signs on them for a long time, some for two years, and many, never been lived in yet. The weeds are as high as my thighs. (And I thought HOA had a 'thing' about maintaining yards?)

[ejk]

Originally Posted by artichoke63

Wow. This is truly amazing. Most of the homes on your street are empty?

No. Many of the homes for sale are empty. But most of the homes on our street are lived in.

[sheena]

Originally Posted by L_A_Woman

I may have already mentioned this but there too, are many houses, new and old, out here, that have had 'for sale' signs on them for a long time, some for two years, and many, never been lived in yet. The weeds are as high as my thighs. (And I thought HOA had a 'thing' about maintaining yards?)

It depends on how much the HOA's enforce these laws. A friend of mine lives over on the west side and their are about 5 vacant homes within 2 streets and the weeds are growing out of sight. She has tried to get something done but so far nothing. The homes have been for sale a longgggg time.

[azloafer]

I just talked to a realtor this AM and she said that the average person, country wide, used to move every 7 1/2 years. Now it is more like 5 1/2 years. I know many people will say that those figures are wrong because they have been in their house for 20 or 30 years, but this is the national average that the realtors are talking about.

[brandnewme]

ALL OF THE ABOVE AND.....A lot of people moved to AZ not realizing how different it is from where they came from. They didn't do enough research and visit numerous times to check out the weather. The heat does a real number on people here. It totally changes the way you live your daily life. You are trapped inside your air condioned home 24/7 pretty much from now until October and that is a tough thing to get adjusted to. Most in my area are selling because they purchased for pennies and wanted to make a killing with the booming real estate, which by the way has slowed down so much that they aren't able to sell now! You can purchase a brand new home for the same price as one that has been lived in so why not go with the new one!

[gregandvicky]

Something to also consider. A lot of the builders in Arizona have been gouging buyers for a couple of years now. I just received a letter from Avatar in Rio Rico saying they have reduced their prices by $40,000. That means they over charged buyers by that much or more since building material and labor costs have not changed. I do not think I want to do business with people that use those practices. How would you like to be they guy that bought his house two months ago for $220,000 and they are selling new today for $180,000?

[sablebaby]

Originally Posted by gregandvicky

Something to also consider. A lot of the builders in Arizona have been gouging buyers for a couple of years now. I just received a letter from Avatar in Rio Rico saying they have reduced their prices by $40,000. That means they over charged buyers by that much or more since building material and labor costs have not changed. I do not think I want to do business with people that use those practices. How would you like to be they guy that bought his house two months ago for $220,000 and they are selling new today for $180,000?

That happened to SO many people and it's not really from poor business practices. It's more because the RE market headed that way and they kept up with it. Now the market has been coming down. I bought my house for $300k back in Jan last year and it went down $40k a few months later. Now it's slowly climbing back up. That's what happens in a crazy market, but I'm not blaming the builder, or the previous owner for staying within the range of the market.