Phoenix MLS Predicting Lowest Median September Price in Nine Years (Surprise: buyers, college)

[SOON2BNSURPRISE]

Originally Posted by Howard Roark

Flying from Los Angeles to Phoenix once, I met a man who has a house and family in Phoenix and flies there every weekend, but during the weekdays lives on a friend's boat in Redondo Beach. The man is a grip for the movie industry. He said he's been living that way for over ten years. So it's not just me but other people who are doing long distance commuting.

I for one would love to try it out. Most of my family is now in the Phoenix area. My parents are now in their 70's and don't always want to travel out to the coast anymore. They like their life in the Valley of the Sun. Look prices are down in most places, but finding a home that is under $100,000 would be very hard to do even in Oxnard, CA. I know some are alluding to the fact that why would anyone want to buy a home in a place that sells for under $100,000. My thought though is what if you like the area? What if you like the home? What if your plan is to find an affordable home that you can purchase now and pay off in less than 10 years and yes even retire in? I see the possiblilties now in areas like Surprise and even El Mirage. That place has very low cost homes and seems to have been cleaning up their act.

[MotleyCrew]

Originally Posted by SOON2BNSURPRISE

I for one would love to try it out. Most of my family is now in the Phoenix area. My parents are now in their 70's and don't always want to travel out to the coast anymore. They like their life in the Valley of the Sun. Look prices are down in most places, but finding a home that is under $100,000 would be very hard to do even in Oxnard, CA. I know some are alluding to the fact that why would anyone want to buy a home in a place that sells for under $100,000. My thought though is what if you like the area? What if you like the home? What if your plan is to find an affordable home that you can purchase now and pay off in less than 10 years and yes even retire in? I see the possiblilties now in areas like Surprise and even El Mirage. That place has very low cost homes and seems to have been cleaning up their act.

We have found a few very nice spots around Surprise and the homes are under $100,000. The neighborhoods are clean/blue collar and the people are very decent. Kingswood Park is one of them and Citrus Point another. It may not be luxury housing but it is decent and there are some retired people there as well. We have familiy living in one of these and I can tell you the teenagers there are for the most part, better behaved than the development I live in now.

[rjrcm]

Originally Posted by EnicAZ

... According to my ARMLS statistics, there is a prediction of prices to take a major decline from here on out. ...

Can you elaborate on what ARMLS statistics you are referring to and how you arrived at such a conclusion?

[azriverfan.]

Originally Posted by Ponderosa

A good and often glossed over point especially for people from Canada or somewhere who want to buy low, rent it out and retire there 10 years down the road. And, in many of them there is no need to wait 10 years. You can already see it.

What's funny is the same thing is happening in Chandler. Houses that were once selling for 600-700 are selling for 250-300K. Guess who is moving into those once prestigious neighborhoods. You can see the decline in some of those neighborhoods already. I can only imagine the crowd moving into the 100k homes. It's true what they say, you get what you pay for. It's getting to the point that I'm considering moving to a more expensive and bigger house just so my kids can actually play in the neighborhood without getting run over by a drunk teenager driving an El Camino truck. It was never that way 3 years ago.

[AndroidAZ]

Originally Posted by las vegas drunk

Now wait a second, I never claimed to be an expert because I am not. I said I listen to the experts who know much more than me and follow them. The fact is the doom and gloomer experts have been consistently right recently. Here is a new article you will surely discredit, but I tend to believe what it says, especially this:

"The Housing Industry Will Never Fully Recover Without A Jobs Recovery First"

Home Sales Drop 27 Percent In July And Things Are Only Going To Get Worse For The U.S. Housing Industry

You are again dodging the question.

I'm not asking about the future of housing. I'm asking for you to prove how you know a service economy is not going to be as prosperous as a production economy.

This continued skirting of the issue really is humorous.

[azriverfan.]

Originally Posted by EnicAZ

As an agent, I have to be honest and say the drop in prices is a sure thing. It is already happening. By the time this is over, I think we will see prices drop another 25-30% in the Phoenix area. Others in my office think it will drop 30-40% from here.

There are just too few jobs in the Phoenix area, and the housing market was being artificially propped up by government incentives. I wish something could stop the fall out. I have heard that ostrich farms are an up and coming business, because of their tender meat.

Okay, now this is obviously a clandenstine hater driven message in the guise of a "I'm just an agent" The prices will not drop another 30-40%, that is just negative propaganda. Phoenix didn't have a lot of jobs 5 years ago either. This is a retirement and tourist community. If prices drop another 20% let alone 25-30%, you can be assured outside investors and retirees will grab those considering they are already circling our housing community like vultures and are just waiting for prices to drop further. There is a lot of money in this city and people with money are not idiots. They are not going to buy homes knowing that prices are realistically going to continue to fall but it's not going to the point that house values will drop 30-40%; that is just such an uneducated response

[rjrcm]

Originally Posted by las vegas drunk

...
"The Housing Industry Will Never Fully Recover Without A Jobs Recovery First"

Home Sales Drop 27 Percent In July And Things Are Only Going To Get Worse For The U.S. Housing Industry

Originally Posted by AndroidAZ

...I'm asking for you to prove how you know a service economy is not going to be as prosperous as a production economy....

Because he read it on the internet .

LV Drunk - FYI, your link is to a rip-off site that steals other peoples' articles without attribution. The original article and author info is here:

Things Are Only Going to Get Worse for Housing -- Seeking Alpha

[Ritchie_az]

“It’s entirely likely that markets like Arizona will not recover even in the 15- to 20-year time frame,” said Mr. Humphries of Zillow. “The demand doesn’t exist.”

The reason I can't agree with this is because the population is still growing. People are still having babies. Babies are still growing up into young adults. Young adults are still gowing off to college, etc. There is a need for houses (see: demand). That does not mean that everyone will be home owners--renters equate into this as well (investors and opportunists will buy the homes to rent out). Unless 500,000 or more of us all-of-a-sudden walk away from the Phoenix area, there will be a demand, even if it's a small one.

I can't agree, the land value underneath could actually be more of a liability (tax, upkeep) than whatever paper value remains on it. In essense, the value of even the land can be below zero. This is something which I learned in real estate licensing school.

Did they tell you that home prices that are less than the cost to build are unsustainable? The homes at the very bottom of the market that were for sale for less than the cost-to-build had 10 or more people (mostly investors with cash) trying to buy them. Why? Because it's a sure thing. At some point, the value of the house will rise--the market says it must. So even if it drops a little after it's purchased, it's a sure thing that it will rise to a level at least equal to (but likely higher than) the cost to build.
That's why these predictions that the market will fall 35% or more are all B.S. That would put the whole valley below the cost to build. That is not sustainable. Investors and opportunists from across the world would be buying up all the homes, which would cause the market to go up.
Already you see folks from Canada and England in the market to purchase homes here (because of where the market fell). Make no mistake: if the market dips more--even just 1% or 2%--that will convince someone, somewhere to buy a home here. There will be buyers. And those buyers will cause the market to rise.

[Pirate0202]

I can see this as another reason to wait and see before buying quickly in this market. In just a couple years, the great neighborhood you thought you bought into at a "screaming deal" might be in the heart of a run-down, bad area. I would hope that people who bought in at a low price would use the rest of the money to keep the place up, but I'm guessing that may not apply to the bulk of the people that will be buying those homes. It will probably be people who, again, will buy something in the upper limit of what they can afford as a mortgage only and will be just as cash-strapped as people were a few short years ago, only now there is a $300K difference in home value, and a different kind of buyer.

[ruby40]

At what price point do you think its safe to buy where the neighborhoods won't be dumps in 10 years?