Phoenix Real Estate Market Keeps Tanking (section 8, sublet, apartment complex)

[Potential_Landlord]

Originally Posted by Kimballette

Folks, this is the Phoenix, Arizona forum. Discussion of real estate market in Texas is off topic. Please move that discussion to another forum. Thanks.

I'm with Kimbalette. Let's look at Phoenix again. In my north-Phoenix zip, there are about 26 SFH for sale in the price range and age of my home. 21 are AWC and only 5 are active. Is this normal? - It seems any new actives become AWC within a week. BTW in my area short sales are still very dominant.

[Burning Madolf]

Originally Posted by Potential_Landlord

I'm with Kimbalette. Let's look at Phoenix again. In my north-Phoenix zip, there are about 26 SFH for sale in the price range and age of my home. 21 are AWC and only 5 are active. Is this normal? - It seems any new actives become AWC within a week. BTW in my area short sales are still very dominant.

As has been pointed out here many times, the lower end of the market is HOT. 2 days and gone is not unusual in some areas.

[MN-Born-n-Raised]

Originally Posted by Burning Madolf

The reason this won't be another huge bubble is mortgages, plain and simple.

We agree. The reason why I brought up the cost of NEW homes is it sort of caps any possible runaway pricing. I like others, think it is interesting to quote what the home sold for in 2006. In my case, someone took a 67% beating. But the cost to re-build is over 40% less in 2012 versus 2006. With the increase in previously own homes, that difference has shrunk.

If new build costs somewhat hold the REO's probably won't pass the new pricing in newer areas like Gilbert, Surprise, Anthem, etc. That's why new homes are selling again. New homes put pressure on previously owned home prices.

[Zippyman]

Originally Posted by MN-Born-n-Raised

We agree. The reason why I brought up the cost of NEW homes is it sort of caps any possible runaway pricing. I like others, think it is interesting to quote what the home sold for in 2006. In my case, someone took a 67% beating. But the cost to re-build is over 40% less in 2012 versus 2006. With the increase in previously own homes, that difference has shrunk.

If new build costs somewhat hold the REO's probably won't pass the new pricing in newer areas like Gilbert, Surprise, Anthem, etc. That's why new homes are selling again. New homes put pressure on previously owned home prices.

Keep in mind, that only works until an area has been "built out" - in Maricopa or Queen Creek, there's more land available, so a buyer can compare new & old, in other areas, the lots are all occupied. Buying new means a longer commute.

As for construction costs holding steady, it doesnt seem likely. I'm currently doing a rehab, and the guys doing the work for me are all pretty busy, and having trouble finding helpers. It's a long way from another " boom", but they're already trying to raise prices. I'm really glad I fixed up my primary residence a couple of years ago, it would cost more for the same work now.

[actinic]

Originally Posted by Captain Bill

The Cromford Report called the bottom in April 2009

That says it all.

[actinic]

Originally Posted by Burning Madolf

Detroit and Cleveland?

You're right ... home values in Phoenix have dropped considerably more than those 2 cities.

http://4.bp.blogspot.com/-5gi86DDiWY...iesDec2011.jpg

[actinic]

Originally Posted by Ponderosa

This ain't right. It is something that FNMA and FHA could deal with too, without the do nothing Congress. In econ, the value is what someone is willing to pay, not some opinion of worth. If you have multiple bidders on a house, particularly cash bidders, that should be the value. Eventually, of course, the higher cash offers will work into the comps, but it takes times and keeps potential owners (much more desirable than investors) on the sidelines until prices go even higher for them. Just another example of how the little man gets screwed.

Originally Posted by Captain Bill

It really isn't that one sided. It's a matter of who has the cash and is "willing" to pay above current market value.

Many investors are getting mortgages, and many regular buyers are paying cash.

Yes, investors do (and in many cases favor) getting a mortgage.

Your reply confirms that those who suggest others don't have a clue about finance are actually the clueless ones. A welcome reality check.

[actinic]

Originally Posted by Burning Madolf

As has been pointed out here many times, the lower end of the market is HOT. 2 days and gone is not unusual in some areas.

Does this mean the overall housing market is improving or is a sign the metro area is morphing into a proportionately greater number of lower income owners purchasing cheaper homes?

[Ponderosa]

Originally Posted by actinic

Does this mean the overall housing market is improving or is a sign the metro area is morphing into a proportionately greater number of lower income owners purchasing cheaper homes?

Both to some degree. But what I see is a lot of investors, both individuals and groups, grabbing anything that comes on the market at the sub 100-150 prices and foreigners and out of state people buying second homes. We have two sets of part-time Canadians living on our street now. They say it is cheaper to buy a house in AZ than a motor home.

[Howard Roark]

Oh I agree. I keep tabs on my "nabe" on internet. A house I liked that is Mediterranean style (but did not like only because the next door house is two stories) was bought for $225k last August and they are asking $339k. There are games going on in my area. I'm not taking the bait.

This real estate bubble is not at the bottom yet. Jobs are coming back but wages are still low. I'm expected to work extra hours for free and I'm a consultant (paid by the hour). This is going on all over the place. The income is not anywhere to support the glut of decent homes, which cost at least $225k.

Originally Posted by azriverfan.

I'm already seeing the flippers in action. Three houses I'm watching were purchased for fire sale prices and in less than a year, they are back on the market listed for 30%-40% higher than what was paid for them. And they really didn't do much but essentially clean up the places (new paint, mowed the lawn, furnished the home, took better pics). It's ridiculous. What's comical is that in the internet age, you can see what the flipper paid for the home 8 months ago. Do they really think people are that stupid and desperate to pay $200K-300K more for a home that was purchased a year ago when they did nothing? The Greed is back!