U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > U.S. Forums > Arizona > Phoenix area
 [Register]
Please register to participate in our discussions with 1.5 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Jump to a detailed profile or search
site with Google Custom Search

Search Forums  (Advanced)
Business Search - 14 Million verified businesses
Search for:  near: 
Thread summary:

Arizona: market, real estate, new construction, buy homes, realtor, mortgage.

Reply Start New Thread
 
Old 11-02-2007, 11:34 AM
 
Location: Phoenix, AZ
6 posts, read 10,899 times
Reputation: 10
The market glut is much wider to be influenced by a few new developments. An interesting fact about them, though: even if they know nobody will by the developments, it is cheaper for developers to just build whole neighborhoods that then go unsold than to stop construction all together. Even if they did hurt the economy, they'd have to build them anyway.
Reply With Quote Quick reply to this message

 
Old 11-02-2007, 05:04 PM
 
Location: Sunny Phoenix Arizona...wishing for a beach.
4,299 posts, read 10,012,909 times
Reputation: 749
Quote:
Originally Posted by BillyBaroo View Post
When we started shopping for a new home earlier this year, we thought people were asking too much for their houses. We found that we could build a new home and get a larger house for less money. Most of the homeowners were trying to get more money than what their house was really worth.

This summer we signed a contract with Pulte for a house in Red Rock. Last month we drove out there to see how things were looking. They told us we could get a bigger house and they'd give us another $30,000 off the price and $10,000 off the price of the lot. We ended up getting an additional 1200 sq ft for almost the same price. We couldn't be happier and just have to wait an additional three months, which actually works better because the kids will finish the school year here before we move.

I think if most people are given the option, they'll build a new home rather than buy an older house for the same price.


I agree the builders can drop their prices a lot easier than some homeowners can or are willing to do.
Reply With Quote Quick reply to this message
 
Old 11-02-2007, 05:06 PM
 
Location: Sunny Phoenix Arizona...wishing for a beach.
4,299 posts, read 10,012,909 times
Reputation: 749
Quote:
Originally Posted by elizmeese View Post
The market glut is much wider to be influenced by a few new developments. An interesting fact about them, though: even if they know nobody will by the developments, it is cheaper for developers to just build whole neighborhoods that then go unsold than to stop construction all together. Even if they did hurt the economy, they'd have to build them anyway.

The builders will do what they need to do to keep chugging along and they played a major role in artificially inflating the market.
Reply With Quote Quick reply to this message
 
Old 11-02-2007, 05:54 PM
 
82 posts, read 231,024 times
Reputation: 39
Builders can't sell if theres no demand. People started demanding more for their "investments" and so the builders obliged. Its all about supply and demand, demand increases, and dose supply.
Reply With Quote Quick reply to this message
 
Old 11-02-2007, 07:39 PM
 
Location: Sunny Phoenix Arizona...wishing for a beach.
4,299 posts, read 10,012,909 times
Reputation: 749
Quote:
Originally Posted by FunkyPioneer View Post
Builders can't sell if theres no demand. People started demanding more for their "investments" and so the builders obliged. Its all about supply and demand, demand increases, and dose supply.

I agree...........................
Reply With Quote Quick reply to this message
 
Old 11-03-2007, 06:04 AM
 
Location: Gilbert - Val Vista Lakes
6,066 posts, read 8,037,599 times
Reputation: 3657
I think the problem was with the builders over building, too many new-investors buying in as the momentum built up, and the sub-prime mortgages.

Builders are cutting back on the starts now, and that will help reduce the inventory.

Soon the public will realize that the 200,000 foreclosures expected is only 5% of the total inventory of 4,000,000 homes on the market, and that the sub-prime market is small.

There is a large pent up demand for homes, and those people needing homes are on the fence because of the mis-information (sensationalism reporting) by the media. Once these people begin to buy, that will also help the inventory to be reduced.

Here's an example of how a media puts a negative spin on something positive. This is quoted from a Business Week article.

"The housing market is being forecast to hit bottom during the 1st quarter of 2008. After that the decline will be smaller."

Bill
Reply With Quote Quick reply to this message
 
Old 11-03-2007, 03:08 PM
jco jco started this thread
 
Location: Austin
2,106 posts, read 4,503,190 times
Reputation: 1326
I think you're right, Captain Bill, about there being a pent up demand for homes if you mean that A LOT of buyers are just waiting for the market to hit rock bottom so that they can snatch up their house. I don't think we'll have another bubble, though, because I'm sure that investors will have a little more sense when the market recovers (at least I hope). When the market does go back up, though, the builders will still have to compete with a huge list of homes on the market. I know that it's supply and demand, and everyone go get your dollar, but home builders are messing with people's money, and it seems that something should restrict them from manipulating the market/prices like this.
Reply With Quote Quick reply to this message
 
Old 11-03-2007, 03:15 PM
 
25 posts, read 78,474 times
Reputation: 21
Quote:
Originally Posted by jco View Post
It seems, just from reading through threads on this forum, that people are choosing to build new instead of buying resale. This seems to only encourage a continued saturated market and bring home prices down even more. Do you think that new home builders can be blamed for the bubble and its lasting effects in 2007? Most want to blame investors and investors alone, but I wonder if new home builders should share in that.
Noup, to low earnings should be blame for that.
Reply With Quote Quick reply to this message
 
Old 11-04-2007, 08:27 AM
 
Location: Gilbert - Val Vista Lakes
6,066 posts, read 8,037,599 times
Reputation: 3657
Quote:
Originally Posted by jco View Post
I think you're right, Captain Bill, about there being a pent up demand for homes if you mean that A LOT of buyers are just waiting for the market to hit rock bottom so that they can snatch up their house. I don't think we'll have another bubble, though, because I'm sure that investors will have a little more sense when the market recovers (at least I hope). When the market does go back up, though, the builders will still have to compete with a huge list of homes on the market. I know that it's supply and demand, and everyone go get your dollar, but home builders are messing with people's money, and it seems that something should restrict them from manipulating the market/prices like this.
Jco, I think it's really a small percentage of buyers who are trying to time the bottom, and they are the ones who usually repeat the negativism that the press puts out. Many think they can manipulate the market like that. This goes on in stock market forums all the time.

The investors are out buying now.

I think the vast majority of people who are holding off are ones who have been spooked by the negative reportings of the press. They are not looking to bottom fish because they'll be in their homes for a long time. They are just afraid that the decline may last for years.

As soon as they realize that this is just a cyclical correction because of the unsustainable run up of the last few years, and that by buying and holding real estate for at least 6 years they will come out ahead, they will begin to make their purchases.

Many people think that the economy is not doing well, but that is not the case, as I see it. There are jobs continuously being created, and statistics show that for every 2 jobs created, one of those will require a house.

Phoenix is still the destination for relocations, because of the weather. It's also a much cheaper place to live than California and many Californians are moving here every day.

I just received a referral for a client who is selling their home on the water at Santa Cruz, CA. Those homes sell as fast as they go on the market, and they're expenisive. This client is cashing out of their home on the water, paying cash for a home here in Gilbert, and using the balance for their retirement funds.

I work with both buyers and sellers and I tell them all the same thing. If a seller does not need to sell today, then they should keep their home off the market until the market is level. If they need to sell it today, then they need to price it at the current market value, not the 2005 value -- or it won't sell.

For buyers I tell them that if they buy today, they should expect to pay the fair market value of today. They cannot expect a seller to sell a home based on what the buyer feels the market will do in 6 months. We don't know what the market value will be in 6 months.

If the buyer waits, they may luck out and get a little lower price -- Or they may pay a higher price. But today there is a greater selection to choose from, and tomorrow that selection will have been cherry picked by the smart buyers of today.

If they plan on keeping the home for 6 years or more, then today is the time to buy in my opinion. If they may need to sell the home within one or two years, then I advise them to wait awhile before buying.

Bill
Reply With Quote Quick reply to this message
 
Old 11-04-2007, 02:04 PM
 
573 posts, read 1,134,033 times
Reputation: 303
Quote:
Originally Posted by Captain Bill View Post
As soon as they realize that this is just a cyclical correction because of the unsustainable run up of the last few years, and that by buying and holding real estate for at least 6 years they will come out ahead, they will begin to make their purchases.

Many people think that the economy is not doing well, but that is not the case, as I see it. There are jobs continuously being created, and statistics show that for every 2 jobs created, one of those will require a house.

If they plan on keeping the home for 6 years or more, then today is the time to buy in my opinion. If they may need to sell the home within one or two years, then I advise them to wait awhile before buying.

Bill
I actually agree with a lot of what you posted... and I'm a fence sitter right now.

I do question the above statements though.

1. In many places recent run-ups were unprecedented and current prices have absolutely no connection to fundamentals, so who is to say that the correction will be typical?
Plus I think saying it is just a cyclical correction discounts the effect of the easy money environment of the past few years, not to mention the role of more and more investors/flippers, or the overbuilding we've been discussing in this thread.

2. I actually hope you're right about the economy. I'm not so sure though. Personally I think rapidly rising home prices were the oil that greased the wheel of the engine of economic growth. Everything else was smoke and mirrors. Declining house prices could very well bring everything to a grinding halt and there are plenty of other issues lurking that could send the economy into a tailspin.

3. I'd say the 6 year figure applies under normal conditions. In the current environment I'd certainly be looking at a minimum longer than that!
Exactly why we are fence sitting right now... and in a neighborhood we could never afford to comfortably buy in at today's prices; yet our rent is well within our comfort zone.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Options
X
Data:
Loading data...
Based on 2000-2011 data
Loading data...

123
Hide US histogram

Over $84,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > U.S. Forums > Arizona > Phoenix area
Similar Threads

All times are GMT -6.

2005-2014, Advameg, Inc.

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25 - Top