PHOENIX MARKET UPDATE, Why is inventory low? (Surprise: rent, mortgages)

[MN-Born-n-Raised]

Originally Posted by Morotoriumxxl

House prices have nowhere to go but down, in Phoenix at least another 50%.
The Fed is desperate to create another housing bubble. That's all they know. They think 'growth' and inflation are the only story and don't see that everything in nature has to rest, has to deflate. They keep pumping, pumping, trying to protect the banks that will still be gored if housing takes another leg down, which it will. It is destined for another big leg down.


This housing mini-boom is a scam invented by Bernanke and the Big Banks and the weak White House leadership in order to prevent another meldown in housing prices and send the banks into the second stage of their insolvency.

Public relations. Lure more buyers into the market and trap them in overpriced housing as the last chance to avoid the deflation cataclysm.

Of course Bernanke did everything in his power to stop the housing slide. You make it sound like a secret or something. Basically he pulled down interest rates well below historical levels which spurred a sense of urgency. This created a "bottom". He also intentionally inflated our dollar by printing money. Guess what happened? Housing prices went up, people stopped foreclosing, families who were sitting on the side lines finally became buyers, etc! Ta-da! You figured it out.

That is why I bought in Phoenix early 2011. So while others were saying that housing was going to drop even further, I jumped on board early. That said, the Phoenix housing market will rise over the next year even with 5% interest rates. Raising housing interest rates was also Bernanke's plan to cool things down some. If it doesn't cool it enough, he will raise it some more. So far so good.

Now our economy can collapse because of other factors. The worlds massive debt and mismanagement might be the end game. But IMHO your theory of medium income theory is non-sense. People buy payments. The median income folks don't care about how much something costs, they care about their payments. So long as they can make their payments, your theory is flawed.

[jimj]

Originally Posted by MN-Born-n-Raised

Of course Bernanke did everything in his power to stop the housing slide. You make it sound like a secret or something. Basically he pulled down interest rates well below historical levels which spurred a sense of urgency. This created a "bottom". He also intentionally inflated our dollar by printing money. Guess what happened? Housing prices went up, people stopped foreclosing, families who were sitting on the side lines finally became buyers, etc! Ta-da! You figured it out.

That is why I bought in Phoenix early 2011. So while others were saying that housing was going to drop even further, I jumped on board early. That said, the Phoenix housing market will rise over the next year even with 5% interest rates. Raising housing interest rates was also Bernanke's plan to cool things down some. If it doesn't cool it enough, he will raise it some more. So far so good.

Now our economy can collapse because of other factors. The worlds massive debt and mismanagement might be the end game. But IMHO your theory of medium income theory is non-sense. People buy payments. The median income folks don't care about how much something costs, they care about their payments. So long as they can make their payments, your theory is flawed.

To add to what you're saying people (generally) aren't looking at owning the house in 30 years, they're looking at having a place to stay for the next year or three, five at the outside where the payment won't go up due to a landlord needing/wanting more.

The other big flaw in the "doomsday" prediction is if housing actually dropped like described that'd be the last thing people would be worried about as many more important things would be crashing as well.

[MN-Born-n-Raised]

Originally Posted by jimj

To add to what you're saying people (generally) aren't looking at owning the house in 30 years, they're looking at having a place to stay for the next year or three, five at the outside where the payment won't go up due to a landlord needing/wanting more.

The other big flaw in the "doomsday" prediction is if housing actually dropped like described that'd be the last thing people would be worried about as many more important things would be crashing as well.

We are in uncharted territories with this massive government debt all across the world. So if Morotoriumxxl made that point, I could take him more seriously. I would also agree that the average standard of living has taken a hit because we no longer "own" a lot of industries. Meaning we have global competition and there are wage pressures. People say competition is good. Not really for the workers and business owners ESPECIALLY when you were 1st in so many industries like the USA. I diverge...

My point is housing payments in Phoenix are cheap in comparison to many other spots in the country. So his theory on median income is one dimensional and over simplistic.

[jimj]

Originally Posted by MN-Born-n-Raised

We are in uncharted territories with this massive government debt all across the world. So if Morotoriumxxl made that point, I could take him more seriously. I would also agree that the average standard of living has taken a hit because we no longer "own" a lot of industries. Meaning we have global competition and there are wage pressures. People say competition is good. Not really for the workers and business owners ESPECIALLY when you were 1st in so many industries like the USA. I diverge...

My point is housing payments in Phoenix are cheap in comparison to many other spots in the country. So his theory on median income is one dimensional and over simplistic.

Agreed.

[BestintheWest]

Not sure if anyone follows all of the new listings in the valley, but has anyone else noticed that the majority of new listings are older and sort of undesirable homes?
Looks like homes people are just trying to get rid of due to the mild turn around, higher prices and shortage of inventory.

[warmbeerhater]

Actually, it was the lowest priced houses that led the recovery, and brought out the cash buyers.

[ILikeEveryone]

Originally Posted by Morotoriumxxl

You guys are delusional. Home prices in are once again rising for the wrong reasons and need to reverse another 60% to be in line with median income.
Housing recovery is a fraud created by Wall Street, Banks and the Fed.

So you are saying it's just another C-O-N-spiracy? LOL.

Just the fact that you don't see posters like Bill adding much these days, tells you how the market is going.

I very, very briefly skimmed the Cromwell Report (way too long for this novice), and also have the monthly ARMLS forwarded to me along with a couple of other monthly confidence reports. The writing is on the wall, even in the specialty market that I follow.

If you are a buyer with excellent credit, here is what you will need to do. (I think I stated this in a previous post.)

1. Have a trusted buyer's broker who is working for you, knows what you want, and will be able to put a bid in on a property as soon as it comes on the market.

2. Be pre-approved with a local lender beforehand so if you give the go ahead to your broker on a bid, you can get it in as quickly as possible.

3. Don't get emotionally attached to a property until after the home inspection is done and the financing is approved.

Inventory is low and days on market is declining with each report. Foreclosure sales continue to decline every single month. Investors do not make up the majority of buyers. Properties that are priced right are moving sometimes in a day or two. Folks with impeccable credit are being scrutinized like never before. You need to have all your ducks in a row.

Also, thanks Bill for the update.

[majinkoola]

The Fed hinted that it might slowly pull back QE in over a year, and the 10 yr spiked 1% in a month. If they actually do pull back and stop QE, I see interest rates going way up (just going back to historical averages would be going way up) and there would be a recession. In which case, people would lose jobs, non-fixed mortgage holders would see payments skyrocket, and there would be big time foreclosures. So rising interest rates would affect the supply of homeowners by decreasing that number, and put a lot of houses on the market.

However, I think there's no way the Fed will pull back QE, especially with Bernanke's replacement Yellen having an even easier monetary policy than him, and instead inflation will be a bigger deal. So house prices may not nominally go down, but in relation to food, energy, and other consumer goods, they will go down.

[TransatPhD]

Originally Posted by aliveandwellinSA

Not sure if anyone follows all of the new listings in the valley, but has anyone else noticed that the majority of new listings are older and sort of undesirable homes?
Looks like homes people are just trying to get rid of due to the mild turn around, higher prices and shortage of inventory.

Agreed. It is looking GRIM lately on the ARMLS. Against all odds, it seems like there *are* houses in the Valley that flippers haven't touched.

[Zippyman]

Originally Posted by aliveandwellinSA

Not sure if anyone follows all of the new listings in the valley, but has anyone else noticed that the majority of new listings are older and sort of undesirable homes?
Looks like homes people are just trying to get rid of due to the mild turn around, higher prices and shortage of inventory.

Noticed that too.. it's a great time to sell that 6 bedroom, one bath home (garage / patio converted into living space)..