Will Scottsdale home prices hold? (Phoenix, Paradise Valley: for sale, real estate market, foreclosed)

[movin'on]

I just reviewed that Fortune article outlining the 25 areas that are going to take a real hit in the real estate market.

For those familiar with Phoenix metro area, any thoughts on N. Scottsdale? I have one of those big half acre lots, which is hard to come by in Scottsdale, so I'm thinking that's a plus.

I'm also thinking I should get out soon and put the money somewhere else (would love to by in the East Bay in Ca, as those prices are forecasted to go down 31% in the next five years). Even if I don't buy, I still want to get out while the getting out is good. I know it's all about timing. I bought a house in the Bay Area in 99 at the same price the seller paid in 90, so that's something to aim for.

Thoughts on selling in N. Scottsdale? Thanks.

[Captain Bill]

Originally Posted by movin'on

I just reviewed that Fortune article outlining the 25 areas that are going to take a real hit in the real estate market.

For those familiar with Phoenix metro area, any thoughts on N. Scottsdale? I have one of those big half acre lots, which is hard to come by in Scottsdale, so I'm thinking that's a plus.

I'm also thinking I should get out soon and put the money somewhere else (would love to by in the East Bay in Ca, as those prices are forecasted to go down 31% in the next five years). Even if I don't buy, I still want to get out while the getting out is good. I know it's all about timing. I bought a house in the Bay Area in 99 at the same price the seller paid in 90, so that's something to aim for.

Thoughts on selling in N. Scottsdale? Thanks.

I read that article and the prediction that was made for the east bay is virtually impossible to make.

The east bay is a very large area with very different demographics. There are some very bad gang and drug infested areas, some nice areas, some middle class, some upper middle class areas and some very high end areas. It's sheer folly and irresponsible for a writer to attempt to predict the future in the manner that article did.

If someone has a proven formula that can, with any reasonable accuracy, predict that such a wide demographic area as the east bay area will decline by 31% in 5 years, they could sell that formula for millions of dollars today. Probably Donald Trump would be willing to buy it.

No one can predict what a real estate, or a stock market will do in 5 years. What information can that writer possibly have that all of the people who make their living in real estate, in studying real estate statistics, history and economics day in and day out, know that these other people don't know?

In my opinion - and I don't have the same crystal ball that the Fortune writer has - N Scottsdale will always be a desirable area. It carries a prestige address and people will always want to live there because of the prestige address and because of the uniqueness of the area. People will keep moving into the Metropolitan area, at a ratio that I've read to be about 2 in and 1 out.

The high end homes are usually not affected by the sub prime market. People buying there can afford to buy there in most cases. The softness in the market in that area, in my opinion, is just because of the high inventory that has to be worked down. We don't know how long that will take. We do know there is a pent up demand for houses and we know that people have been frightened by articles such as this one. Others are trying to time the bottom.

Everyone has to make their own decision as to when to sell and when to buy.

My advice is to examine these media articles very carefully and challenge what they say. Ask how they can make that kind of prediction? What information did they use to make such a dire specific 31% prediction in a such a large diverse area?

If what they say seems unreasonable, then it probably is.

Bill

[SOON2BNSURPRISE]

The high end homes are usually not affected by the sub prime market. People buying there can afford to buy there in most cases. The softness in the market in that area, in my opinion, is just because of the high inventory that has to be worked down. We don't know how long that will take. We do know there is a pent up demand for houses and we know that people have been frightened by articles such as this one. Others are trying to time the bottom.

I agree with you there. That advice is true most places that have high end homes. Where I live upscale places from Malibu to Santa Barbara seem to retain there value when they are in the upper price ranges. I think that the reason is that 95% of the people are not going to buy there. A select few will be in that market. In addition I know of many that have paid cash for those multi million dollar homes. They want a certain neighborhood and lifestyle and they pay for it. The rest of us are not in the same ballpark as them. I would tend to say the same about Scotsdale. It is considered an upscale area. You will always have interest in the area because of what it has to offer. Good times may come and go, but the true wealth holders seem to retain there wealth in good or bad times. Same about there homes. At the same time I haven't seen too many crystal balls out there that have offered 100% truth. Some of the time they will get it right. Some of the time they will get it wrong and the slim margin will hit a home run every time.

[movin'on]

Originally Posted by Captain Bill

I read that article and the prediction that was made for the east bay is virtually impossible to make.

The east bay is a very large area with very different demographics. There are some very bad gang and drug infested areas, some nice areas, some middle class, some upper middle class areas and some very high end areas. It's sheer folly and irresponsible for a writer to attempt to predict the future in the manner that article did.

If someone has a proven formula that can, with any reasonable accuracy, predict that such a wide demographic area as the east bay area will decline by 31% in 5 years, they could sell that formula for millions of dollars today. Probably Donald Trump would be willing to buy it.

No one can predict what a real estate, or a stock market will do in 5 years. What information can that writer possibly have that all of the people who make their living in real estate, in studying real estate statistics, history and economics day in and day out, know that these other people don't know?

In my opinion - and I don't have the same crystal ball that the Fortune writer has - N Scottsdale will always be a desirable area. It carries a prestige address and people will always want to live there because of the prestige address and because of the uniqueness of the area. People will keep moving into the Metropolitan area, at a ratio that I've read to be about 2 in and 1 out.

The high end homes are usually not affected by the sub prime market. People buying there can afford to buy there in most cases. The softness in the market in that area, in my opinion, is just because of the high inventory that has to be worked down. We don't know how long that will take. We do know there is a pent up demand for houses and we know that people have been frightened by articles such as this one. Others are trying to time the bottom.

Everyone has to make their own decision as to when to sell and when to buy.

My advice is to examine these media articles very carefully and challenge what they say. Ask how they can make that kind of prediction? What information did they use to make such a dire specific 31% prediction in a such a large diverse area?

If what they say seems unreasonable, then it probably is.

Bill

Maybe 31% is hard to call. My guess is they looked at historical trends for the area. Yes, the East Bay is extremely diverse, yet I bought my house in 99 at the same price as in 90, so things do tend to take a wide swing there, more so than in other parts of the country.

I would not be at all surprised to see a 25% depreciation in housing prices in the Phoenix metro area. Some areas will be hit harder than others.

At any rate, thanks for your reply.

[GT350]

Just look at the sales in your neighborhood and surrounding areas if there are any at all. If your neighborhood is loaded with homes for sale, someone is going to drop their price because they NEED to sell and then the ball keeps rolling down hill.
Your lot is nice but not the choice or most.
Most in N. Scottsdale that want big lots also want horse privilages. If you're in a standard subdivision and have a lot that size...keep in mind it's all the more work to keep up. It looks nice but sometimes it's not practical. And in most cases you're only $2/psf worth more then those with smaller lots.

[movin'on]

Originally Posted by GT350

Just look at the sales in your neighborhood and surrounding areas if there are any at all. If your neighborhood is loaded with homes for sale, someone is going to drop their price because they NEED to sell and then the ball keeps rolling down hill.
Your lot is nice but not the choice or most.
Most in N. Scottsdale that want big lots also want horse privilages. If you're in a standard subdivision and have a lot that size...keep in mind it's all the more work to keep up. It looks nice but sometimes it's not practical. And in most cases you're only $2/psf worth more then those with smaller lots.

Well, I guess it's good I live in a horse neighborhood, not that I could see any in my yard. And yes, it's hard to keep up, but worth it, IMHO.

[GirlinAZ]

Originally Posted by movin'on

I just reviewed that Fortune article outlining the 25 areas that are going to take a real hit in the real estate market.

For those familiar with Phoenix metro area, any thoughts on N. Scottsdale? I have one of those big half acre lots, which is hard to come by in Scottsdale, so I'm thinking that's a plus.

I'm also thinking I should get out soon and put the money somewhere else (would love to by in the East Bay in Ca, as those prices are forecasted to go down 31% in the next five years). Even if I don't buy, I still want to get out while the getting out is good. I know it's all about timing. I bought a house in the Bay Area in 99 at the same price the seller paid in 90, so that's something to aim for.

Thoughts on selling in N. Scottsdale? Thanks.

I can not give you advise about California, but you need to ask yourself, what are you using this land for? Are you using this as an investment? If you do not need the money, I would hold onto it. My feelings are (I am VERY intuitive and that is all I have got to give you as to why) the market will go lower--for several years. However, North Scottsdale and a half acre??? That will be gold down the road. It really will be. I do feel very strongly that way down the road, that lot will be your retirement (depending of course how old you are). Just one person's thoughts. North Scottsdale is the one place in town that is highly desireable and new. In another decade or two, it will be worth it to hold onto it, if you can afford to. If not, then obviously do what you need to.
Hope you make money either way.

[RetiredCop]

"The high end homes are usually not affected by the sub prime market. People buying there can afford to buy there in most cases."

These high end homes are affected by the sub prime debacle. As a matter of fact many people did buy homes they could not afford because of the various teaser rates they were being offered. Yes, N. Scottsdale is a great area to call home. I have also been shopping for a home over the past 7 months in the 85254/85260 zip code. Although, I have been focusing my attention on condos, I have watched prices drop by thousands of dollars. One example I use often is the fact that about 5 months ago I was going to buy a home that was listed at 313000K...the home was priced fairly at the time. Today that same home is on the market for 265000K and the owner is negotiable. With short sale and foreclosed properties being sold every day they are sure to reduce the comp value of other homes. It is absolutley amazing at the number of homes that are for sale in Scottsdale right now. It is a matter of supply and demand...and right now supply is ahead by the tune of about a 15 month surplus in the Phoenix metro area. There is no sure fire way to predict how much a home will appreciate/depreciate in value over the next few months/years. Although, with all the economic data being released daily, I am willing to wait it out another six months with confidence that there will be further depreciation in prices in Scottsdale.

[LadmoFan]

How I wish my dad bought property in Paradise Valley. He was a military vet and could have bought real estate for about a $1 an acre or something like that. He didn't have the money with a wife and two young kids. (I was one of those kids).

I do believe Scottsdale will continue to hold it's real estate value as it is a preferred address or location. If you can afford to hold onto the property, I would, as I suspect your property will retain if not gain value. Of course I do not have a crystal ball so any of the above could be wrong...

MA

[GT350]

Originally Posted by LadmoFan

How I wish my dad bought property in Paradise Valley. He was a military vet and could have bought real estate for about a $1 an acre or something like that. He didn't have the money with a wife and two young kids. (I was one of those kids).



MA

Yeah....and minimum wage was probably $.10/hr back then too... it's all relevent...