Phoenix Area MLS Inventory

[Captain Bill]

Originally Posted by California Yanqui

Hi Captain, I keep hearing doom and gloom from the MSM and I follow the stats and look at many different sites and it seems to me that Phoenix still has a large influx of people moving into the state. Places in the west valley are building commercial and the new housing sector is slow but steady in building homes. 9 in my area since August.

I feel with that the market is or has adjusted and that with the rates possibly going down further that this spring and summer may be the last hurray for homebuyers before we settle back down to normal appreciation rates and a balanced inventory.

Opinion?

Hello California Ayanqui, I wish I could say the market has adjusted, but we still have the inventory.

I'm hoping that the tide of foreclosures will be slowed next year with the policies that were put in place this week.

December is slow, and it traditionally is slow, but I'm seeing quite a few buyers looking in the retirement communities. Some are moving to different homes in the same area; some are relocating from other states; and some are from Canada looking to buy.

January typically picks up, so in February we should be able to get a first glance at what the new year will bring.

I know that some people have decided to take their homes off the market until it settles, and that is good. Every home removed from the inventory helps. If everyone who doesn't have to sell would remove their home from the market it would, in my opinion, help the market drastically. I believe that overpriced homes sitting on the market just hurts everyone.

From looking at the numbers and what I see on the streets, I'm thinking that it's going to be in the second half or third quarter before it starts getting back to normal.

Much will depend on interest rates remaining low; mortgages being reasonable to obtain; buyers getting their credit ratings up; and builders cutting back.

There will be a lot of growth in the west valley, and that will help. As jobs get created in some of those pockets more people will be moving into the areas.

Bill

[sierraAZ]

Originally Posted by Captain Bill

Hello California Ayanqui, I wish I could say the market has adjusted, but we still have the inventory.

There was a bit of a surprise in Tucson in November. The condos sold were about 3 times more than November 06. I don't think this data is skewed because they're not in the questionable outskirts still included in last year's reports. Wonder if it's just a fluke or a trend... How about Phoenix?

[azjack]

"From looking at the numbers and what I see on the streets, I'm thinking that it's going to be in the second half or third quarter before it starts getting back to normal."

Peak to trough will be a heck of a lot longer than 2 1/2 or 3 years.

The massive sales tax revenue drops signal to me that the housing bust has led us into a severe recession. No more housing ATM dollars, I guess.

[Captain Bill]

Originally Posted by azjack

"From looking at the numbers and what I see on the streets, I'm thinking that it's going to be in the second half or third quarter before it starts getting back to normal."

Peak to trough will be a heck of a lot longer than 2 1/2 or 3 years.

The massive sales tax revenue drops signal to me that the housing bust has led us into a severe recession. No more housing ATM dollars, I guess.

Jack, do you have a source to point us to see the sales tax revenue drops?

Are you referring to countywide or state wide?

Bill

[California Yanqui]

I just don't see it happening. A recession I mean. The way the influx of people are moving into Arizona and the rates as low as they are, and prices for housing as low as they are, it's only causing those that have put away savings enough to buy a home more incentive to come here, and buy.

I also think you'll start to see more service jobs opening up as this new law goes into effect on Jan 1st requiring proof of legitimacy in the country.

I see more California entertainment industry jobs doing productions here as well as in New Mexico because of the incentives being offered.

[azjack]

'Jack, do you have a source to point us to see the sales tax revenue drops?
Are you referring to countywide or state wide?'

Cities, counties, and the state. Actually, it is becoming a national trend.

Let's see, a couple of examples.

Down the rode from you in Tempe:

"Vice Mayor Hut Hutson warned that retail sales in Tempe aren’t just down — he said each month’s revenue has been smaller than the previous month’s.

That means even the revised surplus projection could be too optimistic, he said.

And things could get even worse, said Jerry Hart, the city’s financial services manager. He doesn’t expect an economic turnaround soon, given gloomy reports of the slumping housing market, rising gasoline prices and credit problems."

http://www.eastvalleytribune.com/story/105080


Or Mesa:

"Mesa officials are expected to release a bleak financial forecast today and suggest a list of programs and departments in which the city could make budget-saving cutbacks.

Lagging sales tax figures are forcing the city to wrestle with the issue before the midway point of the city’s 2007-08 budget year, they said.

In November, city officials forecast Mesa would be $3.8 million short of its revenue forecasts if sales tax figures continue to drag into the summer. June 30 is the end of the city’s budget year."

http://www.eastvalleytribune.com/story/104859


And you may have heard about Arizona's ONE BILLION DOLLAR budget deficit. Pardon me, $970 million. Projections up to 2 Billion for the next fiscal cycle.

I know from watching the council here in Surprise, they spent like drunken sailors during the boom years, and we have new city buildings going up left and right. Too bad that the City will not be able to afford to complete them based on their rapidly declining revenue. Well, not without tax hikes that will further slow the economy. And this is a high-growth area, so people must be spending less since they have run out of money to borrow.

Recession is already here in Arizona. (To keep on topic), MLS Inventory will probably take off again in February. Transactions will continue to be at multi-year lows.