My neighbor just listed their home for $170K (Scottsdale, Casa Grande: 2010, foreclose)

[UKFSChick]

Originally Posted by azjack

If you can not afford a down payment without assistance, then you can not afford to purchase a house. It is that buy a house no matter what philosophy that helped feed the bubble and will make the bust so far-reaching.

I happen to agree with you that zero down is not a good thing for the economy, as people don't really assume any risk of loss. Being a home-owner should entail some personal responsibility. However the simple fact is that there are people who can buy today, at today's rates, and with very little savings, because of down-payment assistance. If they are buying an REO they can use their savings to fix it up a little, buy appliances and so on. Those people will not have that advantage in a year's time.

Originally Posted by azjack

These above statements are incongruous. If I "dumped at the peak," then I did the opposite of "buy high, sell low."

It does seem that way. You say sell high, but just don't buy at all, right? When would you advise it being a good time to buy? After prices have started to climb? Or do you think renting forever is the best option? If that is the case, then I guess it would be a good time to buy if you are a landlord, since there will be so many smart renters like you out there...

[azjack]

"It does seem that way. You say sell high, but just don't buy at all, right? When would you advise it being a good time to buy? After prices have started to climb? Or do you think renting forever is the best option?"

It is not complicated. Houses in Arizona are steadily dropping in value, and trying to catch a falling knife can be quite painful. And how is 2 to 3 years forever? Can I give you the date of the price bottom? Nope, but that date is clearly not August 1, 2008.

Absent the lending bubble and accompanying mania, houses in Arizona would have remained naturally cheap. There have been substantial numbers of people moving to the state, but there is also tons of land to build on. The recession will reduce jobs, income, and house prices will drop below their historical trend levels. When prices do stop dropping in a couple of years, they will not make some V-shaped turn and start shooting up. That is fiction.

"If that is the case, then I guess it would be a good time to buy if you are a landlord, since there will be so many smart renters like you out there..."

Except the landlord who buys now will soon be underwater unless he pays cash. I would never rent from an underwater landlord.

[UKFSChick]

Originally Posted by azjack

It is not complicated. Houses in Arizona are steadily dropping in value, and trying to catch a falling knife can be quite painful. And how is 2 to 3 years forever? Can I give you the date of the price bottom? Nope, but that date is clearly not August 1, 2008.

"Clearly"? I guess that is a matter of opinion.

Originally Posted by azjack

Absent the lending bubble and accompanying mania, houses in Arizona would have remained naturally cheap.

They are cheap now.

Originally Posted by azjack

When prices do stop dropping in a couple of years, they will not make some V-shaped turn and start shooting up. That is fiction.

Of course. I have never said it would. It will be flat for a while - making it a good time to buy during that time. And that time may well last several months longer - probably well into 2009.

Originally Posted by azjack

Except the landlord who buys now will soon be underwater unless he pays cash. I would never rent from an underwater landlord.

An underwater landlord (or owner-occupier for that matter) is only in trouble if s/he has an ARM and has to sell because payments become too high. Rents dropping only affect a landlord between tenants. And by your reasoning, there will be bunches of renters out there staying away from buying. Do you ask your landlord to provide a financial statement and copies of mortgage statements before you sign a contract?

I would still be interested in knowing what sign you are looking for to tell you it is a good time to buy. When prices are going back up, is that correct?

[dc1225]

Originally Posted by UKFSChick

"Clearly"? I guess that is a matter of opinion.



They are cheap now.



Of course. I have never said it would. It will be flat for a while - making it a good time to buy during that time. And that time may well last several months longer - probably well into 2009.



An underwater landlord (or owner-occupier for that matter) is only in trouble if s/he has an ARM and has to sell because payments become too high. Rents dropping only affect a landlord between tenants. And by your reasoning, there will be bunches of renters out there staying away from buying. Do you ask your landlord to provide a financial statement and copies of mortgage statements before you sign a contract?

I would still be interested in knowing what sign you are looking for to tell you it is a good time to buy. When prices are going back up, is that correct?

You know what would raise some eyebrows? if the real estate started to tank in PHX/Scottsdale/Paradise Valley area...You will def. see some major major changes and urgency then...but nobody really cares that QC's, Maricopa's, anthem's are crashing.....I know the losses are everywhere but until it starts to effect the rich and the haves, things won't change, well quite as fast anyways!

[MotleyCrew]

Originally Posted by A2M69

You know what would raise some eyebrows? if the real estate started to tank in PHX/Scottsdale/Paradise Valley area...You will def. see some major major changes and urgency then...but nobody really cares that QC's, Maricopa's, anthem's are crashing.....I know the losses are everywhere but until it starts to effect the rich and the haves, things won't change, well quite as fast anyways!

I am puzzled. What could the rich possibly do if their real estate tanked in the areas you mention? I guess they could ride out the storm better than most, but that is because they are rich. Are you saying that they have a secret weapon of some kind?

[azjack]

"Do you ask your landlord to provide a financial statement and copies of mortgage statements before you sign a contract?"

I do not need to do that. It is much simpler to check the county records online. I checked how much he paid for the house, how much he borrowed, whether he re-financed and borrowed more, and whether he had any recorded defaults. I did this before offering to rent the place in 2005, and I re-check this data every few months. So far, it all checks out.

But even without a recorded default, I would never rent from someone who owes $300K on a $150K house. The risk of his defaulting on his debt would be too high. Some people are not as careful and end up with a rental house in foreclosure.

And houses in Arizona are not cheap now. They are just not as ridiculously overpriced as two to three years ago. Don't you get it, every REO that closes guarantees even lower prices for that area? It is a race to the bottom. More REOs closing means even more underwater people. More underwater people means more walking away, which creates even more REOs. Massive deflation of house prices is the only way to "finish" this bust. And massive deflation does not mean just a 30 or 40 percent discount from the peak of a mania where liar loans were rampant and the NAR was preaching that the real estate boom will not bust.

[bonniegail]

Please advise what web address you use to check the county records online.

Thanks!

[azjack]

"Please advise what web address you use to check the county records online.
Thanks!"

Maricopa County Recorded Document Search


AND


Maricopa County Parcel Search

[markas214]

Originally Posted by UKFSChick

That's not very polite and a pretty big assumption to make about someone's ethics and personal moral code.

I agree with you here. No need for personal attacks. You are a straight shooter and are articulate in your responses. I'd hire you if I needed a realtor in Casa Grande.

[ArizonaBear]

Anymore; with all due respect to the ethical realtors out there........I trust none of them since the imploding RE market (starting 2005, the cracks were starting to appear in Bullhead City) has proven them all wrong.