Housing Price Drop? (Phoenix, Scottsdale, Queen Creek: real estate, houses, neighborhoods)

[BSL63087]

It seems like all I hear about these days is people wanting out of Arizona and PHX. I am one who wants in, and while I can understand why some don't like it, I do. In my time in the PHX area, I loved it. Of any city I have been to, I would want to live there the most. I can deal with the heat and I honestly don't care much about whether or not it is a "real city".

Anyways, my question is, does anyone see a huge housing price drop in the near future (2-5 years?) It seems if people who are serious about wanting to get out and do eventually move somewhere else that the housing market would drop like a ton of bricks if there aren't an equal number of people wanting to move in. I don't know much about the housing market in PHX other than it experienced a HUGE appreciation rate over the past 5 or so years. I would imagine it would eventually drop back down but I could be wrong.

[SpeedyAZ]

Phoenix hasn't had the bottom fall out like many other markets and probably won't. Yes you will see a decrease in prices but not to the extent of places like L.A. I don't predict a large price drop anywhere in the near future.

[Ponderosa]

Originally Posted by BSL63087

It seems like all I hear about these days is people wanting out of Arizona and PHX. I am one who wants in, and while I can understand why some don't like it, I do. In my time in the PHX area, I loved it. Of any city I have been to, I would want to live there the most. I can deal with the heat and I honestly don't care much about whether or not it is a "real city".

Anyways, my question is, does anyone see a huge housing price drop in the near future (2-5 years?) It seems if people who are serious about wanting to get out and do eventually move somewhere else that the housing market would drop like a ton of bricks if there aren't an equal number of people wanting to move in. I don't know much about the housing market in PHX other than it experienced a HUGE appreciation rate over the past 5 or so years. I would imagine it would eventually drop back down but I could be wrong.

Don't let a few posts on the forum fool you, AZ is the fastest growing state in the US in latest census report. Phoenix area grows by thousands a month. For every two that leave, three move in. Phoenix economy is red hot with strong job creation. Home prices have gone down a little from the peak in some areas, others are up. No one expects the housing slump to last very long. I've noticed that the developers are back at it with the heavy equipment again in subdivisions that have been idle for many months. And there is a constant parade of truss trucks, cement mixers, and belly-dumpers down the road to where I live.

[Boatdrinks]

Originally Posted by Ponderosa

Don't let a few posts on the forum fool you, AZ is the fastest growing state in the US in latest census report. Phoenix area grows by thousands a month. For every two that leave, three move in. Phoenix economy is red hot with strong job creation. Home prices have gone down a little from the peak in some areas, others are up. No one expects the housing slump to last very long. I've noticed that the developers are back at it with the heavy equipment again in subdivisions that have been idle for many months. And there is a constant parade of truss trucks, cement mixers, and belly-dumpers down the road to where I live.

Ditto - the developers are going strong in our neck of the woods too....back to charging lot premiums and everything. Resales aren't going as quickly as before, but I think that's due in large part to people overpricing their homes, as well as people trying to cash out so the supply is high.

I think, with the recent rating as one of the top (if not, the top - can't remember) places to work, Phoenix will only increase in size and the need for houses will continue to increase. And just think of all the people who'll be here next year for the Super Bowl and will decide they want to move here b/c it's such a cool place

[mhouse2001]

Phoenix's affordability is not good right now. Businesses wanting to relocate to Arizona are reconsidering because of the price of housing. Just because there are thousands moving here does NOT translate into housing appreciation. Phoenix's housing prices have been historically quite stagnant BECAUSE of the growth. Supply always met demand because there was always another acre of farmland to transform into housing. There was no incentive for prices to increase like California, where buildable land is increasingly scarce. There was no possibility of a lack of supply to drive up prices.

Phoenix's recent doubling of housing prices was an anomaly that developed from get-rich-quick investors that skewed the market in large numbers. With our pitiful economy since 2001, the only place for investors has been real estate and Phoenix was ripe to be, er, raped, for lack of a better word. Pay rates did not go up to match the cost of housing and there's no incentive in this business-friendly state to do anything to benefit consumers/homeowners. Large companies are sure not going to start giving pay raises to people so they can live here. Prices will NOT go up for several years, though growth and construction might rebound to prior levels. There is no reason whatsoever for prices to increase in any large US market in my opinion. The middle class is on life support, so who's going to buy all these houses, the wealthy? One article I read from mid-2006 said not to look for appreciation in Phoenix until 2013. By then, I don't think the US will be around, but..that's another thread altogether!

[ajgranda]

I've been looking at N Scottsdale prices the past 8 months. They seem to have dropped so very slightly. Maybe 3-4%, but that's about it.

[sablebaby]

Nope, I do not feel the prices are going to continue to decrease. I think it will level off and appreciate like it used to each year. If it increases a lot again, I'd be surprised, but happy. Like the rest have said, we have experienced the most growth out of every state, so we aren't going anywhere but up!

[mhouse2001]

Why do you believe that population growth translates into price escalation? How does this make sense? Using this theory, then Phoenix and Las Vegas would have the most expensive houses in the country.

San Francisco has no growth in its housing stock and its prices are the highest. Why? Because in SF, demand is high while supply remains stagnant--it's a peninsula with no possibility of future construction (except infill). If you want to live there, you have no choice but to pay the high price. In Phoenix, there will be NO end to the amount of homes built so there's no incentive for prices to go up. Simple economics. The recent run-up was a pure fluke, the result of rabid investment by outsiders who lacked anything else to invest in.

When you say that it will level off and appreciate like it used to, that 'used to' rate was usually equal to inflation. Housing appreciation in Phoenix was never good historically speaking and compared to other Sun Belt areas, especially California.

Price appreciation as a function of growth is not rational thinking and it doesn't fit economic theory.

[la quinta family]

Well, Queen Creek overbuilt and had alot of speculators and now
everyone is trying to sell and the housing prices have and are
coming way down. That's the one area in phoenix right now
where you could really find a bargain. Sellers are getting desperate
and are trying to sell at auctions.

[sablebaby]

Originally Posted by mhouse2001

Why do you believe that population growth translates into price escalation? How does this make sense? Using this theory, then Phoenix and Las Vegas would have the most expensive houses in the country.

San Francisco has no growth in its housing stock and its prices are the highest. Why? Because in SF, demand is high while supply remains stagnant--it's a peninsula with no possibility of future construction (except infill). If you want to live there, you have no choice but to pay the high price. In Phoenix, there will be NO end to the amount of homes built so there's no incentive for prices to go up. Simple economics. The recent run-up was a pure fluke, the result of rabid investment by outsiders who lacked anything else to invest in.

When you say that it will level off and appreciate like it used to, that 'used to' rate was usually equal to inflation. Housing appreciation in Phoenix was never good historically speaking and compared to other Sun Belt areas, especially California.

Price appreciation as a function of growth is not rational thinking and it doesn't fit economic theory.

I have watched the market for a very long time- heck I'm even a realtor. Our appreciation may not be as much as CA but it was averaging more than MOST states/cities. We were at about 10% a year. People still want to move here, there is still demand for housing. I watch several neighborhoods for prices and am seeing that many are not going down, in fact, some are going up more than they were before.

You said originally that you had no idea of AZ real estate so you were coming here for info, so why the agrument? Why not learn from us who have lived here for years? I watch the market daily and I'm not seeing the prices dropping anymore. They are working their way up!