Where are the new foreclosures?? (Phoenix: house, zip code, price)
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The bottom line is how many properties are selling and how many are coming on the market. The answer is currently there are more pending foreclosures coming than are selling (even at the selling rate) and we have more rounds of foreclosures to go. I'm going to comfortably bet that I am right. But anything is possible. The forecasts call for another 20% price erosion. They are not calling for those "seminar people" gobbling up the inventory. You know that the probability of homes going up is wishful thinking. I personally hope for all of our sake it stabilizes and goes up. The sooner the better.
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I think your logic is not reality. It may look that way from a distance but ask any agent out there and they will tell you that in most areas prices have floored. There will no doubt be price erosion in some of the higher end $200k + price points but sub $100k homes are declining. It is also not true that more homes are hitting the market than being sold. I track this every day and its not the case. Its looking like Jan and Feb were the bottom and a floor was established. I know many investors and nobody is getting homes for much less than offer price anymore. Obviously this can all change once banks begin to release a flood of additional foreclosures but right now thats anyones guess. I think its great how all these people like to sit on the sidelines and wait for prices to fall further and end up missing the boat.
I think your logic is not reality. It may look that way from a distance but ask any agent out there and they will tell you that in most areas prices have floored. There will no doubt be price erosion in some of the higher end $200k + price points but sub $100k homes are declining. It is also not true that more homes are hitting the market than being sold. I track this every day and its not the case. Its looking like Jan and Feb were the bottom and a floor was established. I know many investors and nobody is getting homes for much less than offer price anymore. Obviously this can all change once banks begin to release a flood of additional foreclosures but right now thats anyones guess. I think its great how all these people like to sit on the sidelines and wait for prices to fall further and end up missing the boat.
sfcgee. I said pending foreclosures. I know that there has been a stall on released foreclosures which has tightened the supply (hence the name of this thread ). There are different markets within the housing sector. Some areas probably have a bit more to go while others are probably close or at bottom. No one can time the bottom other than by luck. My crystal ball which is no more accurate than Captain Bill's is looking at the product that is probably about to be released as well as the time of year and the wild card of the stock market, unemployment, and other bad news that can make wallets close tight and fast! There are a lot of foreclosures that are coming down the pipeline. It's why some "experts" are predicting another 20% in depreciation.
I was specifically taking about the $200K, 3000 sq foot, 10,000 sq foot lot newer construction market. The stuff that I am wanting to buy. Captain Bill suggests I might not find what I want in 3 months. It depends on what agents you talk with and what their motivation are. You might get a different answer over a beer. A few weeks of increased sales does not make a trend. I really do hope I am wrong. I can afford it if it goes up $30K. I'll pick it up $$'s on my other sale that I have listed. Unfortunately, I don't think I am wrong. One of us are right and one of us is wrong... We shall see in late June when the summer hits. I predict that I don't have to jump. I know my agent wishes I would feel the sense of urgency. I'm listening to logic, not emotion.
Why do you "think its great how all these people like to sit on the sidelines...."??? I'm sitting on the side lines because I don't have cash right now as I have a pending sale. Personally, I don't feel the sense of urgency. This is a multi month problem and if you buy into "missing the boat" in three months you are not studying the market close enough. There is plenty of bad news to offset the good news. If I haven't stressed it enough, I'd rather have this market heal and go up than continue to go down. There is some deep economic risks for all of us outside the housing market of this continuing to slide. But I'm doing my due diligence and taking more data points than listening to agents. Your mileage may vary. One thing is for sure, this economy changes much faster in the past year than I have seen in my entire life. As I said before, I'll find my home at or below my price in a few months. I am not feeling the sense of urgency.
Last edited by MN-Born-n-Raised; 04-20-2009 at 07:56 PM..
sfcgee. I said pending foreclosures. I know that there has been a stall on released foreclosures which has tightened the supply (hence the name of this thread ). There are different markets within the housing sector. Some areas probably have a bit more to go while others are probably close or at bottom. No one can time the bottom other than by luck. My crystal ball which is no more accurate than Captain Bill's is looking at the product that is probably about to be released as well as the time of year and the wild card of the stock market, unemployment, and other bad news that can make wallets close tight and fast! There are a lot of foreclosures that are coming down the pipeline. It's why some "experts" are predicting another 20% in depreciation.
I was specifically taking about the $200K, 3000 sq foot, 10,000 sq foot lot newer construction market. The stuff that I am wanting to buy. Captain Bill suggests I might not find what I want in 3 months. It depends on what agents you talk with and what their motivation are. You might get a different answer over a beer. A few weeks of increased sales does not make a trend. I really do hope I am wrong. I can afford it if it goes up $30K. I'll pick it up $$'s on my other sale that I have listed. Unfortunately, I don't think I am wrong. One of us are right and one of us is wrong... We shall see in late June when the summer hits. I predict that I don't have to jump. I know my agent wishes I would feel the sense of urgency. I'm listening to logic, not emotion.
Well, if your prediction comes to pass and you get that 3000 sf house for 50 bucks a foot, you have to ask yourself do you really want to live in the neighborhood that will shortly come about at those prices? When prices fall to that level, the speculators will be grabbing up and renting, the first time buyers who really can't afford a home will come in along with those who can who can. The "good people" will then flee with the first rise in income and equity and you will be left in a decaying neighborhood rented to multiple families of illegal aliens, chop shops, drop houses, meth cookers and other types who really should be in a studio along the freeway. Cheap housing means cheap people. That's why the "good" areas cost more. Today's bargain may well be tomorrow's nightmare.
Well, if your prediction comes to pass and you get that 3000 sf house for 50 bucks a foot, you have to ask yourself do you really want to live in the neighborhood that will shortly come about at those prices? When prices fall to that level, the speculators will be grabbing up and renting, the first time buyers who really can't afford a home will come in along with those who can who can. The "good people" will then flee with the first rise in income and equity and you will be left in a decaying neighborhood rented to multiple families of illegal aliens, chop shops, drop houses, meth cookers and other types who really should be in a studio along the freeway. Cheap housing means cheap people. That's why the "good" areas cost more. Today's bargain may well be tomorrow's nightmare.
Your division is off. $220,000 (with a pool) / 3000 ==$73 per foot. Without the pool is $67 a foot.
Give me some credit. I certainly will make sure that the neighborhood that I'm looking to buy into isn't 30% rentals along with 20% 1st time buyers. Therefore I've removed areas of Surprise, all of El Mirage as well as many other spots. I'll be checking on pre-foreclosures as well before I pull the trigger. One key reason why I am sitting on the side lines as much as anything else is that I want to know how my pending neighborhood will take shape! If the market isn't finished depreciating, I don't want to overpay and MORE importantly, I don't want to buy in a neighborhood that had a lot of turnover.
This isn't the 1st home I have bought. I like to think of myself as savvy and street smart. Most people are hassle adverse. They might be able to replace the carpet but having the fireplace removed AND replacing the carpet throws them over the edge and a home may sit. God forbid if there are three things to do. In the "good" market", I bought 15 lake homes like this and spun them after changing the decore, the color of the house, new shingles etc. This situation is a little different. If the banks contracted out the work, they could command more $$'s, but guess what, many of them are also hassle adverse but the smart banks are getting them ready to sell. I'm completely fine with having a couple of things wrong with it for $5K-$10K in fix-up fees. That's how you buy under the market in the better areas.
As I explained earlier, I'm looking for an over priced bank home that missed the sense of urgency (mutiple bids) that are now going below market in a strong neighborhood OR a home that is under priced because people are hassle adverse. I'm not stupid enough to pre-buy nor and I going to buy in an area where there was massive turnover. I'll leave that up to the 200 "investors" that Bill was talking about.
To your other point.
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Originally Posted by Ponderosa
That's why the "good" areas cost more. Today's bargain may well be tomorrow's nightmare.
The "good areas" cost more because the buyers who overpaid had deeper pockets. When that $420K home turns into a $200K home (the stuff that I am looking at), people will not want to buy a $600K home with 1000 sq foot more. Hence, those prices will also fall and they have. But those owners have more dollars in the bank to outlast the bad economy. A lot of those banking accounts have been drained and you are seeing corrections in those neighborhoods as well. Some then will see that they are upside down and let the home go because they can. It seems we are in the middle of that correction. I'll say this. There is no safe market that experienced massive price increases. That included the entire Phoenix market.
Your division is off. $220,000 (with a pool) / 3000 ==$73 per foot. Without the pool is $67 a foot.
Give me some credit. I certainly will make sure that the neighborhood that I'm looking to buy into isn't 30% rentals along with 20% 1st time buyers. Therefore I've removed areas of Surprise, all of El Mirage as well as many other spots. I'll be checking on pre-foreclosures as well before I pull the trigger. One key reason why I am sitting on the side lines as much as anything else is that I want to know how my pending neighborhood will take shape! If the market isn't finished depreciating, I don't want to overpay and MORE importantly, I don't want to buy in a neighborhood that had a lot of turnover.
This isn't the 1st home I have bought. I like to think of myself as savvy and street smart. Most people are hassle adverse. They might be able to replace the carpet but having the fireplace removed AND replacing the carpet throws them over the edge and a home may sit. God forbid if there are three things to do. In the "good" market", I bought 15 lake homes like this and spun them after changing the decore, the color of the house, new shingles etc. This situation is a little different. If the banks contracted out the work, they could command more $$'s, but guess what, many of them are also hassle adverse but the smart banks are getting them ready to sell. I'm completely fine with having a couple of things wrong with it for $5K-$10K in fix-up fees. That's how you buy under the market in the better areas.
As I explained earlier, I'm looking for an over priced bank home that missed the sense of urgency (mutiple bids) that are now going below market in a strong neighborhood OR a home that is under priced because people are hassle adverse. I'm not stupid enough to pre-buy nor and I going to buy in an area where there was massive turnover. I'll leave that up to the 200 "investors" that Bill was talking about.
To your other point.
The "good areas" cost more because the buyers who overpaid had deeper pockets. When that $420K home turns into a $200K home (the stuff that I am looking at), people will not want to buy a $600K home with 1000 sq foot more. Hence, those prices will also fall and they have. But those owners have more dollars in the bank to outlast the bad economy. A lot of those banking accounts have been drained and you are seeing corrections in those neighborhoods as well. Some then will see that they are upside down and let the home go because they can. It seems we are in the middle of that correction. I'll say this. There is no safe market that experienced massive price increases. That included the entire Phoenix market.
I think you mean hassle "averse" not "adverse". You should probably add Goodyear to your do-not-buy list of cities. I had high hopes for Goodyear, but the housing price collapse will, I fear, render much of the area north of Yuma and south of I-10 as a blighted area of lower income and educational attainment. My recent trips to the Target store suggest a demographic shift is well underway. On the other hand, most of Goodyear's land area is south of the Gila and is yet to be developed.
BTW: My "division" was based on your prediction of another 20% drop in home prices.
Last edited by Ponderosa; 04-21-2009 at 07:49 AM..
Well, if your prediction comes to pass and you get that 3000 sf house for 50 bucks a foot, you have to ask yourself do you really want to live in the neighborhood that will shortly come about at those prices? When prices fall to that level, the speculators will be grabbing up and renting, the first time buyers who really can't afford a home will come in along with those who can who can. The "good people" will then flee with the first rise in income and equity and you will be left in a decaying neighborhood rented to multiple families of illegal aliens, chop shops, drop houses, meth cookers and other types who really should be in a studio along the freeway. Cheap housing means cheap people. That's why the "good" areas cost more. Today's bargain may well be tomorrow's nightmare.
That's what I hear is happening in Maricopa -- cheap buys and cheap rentals are changing the demographics there, and not for the better.
I think you mean hassle "averse" not "adverse". You should probably add Goodyear to your do-not-buy list of cities. I had high hopes for Goodyear, but the housing price collapse will, I fear, render much of the area north of Yuma and south of I-10 as a blighted area of lower income and educational attainment. My recent trips to the Target store suggest a demographic shift is well underway. On the other hand, most of Goodyear's land area is south of the Gila and is yet to be developed.
BTW: My "division" was based on your prediction of another 20% drop in home prices.
Thanks for the clarification on all fronts. Note to self: averse on adverse.
In Goodyear, I'm looking North of I-10. Additionally, I really like Litchfield Park. It's another $20Kish and probably worth it. It will be sad for everyone in Goodyear if nice neighborhoods turn for the worse. I think what might be key is to focus on areas and pricing where there isn't a positive cash flow for potential renters.
I'll be watching from the side lines until I see that most of this shakes out. If I have to pay more because I missed the "bottom", I will sleep like a baby.
I do hear what you are saying Ponderosa and I am picking my area with your points in mind.
quote=MN-Born-n-Raised;8434378It's spring time and its the peak selling season. The demand is of course higher. Prices in some communities finally are attractive enough to make people take note and the stock market is back to the 8K range; progress.
I'm looking at the trend that started over a year ago, which shows year over year increase in sales, and declining inventory.
I really don't know what will happen tomorrow, any more than you do. We know that there is a shadow inventory, but we don't know what the banks will do with them. We don't know what the government will end up doing to work with the banks.
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There is no doubt that those 200 "investors" are studying the market. If you are at a seminar, you probably are not the brightest bulb.
If you're referring to me as "you are probably not the brightest bulb", then all I have to say is that you don't know me, and you should hold off on your insults.
A long time ago, I learned that knowledge is the way to succcess, and have studied all of my life. I began real estate investing in the 70's after taking formal college courses, and I continue studying today. I have a lot of knowledge and experience, and I know that I'll never know it all.
When I attend some seminars, such as this one, I attend to see what others are doing, so that I can learn more. I also obtain names for my data base.
I give all of those people, whether they are new investors, or speculators, a lot of credit for being willing to attend seminars to further their investing education.
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I'd bet 95% are wannabees because 1st you need the money and next writing out that check is a whole lot harder than most people can stomach.
You should not pre-judge people that you don't know. You have no idea how much money any of them have. Also, one does not have to pay cash to buy property.
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I bet you must talk with a lot of tire kickers day in and day out and one out of ten are real buyers.
Not correct. As a Realtor, I only work with buyers who are seriously looking to buy a home now. And I choose to only work with a limited few because I don't have the time.
As an investor, most of the people who contact me about a property I have to sell are serious about buying.
I have a buyers list, and send out an email about a property and if one is interested, they contact me; if there is no interest, they don't contact me. it's pretty simple.
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The bottom line is how many properties are selling and how many are coming on the market
Don't overlook the available statistics that show what is happening in the market.
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I'm going to comfortably bet that I am right. But anything is possible. The forecasts call for another 20% price erosion.
Will you post the link to that forecast. We do know the market is still declining, and we also know that the supply has declined to 3 to 6 months in much of the valley in the lower price ranges. We also know that the prices in QC have leveled off the past month after reaching a 3 month supply.
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I see 4 properties that will work for me just in Goodyear alone. Some have been on the market for 180+ days. If I add $15K ($215K asking) I have even more to chose from. I would not be offering asking.
Using the criteria that you listed, there is one property matching that criteria in Goodyear. Five in Buckeye and five in Surprise. If you change the criteria, then it will get a different number.
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There doesn't seem to be multiple offers on several that are currently on the market. You know people buy off of sense of urgency; manufactured or real. A property that is priced too high initially will actually sell below what they could have gotten if it was priced right initially. You know that.
I think the average retail buyer buys on emotion, not urgency.
A rehabber looks for the properties that need a lot of work that the regular buyer won't touch.
All I'm saying is that as the supply declines, the choices are lowered because every buyer is going to pick the best of the bunch.
When a criteria shows 23 listings in the entire valley, there is not a lot to choose from; so the criteria must be adjusted, or wait and hope for prices to decline further.
If you are an investor and know how to rehab properties and to purchase them, it should not matter what the market is doing. You just need to know what you're doing. An experienced investor can adjust in order to profit in any market.
I'm not trying to play one-upmanship with you. I'm only stating what I know as facts from statistics and from being in the field each day, and my personal opinion.
That should bring about intelligent discussion so we can all learn from each other. The insults like "you are probably not the brightest bulb", are inappropriate.
Captain Bill. I didn't realize you attended the seminar. I was not referring to you in my dig. It's obvious that you understand your industry. Sometimes I get the feeling that you have your sales hat on but that is a different topic.
Seminars on investing in real estate reminds me of those late night paid advertising where people hawk their books on real estate. When you referred them in an earlier post as unsophisticated buyers, I would say that as an under statement.
In fact, I think you are pretty smart to attend. You might pick up a piece of info but more importantly you can hand out your business card to some of the 200 fresh faces if the opportunity arises. Perfect! It's kind of like posting on this forum... I'm not throwing stones; I do the same thing in my industry on these forums. I pick up some business and learn a thing or two along the way. But I do try to be less transparent.
We have to agree to disagree on the rest. When I read your text I can not get over the fact that I cryptically see a different agenda. I might be dead wrong and I really don't care because I see it the way I see it. Frankly, It's not worth our bandwidth to debate each individual point.
Is anyone tracking far north Phoenix (zip code 85085) in particular?
My wife and I have our eye on that part of town once we sell out house in Texas next month.
I'm seeing a lot of 3,000+ sq ft houses listed from around $260k. It seems I'm seeing more houses in the past week being listed in the $265k range which is right in the sweet spot of our price range.
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I know that there has been a stall on released foreclosures which has tightened the supply (hence the name of this thread ). There are different markets within the housing sector. Some areas probably have a bit more to go while others are probably close or at bottom. No one can time the bottom other than by luck. My crystal ball which is no more accurate than Captain Bill's is looking at the product that is probably about to be released as well as the time of year and the wild card of the stock market, unemployment, and other bad news that can make wallets close tight and fast! There are a lot of foreclosures that are coming down the pipeline.
It's why some "experts" are predicting another 20% in depreciation. 
A few weeks of increased sales does not make a trend. I really do hope I am wrong. I can afford it if it goes up $30K. I'll pick it up $$'s on my other sale that I have listed. 
We shall see in late June when the summer hits. I predict that I don't have to jump. I know my agent wishes I would feel the sense of urgency. I'm listening to logic, not emotion. 
Your mileage may vary. One thing is for sure, this economy changes much faster in the past year than I have seen in my entire life. As I said before, I'll find my home at or below my price in a few months. I am not feeling the sense of urgency.
In the "good" market", I bought 15 lake homes like this and spun them after changing the decore, the color of the house, new shingles etc. This situation is a little different. If the banks contracted out the work, they could command more $$'s, but guess what, many of them are also hassle adverse but the smart banks are getting them ready to sell. I'm completely fine with having a couple of things wrong with it for $5K-$10K in fix-up fees. That's how you buy under the market in the better areas.
