Prescott Home Prices Continue to Fall (Phoenix, Scottsdale: neighborhoods, salary, living in)

[DellNec]

Originally Posted by nikorock28

The growth and expansion of Prescott is due, in part, to retirees from other locations. With the horrible economic conditions, people are working longer and putting off retirement. Also, with the crash in home prices in CA and other states, people can't just sell their homes and move to Prescott, which is what has occurred in the past. All these factors will contribute to continued decreased prices.

I remember talking to dozens of people who were moving from CA to AZ from 2003 - early 2008. They were selling their $1MIL+ SoCal home and moving into Prescott. They said that they would get more bang for buck here in Prescott vs. SoCal. They could sell a 1,800 sq.ft. home in CA for close to $1MIL and come to Prescott and buy a 2,500 sq.ft. home for $600K. They said that with the leftover money, they would invest or put it in the bank.

I would easily say that 90% of the retirees were from California, the remaining were from the Midwest, with only a handful being East Coast. They were all retired. Parts of the MidWest like Illinois, Michigan & Indiana have also taken a RE hit, but not as bad as AZ, CA and Nevada have.

With the RE collapse, Prescott was deeply affected by the above. The Prescott of today was due to the RE boom from CA. The retired people moving here from other states was probably only 10%, CA was the main one.

[DellNec]

I also remember LasVegas Ranch Estates. The first phase sold-out in record time and lots were going from $500K - $1MIL. Some people even bought the land without even looking at the lot. When the bottom fell out, the remaining phases started to stagnate. Then the foreclosures began and continue through today, as many bought the lots with a 3 or 5 year interest-only ARM w/balloon.

If they bought from 2003-2008, the 5 year loan is due from 2008-2013. If they paid $700k for the lot, it is probably worth $350K today. There is no way they would pay off the loan, they just walk away from it and the lot goes into foreclosure.

Prices have dropped 50%-65% since then. I still think they are somewhat overpriced today, but you can buy a 38 acre parcel for $350K. The problem with LVR estates is that it takes 45 minutes to get to the downtown square. Sometimes up to 60 minutes if you live on the far end of the estate or if you encounter a slow moving vehicle on WVR.

[Woof]

National unemployment may be getting worse, if the last coupla weeks were any indication. I vote for lower home prices ..... though I do tend to be overly pessimistic.

[wretched wrench]

As far as declining home prices go, has anybody use Zillow to follow their house or (better yet) several houses over the last few years?

Is Zillow reliable in predicting the selling price of a house?

[nikorock28]

Originally Posted by DellNec

I remember talking to dozens of people who were moving from CA to AZ from 2003 - early 2008. They were selling their $1MIL+ SoCal home and moving into Prescott. They said that they would get more bang for buck here in Prescott vs. SoCal. They could sell a 1,800 sq.ft. home in CA for close to $1MIL and come to Prescott and buy a 2,500 sq.ft. home for $600K. They said that with the leftover money, they would invest or put it in the bank.

I would easily say that 90% of the retirees were from California, the remaining were from the Midwest, with only a handful being East Coast. They were all retired. Parts of the MidWest like Illinois, Michigan & Indiana have also taken a RE hit, but not as bad as AZ, CA and Nevada have.

With the RE collapse, Prescott was deeply affected by the above. The Prescott of today was due to the RE boom from CA. The retired people moving here from other states was probably only 10%, CA was the main one.

Exactly. My parents moved from southern CA during the stated time period.

[Woof]

Well, that's good then. Retired people have no need to sell their homes, so any collapse won't really affect them.

[BriansPerspective]

Originally Posted by DellNec

If they bought from 2003-2008, the 5 year loan is due from 2008-2013. If they paid $700k for the lot, it is probably worth $350K today. There is no way they would pay off the loan, they just walk away from it and the lot goes into foreclosure.

Unfortunately for them, just walking away from a land parcel does not end their misery. Vacant land is not covered by the anti-deficiency laws. If you walk away from the loan, you still owe the money. Then you owe the money and you don't even own the land!

[BriansPerspective]

Originally Posted by wretched wrench

As far as declining home prices go, has anybody use Zillow to follow their house or (better yet) several houses over the last few years?

Is Zillow reliable in predicting the selling price of a house?

Zillow can be pretty accurate if you have an average house in a homogenious subdivision. If your house is unique in any way, then the zillow numbers are not accurate. If the subdivision consists of homes that vary significantly in age, upkeep, upgrades, etc., then zillow will not be accurate.

[nikorock28]

Originally Posted by BriansPerspective

Unfortunately for them, just walking away from a land parcel does not end their misery. Vacant land is not covered by the anti-deficiency laws. If you walk away from the loan, you still owe the money. Then you owe the money and you don't even own the land!

Good information! Could the loan be included in a bankruptcy?

[BriansPerspective]

Originally Posted by nikorock28

Good information! Could the loan be included in a bankruptcy?

Presumably, but you would have to talk to a bankruptcy lawyer to be sure.