need advise (Tucson, Marana, Vail: real estate, foreclosures, rent)

[Palmi]

Hi All,
I will buy a new home soon and I need some help.
For my budget, I am considering to buy a home in Marana (Continental Ranch) or in Vail.
I need some advice to make a good decision, because I am not from Tucson (I’m from South America).
I'm planning to stay in Tucson for 4 or 5 years. So my decision should considerate a good price and easily to sell in the future.

Thanks for any advice, please help me.

Palmy

[sierraAZ]

Originally Posted by Palmi

Hi All,
I will buy a new home soon and I need some help.
For my budget, I am considering to buy a home in Marana (Continental Ranch) or in Vail.
I need some advice to make a good decision, because I am not from Tucson (I’m from South America).
I'm planning to stay in Tucson for 4 or 5 years. So my decision should considerate a good price and easily to sell in the future.

Thanks for any advice, please help me.

Palmy

Within this time frame, I wouldn't buy a house in Tucson at all. In case you don't know, we had a recent boom (run up in prices) and are now in a bust (huge inventory; prices not that much lower for now, but this can change). Nobody can say what the situation is going to be in 4-5 years. You may very well lose big time.

Let's say you buy a 200K house. You're looking at 5+K closing costs + 12K commission when you sell (6%). That's 17K right off the bat. And if the house depreciates... which it very well may... you get the picture. You can happily rent and invest your money in something else.

It's your business, of course, but just my 2c.

[Bummer]

Originally Posted by Palmi

Hi All,
I will buy a new home soon and I need some help.
For my budget, I am considering to buy a home in Marana (Continental Ranch) or in Vail.
I need some advice to make a good decision, because I am not from Tucson (I’m from South America).
I'm planning to stay in Tucson for 4 or 5 years. So my decision should considerate a good price and easily to sell in the future.

Thanks for any advice, please help me.

Palmy

Interesting question, Palmi

If you are in the market for a HOME, not a "get rich quick" investment, this is a good time to buy. Definitely a Buyers Market with a huge inventory that as with any market . . . will change and improve with time.

The figures posted by SierraAZ are very valid except for one major point . . . THE TAX ADVANTAGE. So, using the posted example, if you did buy a $200k home and after five years sold it for $220 (very unlikely but definitely anything is possible) I still see it as a major positive. The ability to save considerably on your Federal and State Taxes in lieu of mere rent receipts plus a better standard of living in your own place needs to be considered. On the positive side, what happens if the market does bounce back and your home appreciates a conservative 10% per year for those five years?

Good Luck!

[sierraAZ]

Originally Posted by Bummer

Interesting question, Palmi

If you are in the market for a HOME, not a "get rich quick" investment, this is a good time to buy. Definitely a Buyers Market with a huge inventory that as with any market . . . will change and improve with time.

The figures posted by SierraAZ are very valid except for one major point . . . THE TAX ADVANTAGE. So, using the posted example, if you did buy a $200k home and after five years sold it for $220 (very unlikely but definitely anything is possible) I still see it as a major positive. The ability to save considerably on your Federal and State Taxes in lieu of mere rent receipts plus a better standard of living in your own place needs to be considered. On the positive side, what happens if the market does bounce back and your home appreciates a conservative 10% per year for those five years?

Good Luck!

Bummer, just out of curiosity... are you in the RE business by any chance? Of course, if you are in this business, you certainly know how things stand. Heck, anybody who hasn't been under a rock this year knows.

Why would a foreigner get stuck with a house in Tucson for 4-5 years in this market and in these unpredictable times? I'm in this situation right now, watch the market like a hawk, have no plans of moving and am still scared to death. Have you seen historical graphs of housing run-ups? The peak now is 3 to 4 times higher than any ever seen before. If things are to go down to any fundamentals, this could very well mean up to 50% reductions. OK, maybe Tucson is not as bad, but 20-30% is very feasible in the near future. As a matter of fact it's happening right now. I've personally seen houses sold for 20-30K less than they were bought in 2005. It'll get even better after all the foreclosures become comps. What you deduct from your taxes you pay on interest, real estate taxes, and insurance and you know it. For such period of time you can rent the same type of house and have peace of mind. The guy is a foreigner and has no clue what's going on here.

Sure, anything's possible. Somebody wins the Powerball once in a while, but what are the chances?

[BillyBaroo]

I'm buying right now, but I'm buying a house to raise my kids and grow old in. I'm not looking at it as an investment as much as I'm looking to improve our quality of life and have our own home. So I'm in a lot different position than somebody looking to sell four or five years from now. That would be a tough decision. But I will say that those two areas in Marana and Vail will experience a lot of growth over the next five to ten years. Lots of people are still moving to Arizona and I don't think it's going to stop.

[Ozark Nana]

It might actually be a good time to buy right now. There are some forclosures on the market that are going for a good price. Albeit some need work. The biggest thing I see going against a buyer right now is the fact that the County did NOTHING to reduce the property taxes when the balloon got popped! The housing costs being driven up was one thing, but now that they have started dropping and the "correction" has begun, one would hope the County would of also "corrected" the taxes....they did not. The taxes are one very real problem in purchasing a house right now, the homes still aren't worth what they are selling for and WILL come down, I don't see our property taxes following suit very quickly. You now have a home, that on the market, is not worth what is was last year, but our taxes actually went UP 10%.

O.Nana

[michael krotchie]

Originally Posted by sierraAZ

What you deduct from your taxes you pay on interest, real estate taxes, and insurance and you know it. For such period of time you can rent the same type of house and have peace of mind. The guy is a foreigner and has no clue what's going on here.

Sure, anything's possible. Somebody wins the Powerball once in a while, but what are the chances?

Interest from your mortgage payments is deductible, and in a traditional mortgage the first few years are when you pay the most interest. Property taxes are also deductible.

Palmi, as many other posters have noted it IS in fact a buyer's market right now. Prices reached their peak in 2005 and have been slowly retreating ever since. So yes, those people who purchased doing that time have probably seen a drop in the value of their home.

According to this article from CNN.com today the median prices of homes will remain steady or decline just slightly through 2008. With your 4-5 year timeframe in mind, your home value at the very least would remain steady if not rise.

The Northwest side of town currently has more homes on the market than any other area and you would definitely find a good deal if you are looking there.

[LordBalfor]

Although my opinion is of course just that (an opinion) and not worth any more than anyone else's here, I tend to agree with Bummer and Ozark Nana (as opposed to sierraAZ (with apologies)). I do think it could be a good time to buy.

Is it exactly the very best time to buy - with prices at their absolute lowest? Probably not. It might pay to hold off a bit longer - but I would be ready to buy quickly if the market shows any signs of improving. The fact is however, that timing the housing market, like timing the stock market, is REALLY tough - and to a large degree mostly luck, so chances of you timing your purchase so that you get in at the absolute bottom are pretty small. In the short run it seems like prices are still falling. How far will they fall? No one knows for sure - but consider this: as more and more baby boomers near retirement they are looking south, and the coming wave of retirees is HUGE. In the long run that can only increase demand for housing in the Tucson area. So, is that enough of an impact to stablize prices in a year or two and drive them up in five? I tend to think so.

But then again, what do I know?

Ken

[michael krotchie]

Originally Posted by LordBalfor

Is it exactly the very best time to buy - with prices at their absolute lowest? Probably not. It might pay to hold off a bit longer - but I would be ready to buy quickly if the market shows any signs of improving. The fact is however, that timing the housing market, like timing the stock market, is REALLY tough - and to a large degree mostly luck, so chances of you timing your purchase so that you get in at the absolute bottom are pretty small. In the short run it seems like prices are still falling. How far will they fall? No one knows for sure - but consider this: as more and more baby boomers near retirement they are looking south, and the coming wave of retirees is HUGE. In the long run that can only increase demand for housing in the Tucson area. So, is that enough of an impact to stablize prices in a year or two and drive them up in five? I tend to think so.

Very well put!

[Bummer]

Originally Posted by sierraAZ

Bummer, just out of curiosity... are you in the RE business by any chance? Of course, if you are in this business, you certainly know how things stand. Heck, anybody who hasn't been under a rock this year knows.

Why would a foreigner get stuck with a house in Tucson for 4-5 years in this market and in these unpredictable times? I'm in this situation right now, watch the market like a hawk, have no plans of moving and am still scared to death. Have you seen historical graphs of housing run-ups? The peak now is 3 to 4 times higher than any ever seen before. If things are to go down to any fundamentals, this could very well mean up to 50% reductions. OK, maybe Tucson is not as bad, but 20-30% is very feasible in the near future. As a matter of fact it's happening right now. I've personally seen houses sold for 20-30K less than they were bought in 2005. It'll get even better after all the foreclosures become comps. What you deduct from your taxes you pay on interest, real estate taxes, and insurance and you know it. For such period of time you can rent the same type of house and have peace of mind. The guy is a foreigner and has no clue what's going on here.

Sure, anything's possible. Somebody wins the Powerball once in a while, but what are the chances?

WOW, SierraAZ . . . lots here for me to respond.

NO, I am not "in the Real Estate Business" in any way. However, I do believe home ownership has more positives than negatives even if there is no "windfall" when time to sell. As I pointed out earlier, a break-even (extremely unlikely) would be far better and more rewarding than paying rent for five years. Many years of rent receipts are nothing but a dead end.

As for your comment . . .

I'm in this situation right now, watch the market like a hawk, have no plans of moving and am still scared to death.

Considering your situation, my recommendation would be for you to NEVER read and/or listen to any of the "doomsday" reports (correction: any reports whatsoever) which would also apply if you have money invested in the Stock Market. There is absolutely no reason for you to be "scared to death" over the current or near future value of your home if you have no plans to sell other than maybe more gray hair and loss of sleep. Enjoy your home and think positive.

Believe me . . . "SCARED TO DEATH" will not help and/or improve the situation in any way!

Now, back to the original subject . . . I still feel this is a great time to buy for the long haul but NOT for the "Fast Buck Freddys" only looking for a quick buck.

MY TWO CENTS WORTH!