Phoenix MLS Predicting Lowest Median September Price in Nine Years (loan, house)

[Potential_Landlord]

At my old employer in Scottsdale we were all laid of around July 2009. Of the 10 people in my time, 9 have found equal employment albeit many at slightly lower pay. One person is still out of work after a full year of unemployment. It is still pretty ugly out there. The average person was looking 6 months I would say. This is in IT. On the other hand, the people who have jobs out there feel much safer about their positions than a year ago. So they are looking to buy more now. 80%+ employed weigh more than 10-15% unemployed for the housing market.

[OnYourSide]

Originally Posted by azjack

None of those categories have stopped producing foreclosures. But we all get that, I just do not think that people grasp the massive number of foreclosures that are still in the PHX pipeline. There are also plenty of people who have become less eager to pay as their income has decreased, even if the income was not eliminated altogether.

Jobs is really going to be a key factor moving ahead. Once the government stimulus effects have dried up, we can see how much permanent movement was actually created in the economy.

[PhoenixAirConcerns]

Since the end of the tax credit, I think activity has really slowed down. I don't know what they are going to do, because if they don't bring back the tax credit, housing is going to decline hard again. If they do bring back the tax credit, then what are they going to do, permanently have it there?

I don't think they ever should have had it in the first place, because not it is an artificial necessity and housing can't survive without it.

[_Charles_]

AZ's UE rate is actually worse than reported. We have a highly transient work force even in good times. Here in the Valley there is entire class of folks who only live her for an average of about 5 years then leave and that is in good times. This subset of the workforce has been steadily leaving since the downturn hit. They have no ties here so as soon as the job goes - they go. I have heard it said that if these folks stayed around after losing their jobs - our UE stats would rival Michigan’s. Based on 25 years of living here, I believe it. And of this directly impacts home values here.

[Ritchie_az]

AZ's UE rate is actually worse than reported. We have a highly transient work force even in good times. Here in the Valley there is entire class of folks who only live her for an average of about 5 years then leave and that is in good times. This subset of the workforce has been steadily leaving since the downturn hit. They have no ties here so as soon as the job goes - they go. I have heard it said that if these folks stayed around after losing their jobs - our UE stats would rival Michigan’s. Based on 25 years of living here, I believe it. And of this directly impacts home values here.

So it would be better if the unemployed stuck around? If folks who lost their jobs found work in another state, is that not a good thing? I guess I don't get what you are trying to say....
The economy here is not great--it's in the bottom third right now--but it could be worse and I'm glad it's not worse. When the national economy begins to recover, I suspect that Arizon'a economy will grow at a pretty good pace.

[PhoenixAirConcerns]

Originally Posted by _Charles_

AZ's UE rate is actually worse than reported. We have a highly transient work force even in good times. Here in the Valley there is entire class of folks who only live her for an average of about 5 years then leave and that is in good times. This subset of the workforce has been steadily leaving since the downturn hit. They have no ties here so as soon as the job goes - they go. I have heard it said that if these folks stayed around after losing their jobs - our UE stats would rival Michigan’s. Based on 25 years of living here, I believe it. And of this directly impacts home values here.

I agree with your analysis. Much of the local economy had to do with unskilled, "go with the trend" (real estate) jobs, and as soon as it was over and the easy money went away, so went much of the means of the population. Given much of Arizona's population comes and goes anyways, there isn't really much tying anyone to stay.

[crystalys]

Originally Posted by Howard Roark

Strategic defaults are going to be looked at seriously by Fannie Mae and Freddie Mac. It does not matter whether they happen in a recourse state or non recourse state, but those institutions are going to sue the deadbeats - mostly specuvestors. The ones who lost their jobs and cannot afford the mortgage can claim economic hardship beyond their control and will not be sued. It will get ugly for the gamblers - specuvestors. And it should get ugly for them.

I'm not sure they would have the resources to do this. And if they do it to one then they would have to do it to all of them seeing as I assume they would have to treat everyone equally. Seems to me that they had a significant role in this mess in the first place by being too lenient with rules and regulations and backing loans that were set up to fail from the beginning. Besides if they do take on the enormous task of going after all strategic defaulters then they better start with big business before they work their way down to the homeowners. And the last thing law abiding, tax paying citizens need is footing the bill for such an undertaking because the money will eventually come from us one way or the other. Don't get me wrong. I think those that knew full well that they could not sustain their no money down inflated investment properties should be penalized. But again I point out that the ones loaning the money were similarly culpable. JMHO and yes I am a realtor but I have never and will never help any client get into something that they don't understand fully and can't handle financially.

[jimj]

Originally Posted by crystalys

I'm not sure they would have the resources to do this. And if they do it to one then they would have to do it to all of them seeing as I assume they would have to treat everyone equally. Seems to me that they had a significant role in this mess in the first place by being too lenient with rules and regulations and backing loans that were set up to fail from the beginning. Besides if they do take on the enormous task of going after all strategic defaulters then they better start with big business before they work their way down to the homeowners. And the last thing law abiding, tax paying citizens need is footing the bill for such an undertaking because the money will eventually come from us one way or the other. Don't get me wrong. I think those that knew full well that they could not sustain their no money down inflated investment properties should be penalized. But again I point out that the ones loaning the money were similarly culpable. JMHO and yes I am a realtor but I have never and will never help any client get into something that they don't understand fully and can't handle financially.

Do you see this behavior happening still/again? After recently looking to buy I was up against speculators/investors/flippers all over the place, was offered a zero down loan from the feds, was offered a stated income loan (at a higher rate of course) so what's changed?
Now that we've finally bought and after speaking with some of our neighbors this area (and I'd have to guess many others) are real close to a huge wave of foreclosures. What I was told after we moved in was that well over half of the people living in our sub were barely hanging on and teetering on the edge right now. If landscaping,curb view and just general neighborhood activity (or lack thereof) are any indication I can believe it.

[RattleSnake_Heads]

Originally Posted by crystalys

I'm not sure they would have the resources to do this. And if they do it to one then they would have to do it to all of them seeing as I assume they would have to treat everyone equally. Seems to me that they had a significant role in this mess in the first place by being too lenient with rules and regulations and backing loans that were set up to fail from the beginning. Besides if they do take on the enormous task of going after all strategic defaulters then they better start with big business before they work their way down to the homeowners. And the last thing law abiding, tax paying citizens need is footing the bill for such an undertaking because the money will eventually come from us one way or the other. Don't get me wrong. I think those that knew full well that they could not sustain their no money down inflated investment properties should be penalized. But again I point out that the ones loaning the money were similarly culpable. JMHO and yes I am a realtor but I have never and will never help any client get into something that they don't understand fully and can't handle financially.

I'm thinking the same thing. There is far too much talk, and to little enforcement when it comes to most government agencies. The best way to prevent tax paying citizens from being looted is prevention and tighter policies. It will bring greater health in the long run.

[Howard Roark]

I would rather have a price drop in RE prices than a standard "fits all" tax credit of $8,000. Face it, not all locations are the same. Some are overvalued and some are undervalued. The market is the judge.

Originally Posted by PhoenixAirConcerns

Since the end of the tax credit, I think activity has really slowed down. I don't know what they are going to do, because if they don't bring back the tax credit, housing is going to decline hard again. If they do bring back the tax credit, then what are they going to do, permanently have it there?

I don't think they ever should have had it in the first place, because not it is an artificial necessity and housing can't survive without it.