Phoenix Real Estate Recovery

[yukon]

I'm curious, did the PHX real estate market have tons of apartment buildings bought out and converted to condos?

[iznhour]

Yes the Valley has had a lot of condo conversions in the past couple years, I assume like most markets around the country. Some that are selling now are in pretty difficult positions, like the rest of the housing industry, and are both selling and leasing simultaneously or have converted back to leasing entirely. I think we will begin to see flattened prices next summer, '08, and see steadily increasing prices a year after that. So true pick up summer of '09.

[sheena]

Originally Posted by yukon

I'm curious, did the PHX real estate market have tons of apartment buildings bought out and converted to condos?

Yes lots, it was funny to see a complex that was bought out on Guadalupe and Dobson during the boom. They had 2-3 bedroom apts with a sign saying from the 300's. A few months later during the bust the sign came down. I sure hope no one got burned buying one of those. That was a joke. It was actually sickening. I doubt anyone could unload one of those now for 150,000.

[dmiller01]

Florida is even worse. On CNN last week there was a story about a developer who auctioned off their unsold inventory of condos (about 8). They went for $165,000 and $145,000. Other tenants had paid around $300,000 only six months earlier. They were VERY pissed and threatening to sue, but the developer said he accepted "fair market value" for the condos, which of course made the earlier buyers even more upset.

The market will turn around, hopefully sooner than later, but it is a bit scary...

[azjack]

There were some statistics that Forbes mag published this week that I found interesting. One was that 115,000 MORE people moved to Phoenix than out of Phoenix. That represents the potential of 115,000 more homes sold (or rented).

So, babies, toddlers, and grade school kids will all be picking up a house or two?

Will married couples live separately so as to do their part to reduce Phoenix housing inventory?

A) Your number is likely inaccurate.
B) Even if it were accurate, that is not 115K households, just 115K individuals.
C) These population numbers include many illegals, who are remarkably having trouble obtaining multi-hundred thousand dollar loans. Many will hopefully leave when they are no longer employable in Arizona in January 2008.
D) Your numbers will lessen in the coming recession.
E) More people share housing during financial downturns.
F) I am tired of typing; metro Phoenix house prices are facing a bust and it can not be avoided through spin.

[topjimmy]

Never. The oil will dry up and the bottom will fall out of the stockmarket before you will ever see a real estate market like that again.

[azjack]

Do consider interest rates (if you'll be getting a loan). If interest rates go up too much, it will offset any continued price decline.

If you have a high interest rate loan, you can refinance the loan when rates are lower. If you pay too much for a house, you do no get a refund when its price deflates.

Buy later with possibly higher interest rates, but at a much lower purchase price and with a much lower loan amount.

[dmiller01]

Very good point azjack!

[MotleyCrew]

Some of the builders here in Vistancia have more than slashed their prices and are throwing in a pool on top of it. Shea has an upscale section here that started out in the $600's. The entry model is now in the $400's. Not sure what they are doing with the lot premiums or incentives, but $200K is quite a drop in my opinion. I would be buying now or at least doing some serious looking. I also received a flyer today advertising homes in Queen Creek starting in the $120's. Maricopa in the $150's. Those prices you cant find anywhere in California so I believe that it is just a matter of time and they will be coming to buy again.

[YAZ]

Good points, Cmist.....

I spilled coke laughing at the post expecting a recovery in 2009....

My crystal broke........I don't have the guts to make predictions.

Not serious ones, anyway.

My friend owns and rents his condo out that's next door to our rental. He e-mailed me yesterday stating that he's walking away from it. Another low comparable housing price in our old neighborhood that will just bring our rental property down. No way that we could sell it.

House across the street from us?

Went up for a short sale last fall for $130k. I don't know what she owed on it, obviously more than $130k.

Now listed as a foreclosure for $60k.

We are simply holding on for dear financial life.