Epicenter of Housing Crisis (Phoenix: short sale, real estate, 2013)

[BestintheWest]

Time to buy
or time to cry?
Probably depends if you want a deal, or if you want to sell,
or if you don't care
because you aren't going anywhere.

phoenix-epicenter-housing-crisis-marketwatch: Personal Finance News from Yahoo! Finance

[Captain Bill]

Everyone is going to have their own opinion on where the market is headed, and how soon it will recover.

Someone is going to be right, and it's likely going to be the ones who are monitoring what is actually happening "in real time" to the supply and demand trends.

Certainly jobs are needed, and Phoenix needs to attract large companies. However, that is not the total picture. Home prices here are dirt cheap. Investors from all over the country, Canada, and other countries realize that and are buying up the cheap inventory.



The general public is still waiting for the market to "bottom".

• What will they do when they learn that the bottom has passed?
• What will they do when the interest rates begin to increase?
• What will they do when they begin to get more confidence in the economy?

Supply and Demand drives Real Estate and Real Estate Prices, so it's important to be aware of public confidence/sentiment changes.

The author mentioned high sales in June, but failed to mention that was a "record" high, and the sales had been strong since Dec 2010.



I disagree with the number they state of "over 120,000 empty or foreclosed homes".

• Who provided that number?
• How they got them?
• Who counted all the "empty" homes?
• How did they count them?
• How long did it take to discover that each house was empty?
• Did the empty home belong to a snowbird, or sunbird?
• Did the empty home belong to a family on vacation?
• Was there double counting?

Let's say it took 6 months to count all the empty homes.
Was the last home that was counted, empty on the day the first home was counted? If not then there is a double count.

Were some of the empty homes also foreclosed homes so that there was more double counting?

We currently only have 16,204 Lender Owned (foreclosed) properties in the valley, and that number is declining . This number is updated daily.

That accounts for the "foreclosed" homes in their "empty and or foreclosed statement".

Where are the other 103,796 empty homes?

Here are some current statistics on Lender Owned Homes that you won't get from reading those articles:

6,999 Active REO's on 7/27/2010
5,600 Active REO's on 4/27/11
4,360 Active REO's on 6/27/11
3,864 Active REO's on 7/27/11 (Almost half of the number one year ago)

3,925 Sales per month on a monthly basis as of 7/27/11

That is a one (1) month supply of REO's valley wide.

Of the 16,204 inventory of REO's, 3,874 are Active on the MLS

That leaves 12,330 that are not yet listed. If they were all listed today, at the current absorption rate, they would be all Sold in 4 months (assuming they are priced at the current market value given the condition)

The prices have remained fairly stable since Dec 2010, increasing in some cases and declining in others.

Part of the reason for some prices declining, despite the fact that the demand is still high and the inventory is low, is around 40% of the homes are being sold to investors.

If this inventory continues to decline, the already fierce competition will most likely heat up more and prices will have to increase to some degree. My guess is that will happen during the first half of 2012.

Regarding the Foreclosure Inventory:

16,870 Short Sale Active Listings on 7/28/2010
11,042 Short Sale Active Listings on 7/28/2011 (A decrease of 34.7%)

With my personal experience the demand is still strong. The calls have not declined for me. I'm still getting calls from regular buyers as well as investors. I'm only one Broker, so that in itself is not a good measurement, but I'm hearing the same reports from agents in my network.

[Boompa]

I've been walking around trying to buy for cash in the east valley. It appears National Politics will change that. My income is entirely based on Veterans Compensation and Social Security so I won't be buying anything until I am certain that the Federal Government has gotten it's act together, at least until the election. I can't help but wonder how this uncertanty will effect the market

[themudpuppy]

Originally Posted by Boompa

It appears National Politics will change that. My income is entirely based on Veterans Compensation and Social Security so I won't be buying anything until I am certain that the Federal Government has gotten it's act together, at least until the election. I can't help but wonder how this uncertanty will effect the market

I've been wanting to talk to the mortgage broker who was recommended to me, to see what my chances are for qualifying for a new house, so that I don't sell my current house and then find out I can't get another house. I'm holding off on calling her until after we see what happens with this debt ceiling crisis, because the outcome of that could make getting a loan harder. I figure if I talk to her now, the whole scenario may change next week, so better to wait until after we know what our government is going to do.

[Boompa]

Originally Posted by tnp

I've been wanting to talk to the mortgage broker who was recommended to me, to see what my chances are for qualifying for a new house, so that I don't sell my current house and then find out I can't get another house. I'm holding off on calling her until after we see what happens with this debt ceiling crisis, because the outcome of that could make getting a loan harder. I figure if I talk to her now, the whole scenario may change next week, so better to wait until after we know what our government is going to do.

This thing could have been settled weeks ago, you may be holding off for a long time. I don't know if I will have a check Tuesday.

[themudpuppy]

Originally Posted by Boompa

I don't know if I will have a check Tuesday.

Same here.

[gtbguy]

Originally Posted by aliveandwellinSA

Time to buy
or time to cry?
Probably depends if you want a deal, or if you want to sell,
or if you don't care
because you aren't going anywhere.

phoenix-epicenter-housing-crisis-marketwatch: Personal Finance News from Yahoo! Finance

Gotta love these "the sky is falling articles".

[_Charles_]

Originally Posted by aliveandwellinSA

Time to buy
or time to cry?
Probably depends if you want a deal, or if you want to sell,
or if you don't care
because you aren't going anywhere.

phoenix-epicenter-housing-crisis-marketwatch: Personal Finance News from Yahoo! Finance

A well written, balanced, accurate article. Thanks for posting.

[Captain Bill]

Originally Posted by _Charles_

A well written, balanced, accurate article. Thanks for posting.

They say there are 120,000 foreclosed and empty homes in the valley.

I've been trying to figure out where that number came from by looking at the data available from the Cromford Report whose numbers I believe to be accurate, and they just don't make sense.

There are 16,204 lender owned homes (foreclosed and empty)

That leaves 103,796 empty homes to be accounted for

There are 22,000 Pending Foreclosures (homes that have had a Notice of Foreclosure Sale issued) We know they are not all empty because many of the owners are still occupying the homes working a short sale.

Even if they were all empty, that would still leave 81,796 empty homes to be accounted for.

I'm looking at a lot of data that's available to me so I must be missing something.

Since you confirm their accuracy, please explain where all those empty homes are.

[Howard Roark]

I think the RE bottom in Phoenix will be in 2012 or 2013. Out of ten people I know who lost their Phoenix jobs at that software company I used to work at, nine of them are employed. About six of them got new jobs in Phoenix. Two at Intel, one at Honeywell, and the rest at smaller companies.

And no, I'm not buying yet. I work outside Phoenix. Why should I buy a house just to leave vacant five days a week and it's not fair to neighbors who would like someone to rely on for help, only to have a vacant house next door...