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Old 11-01-2011, 08:05 PM
 
1,433 posts, read 2,969,995 times
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Those numbers don't say anything about the nature of the buyers. I suspect you've got a large number of investment groups starting to come in to buy properties with a relatively short buy & hold objective. They know the bump in price won't last long ... too many on the sidelines waiting to sell at the first sign of strengthening. More supply softens prices, bringing prices well below the lows of this year ... possibly 20% lower. By the way, construction spending for new apartments nationwide is WAY up. Once online they will soften rental revenues. Until then, enjoy your neighbors ... most of them will be renters.
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Old 11-02-2011, 12:02 AM
 
Location: Scottsdale, AZ
768 posts, read 1,752,048 times
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Thank you for the information.

Until there is job creation above the service-level mean and a better public education system in AZ the state will continue to struggle in multiple areas including real estate. Investors are good for renters - but not for building communities.
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Old 11-02-2011, 05:02 AM
 
50 posts, read 83,396 times
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Downtown Phoenix condo owner here. I can attest that things are pretty good for us. My community had our first resale (pretty new here) last May and the seller made a nice $10K profit. Then again, we are going to have our first short-sale here soon, so we will see how that works out.
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Old 11-02-2011, 09:39 AM
 
Location: Gilbert - Val Vista Lakes
6,069 posts, read 14,727,324 times
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Quote:
Originally Posted by actinic View Post
Those numbers don't say anything about the nature of the buyers. I suspect you've got a large number of investment groups starting to come in to buy properties with a relatively short buy & hold objective. They know the bump in price won't last long ... too many on the sidelines waiting to sell at the first sign of strengthening. More supply softens prices, bringing prices well below the lows of this year ... possibly 20% lower. By the way, construction spending for new apartments nationwide is WAY up. Once online they will soften rental revenues. Until then, enjoy your neighbors ... most of them will be renters.
I don't think the apartment construction is going on strongly in the Phoenix area at this time. I believe the current apt vacancy rate is around 12%, with optimum being around 5%.

There are also many people waiting to buy, and as prices increase, they may feel they're missing the bottom and go ahead and buy.

In a couple years the people who lost their homes will be back on their feet and ready to buy again.

A large Baby Boomer group of retirees will be retiring to the Phoenix area during the next 18 years.

You certainly may be correct
that more sellers may soften the market. However, with the rapidly declining supply we are experiencing, and the pent up demand that's been discussed, I don't see that happening.

In October, about 25% of buyers are landlord types, and some of them are buying to rent until retiring, at which time they will relocate.

My buyer clients are:
  • First time home buyers
  • Relocating families
  • Vacation home buyers
  • Retiring buyers
  • Investor (landlord type)
  • All price ranges
Notice that move-up buyers are not on that list. They are waiting.

Investors, both landlord type and fix and flip, are responsible for shoring up the real estate market here, because they were buying when others were afraid to buy. They cleaned up most all of the mess that homeowners were leaving as they vacated their homes.

If it were not for the investors we would probably today be seeing terribly run down neighborhoods all across the valley. Plus, many HOA's may have had to increase their dues significantly to make up the loss from the people who stopped paying them. It's very possible that it was the investors who saved the market.

Today in most communities there are only a few distressed homes. In Val Vista Lakes in Gilbert, a community of 2000 homes, there are only 2 short sale homes, and 1 bank owned home.

  • Most of the landlord investors I know are looking for long term appreciation, and plan to hold for 5-10 years.
  • Some are buying today to rent until they retire, then use the home as a retirement home.
Renters are people, the same as homeowners. Many were homeowners who lost their homes to foreclosure due to loss of jobs, medical hardships, family deaths, and other reasons. Many take pride in keeping the rented home and yard clean.

We have 2 renter neighbors within one block, and they are great people, keep their yard clean, friendly, and respectful of their neighbors.

I agree there are exceptions, but since so many communities are in HOA's the homeowner is still responsible to see that the yard is maintained, therefore, the exterior condition of a rental home is usually not a problem.
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Old 11-02-2011, 11:21 AM
 
Location: Scottsdale, AZ
426 posts, read 1,301,042 times
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Quote:
Originally Posted by Ponderosa View Post
September 2011
Traditional Sales.........4,110
Foreclosure Sales.......2,295

That is a stunning turn-around.
I have a thread I'm mainting about the traditional sale of my house. I'll mention here in case others have missed it.

I listed my house just south of Anthem up for sale in October and had an acceptable cash offer in two weeks. This past weekend my wife and I found a house in North Scottsdale that is also a traditional sale and we're under contract on it as of two days ago.

I saw a couple houses in our target area and price range that were traditional sales. I was surprised to see them popping up in the listings.

Quote:
Originally Posted by MotleyCrew View Post
It is looking a little wobbly this morning for sure.
I think I need to send a thank you note to the Prime Minister of Greece. Yesterday I locked in a 5% down, 30 year fixed mortgage with zero points at 4%.
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Old 11-02-2011, 11:33 AM
 
Location: Sierra Vista, AZ
17,531 posts, read 24,601,871 times
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That's about half of replacement value, nothing to dance about there. Moderator cut: snip

Last edited by Kimballette; 11-02-2011 at 11:52 AM.. Reason: off topic
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Old 11-02-2011, 12:47 PM
 
Location: Cave Creek, AZ USA
1,775 posts, read 6,333,779 times
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I'm kind of curious about a new condo complex going up near my house. It's the corner of Pinnacle Peak and Tatum. But City North is about a mile away, a very short walk to Desert Ridge, has its own shops and restaurants and seems like a ghost town. How is a builder able to get financing for more expensive places, farther from anything, when a much more desireable location still can't sell all their units?
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Old 11-02-2011, 11:47 PM
 
Location: Calgary, AB
681 posts, read 1,554,261 times
Reputation: 750
Quote:
Originally Posted by musicforme View Post
I think I need to send a thank you note to the Prime Minister of Greece. Yesterday I locked in a 5% down, 30 year fixed mortgage with zero points at 4%.
Good for you musicforme!
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Old 11-03-2011, 12:05 AM
 
4,619 posts, read 9,225,654 times
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Quote:
Originally Posted by Captain Bill View Post
Today in most communities there are only a few distressed homes. In Val Vista Lakes in Gilbert, a community of 2000 homes, there are only 2 short sale homes, and 1 bank owned home.
I'm showing 10 active/AWC or Pendings in VVL which are short sale, pre-foreclosure, lender owned or HUD. That's only the area East of Val Vista Road too. Rather than Searching by subdivision, I circled the subdivision and may have included some areas that are technically just outside of VVL. The point is correct though, distressed sales are drying up. And while investor sales (fix and flips) are not "arms length transactions" per se, they are not distressed sales either, and usually sell within 30 days on the market, whereas most short sales are over 100 days at a reduced price. I know homes in my area are snapped up relatively quickly for 100% of LP on average, we'll see if that changes whenever rates go up.
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Old 11-03-2011, 09:12 AM
 
Location: Gilbert - Val Vista Lakes
6,069 posts, read 14,727,324 times
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Default Val Vista Lakes Home Sales Information

Quote:
Originally Posted by asufan View Post
I'm showing 10 active/AWC or Pendings in VVL which are short sale, pre-foreclosure, lender owned or HUD. That's only the area East of Val Vista Road too. Rather than Searching by subdivision, I circled the subdivision and may have included some areas that are technically just outside of VVL. The point is correct though, distressed sales are drying up. And while investor sales (fix and flips) are not "arms length transactions" per se, they are not distressed sales either, and usually sell within 30 days on the market, whereas most short sales are over 100 days at a reduced price. I know homes in my area are snapped up relatively quickly for 100% of LP on average, we'll see if that changes whenever rates go up.

Thanks for pointing that out.
Last week I prepared a Powerpoint presentation for a group on the Future of Gilbert Real Estate Market, and when I checked there were 2 Active short sales, and 1 Active Lender owned.

In the past 7 days there were 2 short sales added, making it currently 4 short sales and 1 lender owned. I don't count AWC or Pending as Active because they already have a contract.

This is the current list for all of Val Vista Lakes this morning:
  • Active....................... 21.....includes 4 short sales and 1 REO
  • AWC...........................6
  • Pending.....................10
  • Closed Year to Date.....80

Last year Val Vista Lakes sold 86 homes. This year it's on track to sell close to 100 homes, which will be an increase of around 16%.

The best way to search in Val Vista Lakes is to draw a shape of the entire community. The reason is that agents who list there and are not familiar with Val Vista Lakes will show the sub-community name as the community. So if one searches for "Val Vista Lakes", the homes that only show the sub-community of (for example) Tanglewood Cove will not show up on the search.

Using Val Vista Lakes Elementary School
as a search criteria is next best, but sometimes agents don't put that on the sheet, or they will put the wrong school.

On my web site, which goes directly into the MLS, one can draw any type of odd shape. I draw a shape around the entire perimeter of the community so as to get every home in there. That's the way I search most all communities and sections of cities. It's better than a circle because I can include only the area of interest.

To the north, south and east it's simple. Just go to Baseline, Guadalupe and Greenfield. You'll get the commercial areas, but they don't show up as residences in the search.

To the west of Val Vista Drive is a bit tricky.

Just west of Val Vista Drive, and south of Mission Bay Dr. look for the small community, "Kings Court at Val Vista Lakes". (They are not part of Val Vista Lakes.)

Begin your southern line just to the north of that community. You'll be getting the southern part of La Jolla Village in Val Vista Lakes.

Draw that shape westerly to Nielson St, and then north to Baseline. That will get every house in Val Vista Lakes. There is also a "nosy neighbor" feature on the search page where you can see the sold prices of homes.

Regarding Arms Length Sales, you may be confusing Arms Length with a Traditional sale.

Most all sales are Arms Length, which means that the buyers and sellers of a property act independently and have no relationship to each other.

The concept of an arm's length transaction is to ensure that both parties in the deal are acting in their own self interest and are not subject to any pressure or duress from the other party.

Here's one example: A seller of a short sale home wants to lease back from the Buyer. (Short sale lenders do not allow this.) Buyer and Seller make a side deal and surreptitiously sign a lease agreement. That Sale transaction is now not an Arms Length Transaction because the Buyer and Seller have a contractual Lease Relationship.

Banks are requiring Brokers, Buyers and Sellers to sign a form stating that the transaction is Arms Length and there is no relationship between Brokers, Buyer and Seller.

And yes you are correct, a rehabbed (fix and flip) home is not considered a distressed home.
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