Phoenix Real Estate Market Keeps Tanking (Chandler, Surprise: metropolitan, distance, expensive)

[ShampooBanana]

To someone who knows, how much prices on average increased in the past 3 months? I'm most curious about in more established areas like central Phoenix, Tempe, Scottsdale, etc. I'm thinking places that dropped the most like Queen Creek, Maricopa, Buckeye, etc. have had the msot dramatic increases.

[Zippyman]

Originally Posted by ShampooBanana

To someone who knows, how much prices on average increased in the past 3 months? I'm most curious about in more established areas like central Phoenix, Tempe, Scottsdale, etc. I'm thinking places that dropped the most like Queen Creek, Maricopa, Buckeye, etc. have had the msot dramatic increases.

It's funny you mentioned Queen Creek - at the peak of the crash I took my parents to look at a few 2000 sq ft, nearly new homes that were lender-owned, and in decent shape. I remember there were so many for sale at the time, that to sort them out, we raised the search criteria to require 3 car garages. We found half a dozen for between $70-$80k. I just got an email today from a builder selling smaller homes, with a two-car garage, starting at $179k. What a difference a couple years makes!

[jimj]

The following pretty much flies in the face of reality, at least from my perspective.
From MSN:
"Home prices in most of these markets will continue dropping next year. David Stiff, the chief economist at Fiserv Case-Shiller, told 24/7 Wall St. that the nation's housing recovery is not expected to reach full swing until the end of next year -- even in the areas that are leading the country in recovery. Nationally, home prices are expected to increase much more in 2013 than in 2012, but not for many of the cities on this list."

"No. 2: Phoenix-Mesa-Glendale, Ariz.
Expected price change: -11.1%
Unemployment rate: 7.7% (184th highest)
Change in home prices (2010 Q4 to 2011 Q4): -1.2%


Home prices in the Phoenix-Mesa-Glendale metropolitan area have dropped 56% since their peak in the second quarter of 2006. The region also has been plagued by high foreclosure and delinquency rates since then. In 2011, home prices fell only 1.2%, but this rate is expected to increase significantly to 11.1% in 2012. The trend is expected to reverse in 2013, with home prices increasing 0.4%."

Full article: 10 cities with collapsing home prices - housing market - MSN Money

[john3232]

I take a lot of stock in what Case/Shiller reports but prices certainly have gone up since last summer in Gilbert and Chandler.

East Mesa only marginally.

Can’t speak for the other areas.

[MN-Born-n-Raised]

The ASKING PRICE (cost per square foot) has dropped a couple of dollars here in Surprise to about $81. So the confidence of asking more money has softened. The inventory has leveled off as well but it is still very low. In Gilbert, it seems that ASKING PRICE is still going up (see Show Me the Data – Altos Research ) but the inventory is rising slightly. Just plug in your town to see what the trends are.

Personally,I don't feel that prices are going to go up for the remainder of the year. They might drop a dollar or two per square foot. If things are status quo by next February, it probably will continue to rise again but the huge surge in prices won't continue. That's just my gut feeling. There needs to be builder inflation because existing home prices are bumping into new home prices. So areas where there is a lot of land will slow down quicker than say Phoenix.

[sh9730]

MN,

Yep, I think tooo many people are now thinking they can sell down here in CG at a "normal" price. Our inventory is increasing by 3-5 units a day (up to 146 today not included AWC) vs 135 or so just a week or so ago. People are trying to get 80+ per sf down here, and it just isnt happening....

My guess is either these people with "normal" sales that had HOPED to sell and move, will pull their stuff off the market and wait it out a little longer, or prices will drop back into the 60-65 per sf rate....

Again, this is Casa Grande....still a little bit exurb when there is stuff closer in at that 80-90 range.

[john3232]

Originally Posted by MN-Born-n-Raised

...Personally,I don't feel that prices are going to go up for the remainder of the year. They might drop a dollar or two per square foot. If things are status quo by next February, it probably will continue to rise again but the huge surge in prices won't continue. That's just my gut feeling...

Yeah, I tend to agree. The market isn`t going to move much either way.

Inventory is up in Gilbert but anything priced in the low 80s per sq ft for example flies off the market in a day or so with multiply offers

However, homes pushing 100 sq ft tend to sit.

Multiply

[MN-Born-n-Raised]

Originally Posted by sh9730

MN,

Yep, I think tooo many people are now thinking they can sell down here in CG at a "normal" price. Our inventory is increasing by 3-5 units a day (up to 146 today not included AWC) vs 135 or so just a week or so ago. People are trying to get 80+ per sf down here, and it just isnt happening....

My guess is either these people with "normal" sales that had HOPED to sell and move, will pull their stuff off the market and wait it out a little longer, or prices will drop back into the 60-65 per sf rate....

Again, this is Casa Grande....still a little bit exurb when there is stuff closer in at that 80-90 range.

I tend to think Casa Grande is a leading indicator. Probably more shift than say Chandler but eventually it ripples though other related areas. If interest rates pop-up 1%, we will test how strong of a recovery we really had. I bet it would soften a lot.

I wonder what the banks are projecting. I don't necessarily think that I would be buying right now if "investment" was my only motive.

[john3232]

This Gilbert owner is asking $133 per sq. foot.

MLS#4770612

Excellent location and home looks very nice. However, the home is small, the lot under 4000 sq ft and the property was built in 1986.


This isn`t anything special and asking is $137 per sq ft. in Gilbert
MLS#4794261

[Captain Bill]

Originally Posted by john3232

This Gilbert owner is asking $133 per sq. foot.

MLS#4770612

Excellent location and home looks very nice. However, the home is small, the lot under 4000 sq ft and the property was built in 1986.

It's built 1986 but has been highly updated. It's in Val Vista Lakes which is a desirable community because of the clubhouse and lake amenities with low dues of $88.20/mo. [/quote]

My listing, also in Val Vista Lakes, which is similar to that one in updates, and with a pool, is under contract for $124/sf. So that one is priced higher $/sf than my listing.

This isn`t anything special and asking is $137 per sq ft. in Gilbert
MLS#4794261

Right, it appears to be high. But if you look up in north central Mesa you'll find many homes at that price/sf., and higher. The HOA dues at $30/mo are ok because it's just for common area maintenance.

I didn't check the comps in that area, but it's the comps that buyers are going to look at in determining an offer price.

Many buyers will probably miss the boat on some of these homes that may be priced higher than the comps. Many tend to want to wait until they see price reductions before making an offer. If there are several people waiting and watching, and a reduction is made, then there will most likely be multiple offers, and only one will win the bid.

A smart Realtor (buyers agent) will determine the current market value using comps, and the smart buyer will make an offer that the comps support. A smart buyers agent can negotiate from strength using the comps and statistics. And it's very likely that the buyer and seller will be able to make a deal.

I know that a couple of buyers were watching one of my listings hoping for a price reduction. The seller decided to take it off the market until at least November after the summer slow season.

Within a day I got a call from two agents who had shown the house wanting to know what was happening. One said his buyer was disappointed that it's off the market because they were very interested. He asked if his buyer could come see the home again right away because of their high interest. The seller said yes but only if they are serious. So they went to see the home, and now they're working on an offer.

The other agent was almost the same story, so I told him the situation. Now we have two very interested buyers, who played the waiting game and lost. Now they are in a weaker negotiation situation than they would have been had they not waited, because there is potential competition (if both elect to make an offer.

We hold the better cards because our mindset is to leave it off the market; not being in a hurry to sell.