Honestly, when will the Phoenix real estate market bottom out? (Scottsdale: foreclosed, renters)

[steve22]

Originally Posted by Bill-

Or you could be completely wrong and no such dire circumstances will arise. Most of the same criticisms you hurl at Phoenix were directed at Los Angeles in the 1960's,1970's and 1980's. Out of control sprawl, an economy based only on growth, water shortages etc. Los Angeles matured and diversified and chances are Phoenix will do the same. If I had a dime for every chicken little theory I have heard about Phoenix, LA, Denver, Seattle etc. I'd be a rich man.

Yeah, look at L.A. now- it's a polluted, gridlocked mess of a city, the cost of living is exorbitant, and the middle class has largely vanished. L.A. now has the highest total number of millionaires of any city in the country, and it also has the highest number of people living below the poverty level. The flight of middle class income earners from L.A. has been well-documented, and in the past few years L.A. has seen a net population loss. I'm not saying the water will run out in Phoenix or that the gas pumps will run dry- what I'm saying is that the lack of those resources nearby may cause them to become much more expensive in the future. They'll find a way to solve the water issue- the question is, will it be a cheap solution. It may not. In L.A. over the past decade, the sheer cost of living increased to the point that a middle class income would no longer support a decent quality of life. And if that happens in Phoenix, the lure that has attracted so many transplants to the area will cease to exist. It's foreseeable that the same phenomenon that hit L.A. the past decade will hit Phoenix, too. If there is a major flight of the middle class out of Phoenix, it would crash the real estate/construction business and with it, the economy.

Maybe you're right and I will turn out to be wrong, but Phoenix sure doesn't seem to be learning from L.A.'s mistakes in time to save itself. Your observation that L.A. adapted and diversified, and Phoenix will do the same, implies a level of foresightedness from the city planners & developers in Phoenix that I have yet to witness. But we shall see.

And also, L.A. is a much bigger city, with a whole lot more to bolster its economy besides construction and real estate. The cornerstone of L.A's economy has never been sheer growth or real estate the way it is in Phoenix, that I know of. L.A. is a major seaport, for starters, as well as the largest city and financial capitol of the American west. Not to mention the entertainment capitol of the world. That was true before the huge growth it saw in the '60's. It's not true for Phoenix right now, and it won't ever be. L.A. will always be L.A.; Phoenix is just the flavor of the month, from my point of view. Like I said, a housing or construction slump would hit Phoenix a lot harder than most other places in the country, L.A. included, b/c there just isn't anything else. And I don't imagine that there will be enough changes made before it's too late.

[sheena]

Originally Posted by JasonS

I could have spent 200k for a house in surprise but i wanted something bigger.

Houses where i live here start at 500k for a 2 bedroom house in the ghetto. The house i bought would easily cost over 1 mil and thats if it was in a bad neighborhood.

I could have bought a house in scottsdale for 400k but how much house would i have gotten and how old would it have been?

You were worried about the market bottoming out that's why I said if I was spending 400,000 right now I wouldn't be spending it in Surprise, but I probably wouldn't be buying right now anyway. Just my opinion it means nothing.

[ArizonaBear]

Originally Posted by steve22

Yeah, look at L.A. now- it's a polluted, gridlocked mess of a city, the cost of living is exorbitant, and the middle class has largely vanished. L.A. now has the highest total number of millionaires of any city in the country, and it also has the highest number of people living below the poverty level. The flight of middle class income earners from L.A. has been well-documented, and in the past few years L.A. has seen a net population loss. I'm not saying the water will run out in Phoenix or that the gas pumps will run dry- what I'm saying is that the lack of those resources nearby may cause them to become much more expensive in the future. They'll find a way to solve the water issue- the question is, will it be a cheap solution. It may not. In L.A. over the past decade, the sheer cost of living increased to the point that a middle class income would no longer support a decent quality of life. And if that happens in Phoenix, the lure that has attracted so many transplants to the area will cease to exist. It's foreseeable that the same phenomenon that hit L.A. the past decade will hit Phoenix, too. If there is a major flight of the middle class out of Phoenix, it would crash the real estate/construction business and with it, the economy.

Maybe you're right and I will turn out to be wrong, but Phoenix sure doesn't seem to be learning from L.A.'s mistakes in time to save itself. Your observation that L.A. adapted and diversified, and Phoenix will do the same, implies a level of foresightedness from the city planners & developers in Phoenix that I have yet to witness. But we shall see.

And also, L.A. is a much bigger city, with a whole lot more to bolster its economy besides construction and real estate. The cornerstone of L.A's economy has never been sheer growth or real estate the way it is in Phoenix, that I know of. L.A. is a major seaport, for starters, as well as the largest city and financial capitol of the American west. Not to mention the entertainment capitol of the world. That was true before the huge growth it saw in the '60's. It's not true for Phoenix right now, and it won't ever be. L.A. will always be L.A.; Phoenix is just the flavor of the month, from my point of view. Like I said, a housing or construction slump would hit Phoenix a lot harder than most other places in the country, L.A. included, b/c there just isn't anything else. And I don't imagine that there will be enough changes made before it's too late.

One could use the same arguments to describe New York City/NJ, Chicago Metro, the Puget Sound area, Wash DC metro, etc.--------all of which are overpriced, overcrowded, and have worse winter weather than either Calif or the Phx area

[Deblyn]

How legal is it for different builders to have different selling contract addendums with regard to occupancy? We found a home we really liked with Richmond Homes, however, we can't move there for several years but would like to make it our final home. However, the addendum form they offer only has two choices (1) primary residence - where you must live there and work there (2) second home - for vacations - no rentals or timesharing allowed.

This was the deal breaker for us and now we are finding out that Element homes doesn't have this addendum. Is there some reasoning for this? We went thru all the paper , checked out all the loan , ready to buy.

We fell in Love with the house, But only to be so disappointed.

[ivanabacowboy]

Deblyn, it is entirely legal. The community does not want a "transient" type population for whatever reason (ie no timesharing or rentals). Just like they can mandate what color you paint your front door and what color curtains you hang in the window.

[Ponderosa]

Good for Richmond American or the HOA. There are few things that bring down a neighborhood faster than rentals. They are equivalent to a couch on the lawn in my opinion and I wish more HOAs would ban rentals instead of focusing on trivial things that do not impact property values.

[steve22]

Originally Posted by ArizonaBear

One could use the same arguments to describe New York City/NJ, Chicago Metro, the Puget Sound area, Wash DC metro, etc.--------all of which are overpriced, overcrowded, and have worse winter weather than either Calif or the Phx area

You're missing my point. All of those places are older, established cities and are major hubs of industry, government, SOME other source of economic stability besides sheer growth. Phoenix is a boomtown- and that's about it. There's nothing to save Phoenix if the construction/real estate market crashes. Weather has very little to do with anything, from that perspective.

And the other point is, those cities don't have issues as far as trying to change their environment to make it livable; you'll never see water become outrageously expensive in Chicago or Puget Sound, for example, because there's an infinite supply of it right there.

[sablebaby]

Originally Posted by Deblyn

How legal is it for different builders to have different selling contract addendums with regard to occupancy? We found a home we really liked with Richmond Homes, however, we can't move there for several years but would like to make it our final home. However, the addendum form they offer only has two choices (1) primary residence - where you must live there and work there (2) second home - for vacations - no rentals or timesharing allowed.

This was the deal breaker for us and now we are finding out that Element homes doesn't have this addendum. Is there some reasoning for this? We went thru all the paper , checked out all the loan , ready to buy.

We fell in Love with the house, But only to be so disappointed.

Oh, perfectly legal!! They can write the CC&R's to anything, as long as it doesn't affect a protected class. And the last time I checked investors/rentals are NOT a protected class. It's GREAT that they are doing that, too bad more didn't. But, for most it's all about the money!

[ArizonaBear]

Originally Posted by steve22

You're missing my point. All of those places are older, established cities and are major hubs of industry, government, SOME other source of economic stability besides sheer growth. Phoenix is a boomtown- and that's about it. There's nothing to save Phoenix if the construction/real estate market crashes. Weather has very little to do with anything, from that perspective.

For the record: aside from immigration from places like Mexico, etc. Illinois would be suffering population decline.

Wash DC is a government town------if the Nation's Capital moved to, say Oklahoma, DC would likely shrivel up and be little more than a pit stop between Baltimore and Richmond.

NYC is a major hub, yes for many things.

Heck: look at SE Michigan (Detroit area); its is dying despite very inexpensive housing and lots of water due to the collapsing Detroit Three auto industry.

And the other point is, those cities don't have issues as far as trying to change their environment to make it livable; you'll never see water become outrageously expensive in Chicago or Puget Sound, for example, because there's an infinite supply of it right there.

Puget Sound area I tend to agree-------as for Chicago, etc. the severe winters can be deadly without proper shelter and heat in the winter.

Pick your poison-------I will deal with the heat here in Az vs. the nasty '4 season' weather in the Frost Belt.

Now; as for the overcrowding here in the Phx area; you will get a more sympathetic ear from me

[Deblyn]

Im all for the commuity having there hoas and there rules. but all the investers have ruined it for the little person. My son and his daughter live there as well as there family. but i can't even rent my own property to a family member . I have no problem living there. but i cant till my job to make me a opening when they dont have one. Thanks lyn