Phoenix Real Estate, Coronavirus and Stock Market Drop (to rent, houses)

[franniejacks]

Originally Posted by Jiff

I'm guessing that the 55+ communities are less likely to have house prices drop since most owners and buyers don't depend on income from a job.

The average age in a 55+ is closer to 70. This virus hits the elderly first. May be an increase in estate sales later this year.

[Finper]

Any opinions on the fed interest rate getting slashed and real estate? I’m selling my so cal condo next month and moving to Az in May. I plan to rent for a while and hopefully will time this to be advantageous to me. Right now lots of unknowns though. I plan on living in Oro Valley

[autism360]

Originally Posted by IowaViking

I was talking with a realtor who was very familiar with the 55+ scene from the 2008 era. He said that the market did not bottom until several years later, and then was slow to return.

I think that there are several forces at play-

It has been a seller's market in 55+ for awhile. The bull market has created a number of new retirees with coins in their pockets.

This recent bust in the market will cause a number of folks who were going to retire to rethink their plans. A number of purchases will be put on hold for a year or more.

The conveyor belt of life continues to run, and we will continue to see 55+ homes come on the market from folks that have expired or move to other accommodations. If the virus accelerates the conveyor belt, we could see more disruption.

If- the market does not recover quickly && If- the conveyor belt accelerates, we could see a buyers market and a collapse of home values. It may take a year or two to get there. I have seen some flipper houses get marked down dramatically just this last couple days. Some of those folks are spooked at carrying the note on a house that they were sure was going to be a quick profitable flip.

It is about supply and demand I get 10 offers a week by phone ,text and mail on my home which is NOT FOR SALE so the demand is huge however they are not building many homes in 300k price range so the supply will continue to be low in that price range until they do. There are so many businesses buying homes to flip and rent now the average home buyer is at a huge disadvantage. My advice would be to buy a condo since most of the flippers and big corporations buying homes seem to target single family homes.

[KurtAZ]

Originally Posted by Finper

Any opinions on the fed interest rate getting slashed and real estate? I’m selling my so cal condo next month and moving to Az in May. I plan to rent for a while and hopefully will time this to be advantageous to me. Right now lots of unknowns though. I plan on living in Oro Valley

They cut the short term rate. It may have some effect on mortgage rates if you are in an ARM but it probably won't affect fixed rate mortgages.

[Prickly Pear]

Originally Posted by autism360

It is about supply and demand I get 10 offers a week by phone ,text and mail on my home which is NOT FOR SALE so the demand is huge however they are not building many homes in 300k price range so the supply will continue to be low in that price range until they do. There are so many businesses buying homes to flip and rent now the average home buyer is at a huge disadvantage. My advice would be to buy a condo since most of the flippers and big corporations buying homes seem to target single family homes.

I stumbled upon a condo in North Central at around 235k and it had an offer on it and taken off in less than 12 hours. Home was already updated so it definitely wasn’t a flipper. Probably a rental company or an extremely aggressive average buyer. I mean the offer may not go through but who knows. I watch the North Central area and condos in that area are not going that fast, despite it being such a good area. I also look at Midtown, Downtown and East Phoenix (south of Piestewa Peak).

Here in Tempe a house down the street from us had an offer and sold within 24 hours. I live in a historic neighborhood with irrigation and very small homes (1000 sq ft on average or less) but that doesn’t stop the mail going to my landlord about trying to buy the house. My neighborhood hovers right around 300k for value despite small house sizes. But my neighborhood is all about it’s location. Light rail and free orbit access with a decent proximity to ASU makes it prime to rent to students. Even though my neighborhood is mostly families still.

[wase4711]

we're in an area just north of Arrowhead ranch, home prices in the 350-800k range, and, every house that has been for sale has been sold in a couple weeks or less..

I dont see any slowdown at all in home buying, especially if your credit is decent, and now you can get a 2.5-3.5 % mortgage which will help sales even more...

[Valley Native]

Originally Posted by wase4711

I dont see any slowdown at all in home buying, especially if your credit is decent, and now you can get a 2.5-3.5 % mortgage which will help sales even more...

A few months ago, I would have agreed with this. But with everything seemingly crashing to a halt as of now, I'm having my doubts about the market. I hope Trump is right that the economy will be back up & running after this Corona scare is all over, but nobody can accurately predict that at this point. This shutdown could have a long term ripple effect effect on the overall economy ... especially in the Phoenix area because this time of year is usually active here. This city is losing out on a LOT of expected revenue that we typically see during the late winter & spring.

[wase4711]

I'm not sure everything is crashing to a. halt now, especially when it comes to anyone who had already started the home buying process..I have a few friends in that position now, and none of them has said they were going to stop the home selling/buying process at this point, and about 8 houses in my development have sold/been listed in just the last couple of weeks..

But you're right, the area has lost alot of expected revenue, but there are still tons of large investments and projects either going on or planned for the area, so I think its way too early to write all that off..
Here's a giant one that should be a boon for the state...

https://www.pinalcentral.com/busines...nLiTYw8eiTELoQ

[Valley Native]

Originally Posted by wase4711

I'm not sure everything is crashing to a. halt now, especially when it comes to anyone who had already started the home buying process..I have a few friends in that position now, and none of them has said they were going to stop the home selling/buying process at this point, and about 8 houses in my development have sold/been listed in just the last couple of weeks..

But you're right, the area has lost alot of expected revenue, but there are still tons of large investments and projects either going on or planned for the area, so I think its way too early to write all that off..
Here's a giant one that should be a boon for the state...

https://www.pinalcentral.com/busines...nLiTYw8eiTELoQ

I know, but unless the local & national economy bounce back after this very abrupt shutdown, expect a fairly long term ripple effect, much like the last downturn from 2008 onward. It could affect everything: consumer goods, travel & entertainment, new car sales, real estate, you name it. I'm hoping it won't come to that, but you never know. As I stated before: all the Chicken Littleism is likely going to cause more harm than the virus itself. I agree that taking precautions & trying to stay healthy are what we should all be doing, but going into panic mode is senseless.

[AndroidAZ]

These are unprecedented times, however, I don't think real estate will crash like last time.

First of all, many people have been priced out of real estate and learned a bitter lesson in the last downturn - you don't pass an opportunity to buy real estate in Phoenix when it is on sale.

Most people had no historical context to compare during the last downturn, and were scared to buy homes. Now they see how the economy recovered and the house prices shot up and they were locked out of the market, I think they won't be as scared to buy homes this time around.... fool me once, shame on you, fool me twice, shame on me.

They aren't making more land in many areas of Phoenix, and this is still a very desirable place in terms of cost of living, all of the remote work that has been happening and will now be happening even more, makes it a super attractive place for people who can remote work anywhere. (I can remote work and live anywhere, and I choose to live in AZ).

So should we be concerned? Absolutely...should we be scared? I don't think so. I think real estate will stay steady or even rise due to government stimulus, rushing of money out of equities into hard assets like homes, and convergence of remote workers who are making high income living in cheaper place like Arizona.