Phoenix, the most unaffordable "affordable" place to live (Mesa: home builders, neighborhood)

[fr8train]

Originally Posted by asufan

I don't think we'll see a "burst" anything like that, but eventually rates and housing supply will probably start to increase and it will be less of a full blown sellers market. I could see a 10-15% correction (more in the far flung areas) but nothing like the 57% in the last recession.

If this is true...

Originally Posted by kell490

Another house sold on my block 650k this same home was purchased for $350k only 18 months ago. Almost 100% mark up with no improvements or changes to the home. It seems like can ask for any price and you get it right now.

Then the correction is going to have to be greater than it was last time. Did you think 18 months ago that houses would double almost overnight, after what was supposed to be an economic shattering "pandemic"? People earn less than they ever have relative to housing prices, taking inflation into account. Who's going to be paying $650k for these $300k houses? Or $400k for $150k working class homes? How many high paid professionals are out there? Are they descending on Phoenix all at once?

The truth of the matter is this is happening everywhere, even in rural Ohio. Unless this is a sign of massive inflation, there's no way this is sustainable everywhere long term.

[asufan]

Originally Posted by fr8train

If this is true...


Then the correction is going to have to be greater than it was last time. Did you think 18 months ago that houses would double almost overnight, after what was supposed to be an economic shattering "pandemic"? People earn less than they ever have relative to housing prices, taking inflation into account. Who's going to be paying $650k for these $300k houses? Or $400k for $150k working class homes? How many high paid professionals are out there? Are they descending on Phoenix all at once?

The truth of the matter is this is happening everywhere, even in rural Ohio. Unless this is a sign of massive inflation, there's no way this is sustainable everywhere long term.

There's much better loan standards and underwriting guidelines today than there were in 2005-06 and the economy in AZ is much better/more diversified away from construction.

[DetroitN8V]

Originally Posted by fr8train

If this is true...


Then the correction is going to have to be greater than it was last time. Did you think 18 months ago that houses would double almost overnight, after what was supposed to be an economic shattering "pandemic"? People earn less than they ever have relative to housing prices, taking inflation into account. Who's going to be paying $650k for these $300k houses? Or $400k for $150k working class homes? How many high paid professionals are out there? Are they descending on Phoenix all at once?

The truth of the matter is this is happening everywhere, even in rural Ohio. Unless this is a sign of massive inflation, there's no way this is sustainable everywhere long term.

With low interest rates, low property taxes, and an influx of higher-paying professional jobs and employers, people can afford today's prices. $400k for an entry-level home should not be out of reach for most.

[Trail Dreamer]

Originally Posted by DetroitN8V

With low interest rates, low property taxes, and an influx of higher-paying professional jobs and employers, people can afford today's prices. $400k for an entry-level home should not be out of reach for most.

For people who work in service-related professions, it is. Or, it's a long reach and makes them house poor. When I say "service-related" I am not just referring to the individual working down at QT.

I can't tell ya how many people I've talked to here in the PHX area in which half of their salary is devoted to their mortgage.

[Prickly Pear]

When you factor in high utility bills (electric here), high car insurance rates, etc. the fact that our housing may be *marginally* cheaper than other cities does not mean we actually are functionally cheaper on paper. I found 1 bedrooms in NYC with similar prices to units here and because of the extensive MTA system it would probably be cheaper since you don't have to factor in the cost of car ownership.

[john3232]

The cost of housing in San Diego has skyrocketed over the past twenty years and today a S.D. home is twice that of Chandler.

Yet, the median income is slightly higher in Chandler than in S.D.

So, how can people in S.D. afford to spend 600k or twice as much as what a Chandler home costs? Esp. when the medium income in SD is less than Chandler.
Moderator cut: link removed, competitor site
Don't know... but they have been doing so for years.

Rents and the cost of housing in the Phx metro aren't turning back. They will dip and then flatten out. But no...I doubt we'll see a housing cash.

On the other hand if qualifications for a Fannie Mae loan return to what they were when I **bought in 2005 all bets are off.






**I was living overseas and couldn't provide employment verification (at least not in English.) I had my US tax returns and a good credit score.

However, I couldn't verify I was still employed and my monthly income what I claimed.

Yet, I took out four loans!

I've mentioned this before but in 2010 qualifications for a Fannie Mae loan had become much more strict. I couldn't get a loan.

Today I think the minimum credit score is 640 and there are strict employment verification hoops to jump through.

If this should change and someone with a 520 credit score and a marginal income can obtain a Fannie Mae loan to buy a 350k home.

I expect we'll see 2004-2005 all over again.

[asufan]

Originally Posted by john3232

The cost of housing in San Diego has skyrocketed over the past twenty years and today a S.D. home is twice that of Chandler.

Yet, the median income is slightly higher in Chandler than in S.D.

So, how can people in S.D. afford to spend 600k or twice as much as what a Chandler home costs? Esp. when the medium income in SD is less than Chandler.
Moderator cut: link removed, competitor site
Don't know... but they have been doing so for years.

Rents and the cost of housing in the Phx metro aren't turning back. They will dip and then flatten out. But no...I doubt we'll see a housing cash.

On the other hand if qualifications for a Fannie Mae loan return to what they were when I **bought in 2005 all bets are off.






**I was living overseas and couldn't provide employment verification (at least not in English.) I had my US tax returns and a good credit score.

However, I couldn't verify I was still employed and my monthly income what I claimed.

Yet, I took out four loans!

I've mentioned this before but in 2010 qualifications for a Fannie Mae loan had become much more strict. I couldn't get a loan.

Today I think the minimum credit score is 640 and there are strict employment verification hoops to jump through.

If this should change and someone with a 520 credit score and a marginal income can obtain a Fannie Mae loan to buy a 350k home.

I expect we'll see 2004-2005 all over again.

That comparison is a bit flawed however. It would be more fair to compare the median income of a homeowner in San Diego vs the median income of a homeowner in Chandler. Something else to take into account is the relative smaller sizes of homes in San Diego, it's not apples to apples.

[john3232]

Originally Posted by asufan

That comparison is a bit flawed however. It would be more fair to compare the median income of a homeowner in San Diego vs the median income of a homeowner in Chandler. Something else to take into account is the relative smaller sizes of homes in San Diego, it's not apples to apples.

Perhaps not nevertheless a house cost twice as much in SD than in Chandler. 600k vs. 280k.

Yet, the median income for Chandler is slightly higher than in SD

Now, you suggest the median income for home owners in SD might be higher than Chandler. Do you have a link? I think you might be right but I doubt it's enough to offset a huge 300k difference in home prices.

As far as S.D. homes being smaller (on average) than in Chandler... do you have a link?


Here in California, home sizes have also been growing over the past century — but not at nearly the same fast pace as the rest of the country. Since 2010, the average new home size has been:
2,417 square feet in San Diego;
1,862 square feet in San Jose;
1,800 square feet in Los Angeles; and
1,150 square feet in San Francisco.
https://journal.firsttuesday.us/home...ifornia/57728/


Here's what I found regarding Chandler:
1,836 median ave.
https://www.homes.com/chandler-az/wh...my-home-worth/

Yes, one link refers to the average size/homes built since 2010 and the other the median size only. If you have additional info. that would be helpful.

So, how do people afford to buy a house? With regards to the Somali community in City Heights/San Diego which is home to the second-largest Somali community in the United States, some 10,000 strong. I suspect family members went in together to buy a house. Then share it.

Not unlike what the Chinese did in SF

[asufan]

Originally Posted by john3232

[/b]

Perhaps not nevertheless a house cost twice as much in SD than in Chandler. 600k vs. 280k.

Yet, the median income for Chandler is slightly higher than in SD

Now, you suggest the median income for home owners in SD might be higher than Chandler. Do you have a link? I think you might be right but I doubt it's enough to offset a huge 300k difference in home prices.

As far as S.D. homes being smaller (on average) than in Chandler... do you have a link?


Here in California, home sizes have also been growing over the past century — but not at nearly the same fast pace as the rest of the country. Since 2010, the average new home size has been:
2,417 square feet in San Diego;
1,862 square feet in San Jose;
1,800 square feet in Los Angeles; and
1,150 square feet in San Francisco.
https://journal.firsttuesday.us/home...ifornia/57728/


Here's what I found regarding Chandler:
1,836 median ave.
https://www.homes.com/chandler-az/wh...my-home-worth/

Yes, one link refers to the average size/homes built since 2010 and the other the median size only. If you have additional info. that would be helpful.

So, how do people afford to buy a house? With regards to the Somali community in City Heights/San Diego which is home to the second-largest Somali community in the United States, some 10,000 strong. I suspect family members went in together to buy a house. Then share it.

Not unlike what the Chinese did in SF

No, I don't have a link. I am saying that there are likely a lot more renters in San Diego as historically it has been a place that is cheaper to rent than own.

Your median home price in Chandler is way off. No, I don't have a link but there's hardly anything below $300K in Chandler, so no way is $280k the median.

[FirebirdCamaro1220]

Originally Posted by fr8train

If this is true...


Then the correction is going to have to be greater than it was last time. Did you think 18 months ago that houses would double almost overnight, after what was supposed to be an economic shattering "pandemic"? People earn less than they ever have relative to housing prices, taking inflation into account. Who's going to be paying $650k for these $300k houses? Or $400k for $150k working class homes? How many high paid professionals are out there? Are they descending on Phoenix all at once?

The truth of the matter is this is happening everywhere, even in rural Ohio. Unless this is a sign of massive inflation, there's no way this is sustainable everywhere long term.

I think the answer sadly is that the wealthy and big time property management companies will pay cash, and then rent them out to us plebes

I think the days of regular families buying homes to actually live in them are drawing to a close