In 2022, Zillow Predicts That Phoenix housing market will climb ANOTHER 20%?! (Sun City: live, prices)

[MN-Born-n-Raised]

Originally Posted by john3232

Apparently the construction of new homes went into overdrive and now there's a glut. Unless you work in Buckeye I don't see the attraction.

On the other hand Buckeye is one of the fastest growing cities in the U.S. with a pop. of over 50k. We'll see if that continues.
https://www.buckeyeaz.gov/Home/Compo...ng%20101%2C000.

Plus, Buckeye's water relies almost exclusively on groundwater. That's a game that I don't want to play.

[ringler24]

We just went under contract on the sale of our home here. It took us 16 days with one price drop. The last three homes that sold in our neighborhood (all closing before the beginning of June were under contract in a few days for over asking) It's been very eye opening to say the least. We are only doing it because we had it in mind to move back closer to family in the next few years and the toppling real estate bubble made us realize if we waited, we might not be able to. We are going to be buying in an area with lower housing costs, but saying goodbye to our amazing interest rate. Worth it to us. We'll see if this deal actually ends in the sale of our home. I'll keep everyone posted if you all are interested.

[MN-Born-n-Raised]

From the Cromford report:
"The (RE) collapse between April and June is unprecedented - faster and more violent than we have ever witnessed… explosive rise in supply.”

“The contract ratio is telling us that we are already in a balanced market.”

And:

“we have had a very chilly wind blowing through the market.”

“There were just 1,558 accepted contracts during last week, down from 1,898 the week before and 2,274 during the same week in 2021… It is even lower than during the first covid-19 wave in April 2020.”

“We have a full-on buyer's strike developing.”

“more homes are being newly listed for sale than at any time since 2011. The active listing count (without a contract) rose 12% last week…. We are witnessing a full-on seller's stampede.”

Basically, peak pricing occurred in June, not August because the market has changed FAST: From FOMO to a buyers strike. And the PHX housing market is officially at equilibrium. According to the Cromford Report, the median home sale DROPPED 2% in June.

Per Mike Orn: “The stampede for the exit (sellers) is now large enough that it is certain to do significant damage to home values.”

“When a buyer's strike and a seller's stampede occur at the same time, the market stalls in mid-flight.”

Read https://arizonarealestatenotebook.su...m_medium=email for more graphs. My popcorn is popped. It's going to be interesting.

[Ponderosa]

Originally Posted by MN-Born-n-Raised

From the Cromford report:
"The (RE) collapse between April and June is unprecedented - faster and more violent than we have ever witnessed… explosive rise in supply.”

“The contract ratio is telling us that we are already in a balanced market.”

And:

“we have had a very chilly wind blowing through the market.”

“There were just 1,558 accepted contracts during last week, down from 1,898 the week before and 2,274 during the same week in 2021… It is even lower than during the first covid-19 wave in April 2020.”

“We have a full-on buyer's strike developing.”

“more homes are being newly listed for sale than at any time since 2011. The active listing count (without a contract) rose 12% last week…. We are witnessing a full-on seller's stampede.”

Basically, peak pricing occurred in June, not August because the market has changed FAST: From FOMO to a buyers strike. And the PHX housing market is officially at equilibrium. According to the Cromford Report, the median home sale DROPPED 2% in June.

Per Mike Orn: “The stampede for the exit (sellers) is now large enough that it is certain to do significant damage to home values.”

“When a buyer's strike and a seller's stampede occur at the same time, the market stalls in mid-flight.”

Read https://arizonarealestatenotebook.su...m_medium=email for more graphs. My popcorn is popped. It's going to be interesting.

...for all those who said the sellers' market and appreciation were not going to end. Sellers, you waited too long. Buyers, it is still too soon.

[Ponderosa]

Lessons from the (last) fall: If you have a HELOC and you are going to need the money for that pool you contracted two years ago that is still not built, for a vacation, for whatever AND you do not have a ton of equity in your home - take out the money now. As soon as prices start falling lenders can and will freeze the HELOC and you will be unable to get your funds.

[john3232]

Originally Posted by Ponderosa

Lessons from the (last) fall: If you have a HELOC and you are going to need the money for that pool you contracted two years ago that is still not built, for a vacation, for whatever AND you do not have a ton of equity in your home - take out the money now. As soon as prices start falling lenders can and will freeze the HELOC and you will be unable to get your funds.

Better not to not build the pool and cut back on the family vacation. I don't know how some people do it. I have a subcompact cars and it costs $40 to fill which I do twice every ten days or so. (Granted I do a lot of driving.)

[john3232]

Originally Posted by MN-Born-n-Raised

From the Cromford report:
"The (RE) collapse between April and June is unprecedented - faster and more violent than we have ever witnessed… explosive rise in supply.”

“The contract ratio is telling us that we are already in a balanced market.”

And:

“we have had a very chilly wind blowing through the market.”

“There were just 1,558 accepted contracts during last week, down from 1,898 the week before and 2,274 during the same week in 2021… It is even lower than during the first covid-19 wave in April 2020.”

“We have a full-on buyer's strike developing.”

“more homes are being newly listed for sale than at any time since 2011. The active listing count (without a contract) rose 12% last week…. We are witnessing a full-on seller's stampede.”

Basically, peak pricing occurred in June, not August because the market has changed FAST: From FOMO to a buyers strike. And the PHX housing market is officially at equilibrium. According to the Cromford Report, the median home sale DROPPED 2% in June.

Per Mike Orn: “The stampede for the exit (sellers) is now large enough that it is certain to do significant damage to home values.”

“When a buyer's strike and a seller's stampede occur at the same time, the market stalls in mid-flight.”

Read https://arizonarealestatenotebook.su...m_medium=email for more graphs. My popcorn is popped. It's going to be interesting.

Indeed it has!

[Potential_Landlord]

Originally Posted by MN-Born-n-Raised

From the Cromford report:
"The (RE) collapse between April and June is unprecedented - faster and more violent than we have ever witnessed… explosive rise in supply.”

“The contract ratio is telling us that we are already in a balanced market.”

And:

“we have had a very chilly wind blowing through the market.”

“There were just 1,558 accepted contracts during last week, down from 1,898 the week before and 2,274 during the same week in 2021… It is even lower than during the first covid-19 wave in April 2020.”

“We have a full-on buyer's strike developing.”

“more homes are being newly listed for sale than at any time since 2011. The active listing count (without a contract) rose 12% last week…. We are witnessing a full-on seller's stampede.”

Basically, peak pricing occurred in June, not August because the market has changed FAST: From FOMO to a buyers strike. And the PHX housing market is officially at equilibrium. According to the Cromford Report, the median home sale DROPPED 2% in June.

Per Mike Orn: “The stampede for the exit (sellers) is now large enough that it is certain to do significant damage to home values.”

“When a buyer's strike and a seller's stampede occur at the same time, the market stalls in mid-flight.”

Read https://arizonarealestatenotebook.su...m_medium=email for more graphs. My popcorn is popped. It's going to be interesting.

The pandemic seems to create a whole mini business cycle by itself. What usually takes ~19 years on average we accomplish in 3. This was similar with the Spanish Flu ~1918-21. Mad speculation and inflation turning into a mini-depression. From shortages everywhere to gluts everywhere. We are in a time loop! So my expectation would be for the Phoenix RE market to go back to pre-pandemic prices.

[MN-Born-n-Raised]

Originally Posted by Potential_Landlord

The pandemic seems to create a whole mini business cycle by itself. What usually takes ~19 years on average we accomplish in 3. This was similar with the Spanish Flu ~1918-21. Mad speculation and inflation turning into a mini-depression. From shortages everywhere to gluts everywhere. We are in a time loop! So my expectation would be for the Phoenix RE market to go back to pre-pandemic prices.

I don't think so.
1. The FED's can lower interest rates as fast as they jacked them up.
2. Fannie and Freddie have major skin in the game. This isn't a free market economy at work.
3. We have watched some major inflation going on. The inflation Genie is out of the bottle. And that includes wage inflation.
4. I predict most borrowers are not going to walk from their ultra-low interest mortgages.

The wild card is the Ukraine war. So long as oil is spendy, inflation is semi-unstoppable. So there are forces pushing prices down as well as up. Sure, the pendulum could swing in the other direction and over-correct.

Considering just in 2022 alone, we were having 2-3% price jumps PER month, it was blatantly obvious a bubble was developing. That ongoing war and the cost of energy are going to define how bad it gets. And if it stops, that will help inflation a whole lot more than a punishing interest rate. So whatever eventually happens is way too hard to predict.

I always say "perception becomes reality". Therefore, so long as people think PHX RE prices are going to drop, buyers will go on strike. All I know is we are getting an economic lesson that will make the history books again. It's going to get interesting. If I sold my MN home last year and it sat in the bank, I would have gotten an 8% haircut (called inflation).

[Potential_Landlord]

Originally Posted by MN-Born-n-Raised

I don't think so.
1. The FED's can lower interest rates as fast as they jacked them up.
2. Fannie and Freddie have major skin in the game. This isn't a free market economy at work.
3. We have watched some major inflation going on. The inflation Genie is out of the bottle. And that includes wage inflation.
4. I predict most borrowers are not going to walk from their ultra-low interest mortgages.

The wild card is the Ukraine war. So long as oil is spendy, inflation is semi-unstoppable. So there are forces pushing prices down as well as up. Sure, the pendulum could swing in the other direction and over-correct.

Considering just in 2022 alone, we were having 2-3% price jumps PER month, it was blatantly obvious a bubble was developing. That ongoing war and the cost of energy are going to define how bad it gets. And if it stops, that will help inflation a whole lot more than a punishing interest rate. So whatever eventually happens is way too hard to predict.

I always say "perception becomes reality". Therefore, so long as people think PHX RE prices are going to drop, buyers will go on strike. All I know is we are getting an economic lesson that will make the history books again. It's going to get interesting. If I sold my MN home last year and it sat in the bank, I would have gotten an 8% haircut (called inflation).

I'm sorry. I always forget to mention: in REAL TERMS. I expected prices to go back to 02/20 plus inflation. So let's say we had 20% inflation since then (I'm not sure about the exact #s) and you add that to the 03/20 prices. I think that is realistic. But it's also not yet the top in this RE cycle IMO. The consumer spending cycle should top around 2024. So this is my roadmap: we get a sharp correction into mid 2023. After that we push for one more higher high into 2024-25, maybe even 2026. Then we get another, longer correction as the normal business cycle bottoms out. That would also be a really great buying time.