Home values still going down? Why? (Phoenix, Gilbert: appliances, tax, to live)

[cmist]

Everything is skewed by bank sales, so I would take the stabilization news with a grain of salt. Things piled up really bad from the previous years of being the worst in the country. Now that the banks sales are actually moving due to dirt cheap pricing, it looks like everything is heading up.

However, if you look at the mid range homes from 200-600ish, actually I don't know where to cut it off, but what I mean to say is most other price ranges besides the cheapest, as well as the fire sale stuff is still pretty stagnant.

I'm glad at least something is selling, but I think a recovery will begin when those entry level buyers are parked there for a few years. When that segment can turn a profit and then afford to purchase their move up home, it will free the mid range people up and the market will start moving again normally.

Just my opinion, but I dont think the fact that we are stabilizing based on an abundance of bank sales moving, that are priced at levels that aren't realistic for a normal home seller is anything to sound the alarm about.

[Steerpike]

Originally Posted by Ponderosa

Zillow did not determine the sf. They get data from government records. You have probably been underpaying property taxes for years. Shhhh....

Originally Posted by LordBalfor

Indeed.
My son is a UX Designer at Zillow and it's true - their data is only as good as their source.

Ken

Having been in IT/Software for over 25 years I can think of 1,001 ways they could take accurate govt. data and mess it up.

Regarding my property taxes - in CA, the property tax is based on value of sale not on square footage; when you buy, if property value has increased, the property tax increases correspondingly - not related to square footage.

But out of curiosity, where would I verify the 'government records'?

[crystalys]

Originally Posted by Steerpike

Having been in IT/Software for over 25 years I can think of 1,001 ways they could take accurate govt. data and mess it up.

Regarding my property taxes - in CA, the property tax is based on value of sale not on square footage; when you buy, if property value has increased, the property tax increases correspondingly - not related to square footage.

But out of curiosity, where would I verify the 'government records'?

Whatever county your house is in, try that county's assessors office. Most should be online accessible.

[Huckleberry3911948]

home prices have been stabalized by bailout of banks who sustained losses. temporarily they have a lot of property and no uncovered losses, but there are not enough buyers at the artificial price so the property will become a liability. their next move, blue light special to the chinese. but the chinese are shrewd, they will wait for it to fall truly fall same as rich americans.

[Steerpike]

Originally Posted by cmist

I think housing in Phx is messed up because the jobs available here do not match the pricing.

Things got messed up because of extremely lenient lending. If people weren't able to qualify for a $500k house on a Walmart salary, the people asking those astronomical prices would have been forced to sell for what the true market would bear. That would have prevented the entire issue in the first place.

Now that banks have toughened up on credit, there isn't much of a local population that have wages to match the pricing, and its not like the poor people who bought at the top can actually lower their prices to something realistic without doing a short sale. So this results in a market where anyone that needs to sell is priced based on what they need to clear, and not what its actually worth. Take bank sales completely out of the equation and then recalculate. The issue is rooted in something much deeper than overbuilding.

I don't think anyone should get too excited because statistics misleadingly show the market as "picking up" just because the banks are able to finally dump their once stagnant inventory at fire sale prices. Its about time they woke up and did whatever they had to in order to dump that trash.

The true indicator will be when a person, NOT a bank, can actually sell their home, make a profit, and pay what another normal seller is asking comfortably based on their normal wages and WITHOUT funky financing. Otherwise, the market will remain locked up, even when the bank sales are gone, since the locals are locked out of their own market.

On the one hand, you seem to acknowledge that prices were unrealistically high, a situation aided and abetted by banks being too lenient (your second paragraph, "the people asking those astronomical prices would have been forced to sell for what the true market would bear."). But then you say this: "So this results in a market where anyone that needs to sell is priced based on what they need to clear, and not what its actually worth.". A house is 'worth' only what someone else is willing to pay for it, not what someone paid for it two years ago or whatever. Two years ago, prices were very high; now prices are much lower.

Anyone who bought at the height of the market has two basic options - ride it out and wait for prices to recover, or, sell at a loss/do a short sale/be foreclosed. This really sucks for those people but - it was not exactly a surprise.

[cmist]

Originally Posted by Steerpike

On the one hand, you seem to acknowledge that prices were unrealistically high, a situation aided and abetted by banks being too lenient (your second paragraph, "the people asking those astronomical prices would have been forced to sell for what the true market would bear."). But then you say this: "So this results in a market where anyone that needs to sell is priced based on what they need to clear, and not what its actually worth.". A house is 'worth' only what someone else is willing to pay for it, not what someone paid for it two years ago or whatever. Two years ago, prices were very high; now prices are much lower. .

Yes, you are actually making the same point as me, but my wording was weird.

What I meant was... A huge chunk of the homes here can NOT be priced at what a buyer is willing to pay, or can afford. They are on the market based on what a seller needs, and will never sell at that price.

As long as the conditions make short sales the only way to sell, I don't perceive there is any type of recovery going on.

[GilbertMom]

Originally Posted by Steerpike

On the one hand, you seem to acknowledge that prices were unrealistically high, a situation aided and abetted by banks being too lenient (your second paragraph, "the people asking those astronomical prices would have been forced to sell for what the true market would bear."). But then you say this: "So this results in a market where anyone that needs to sell is priced based on what they need to clear, and not what its actually worth.". A house is 'worth' only what someone else is willing to pay for it, not what someone paid for it two years ago or whatever. Two years ago, prices were very high; now prices are much lower.

Anyone who bought at the height of the market has two basic options - ride it out and wait for prices to recover, or, sell at a loss/do a short sale/be foreclosed. This really sucks for those people but - it was not exactly a surprise.

What, exactly, was "the height of the market?" Our neighbors bought in 2002 for $240,000 (2100 sq. ft, 3-car garage, large lot beautiful pool, excellent neighborhood, granite countertops, etc.) and a realtor wants to put it on the market for $260,000 in 2010, after putting more than 30,000 into the house. Your boy, George, was in charge of the "lost decade." Before the lost decade, money doubled every ten years. So, not only did we lose a decade of value, but we lost the doubling effect as well.

[GilbertMom]

Originally Posted by cmist

Yes, you are actually making the same point as me, but my wording was weird.

What I meant was... A huge chunk of the homes here can NOT be priced at what a buyer is willing to pay, or can afford. They are on the market based on what a seller needs, and will never sell at that price.

As long as the conditions make short sales the only way to sell, I don't perceive there is any type of recovery going on.

You are totally wrong. Real estate agents are trained to value the house at current market prices so that they can effect a sale. It has nothing to do with "what the seller needs."

[GilbertMom]

Originally Posted by amatrine

Zillow says we are down here, but I am seeing homes being sold now, for the first time since I moved here a year and a half ago. Some have sat empty the whole time and now are moving, and I am also seeing properties in the area being improved. People are buying up the bargains and there have been a few good ones. I have seen homes in the upper pricing for this area sell too. (arizona city)

I'm seeing the same thing. All the houses that were for sale over the past two years have sold and the one straggler that was on the market since early 2007, (I saw the family moving out with their four daughters in a UHaul and waved goodbye to nice neighbors who had bought with us in 2000) finally sold for $240,000 (3,570 sq. ft!) this month. Whoever bought it is gutting it and doing a complete upgrade on the interior.

[novaman]

Originally Posted by GilbertMom

You are totally wrong. Real estate agents are trained to value the house at current market prices so that they can effect a sale. It has nothing to do with "what the seller needs."

Gotta disagree. Haven't you watched Real Estate Intervention on HGTV?