Prescott Home Prices Continue to Fall (Phoenix, Mayer: crime, credit, how much)

[DellNec]

Originally Posted by observer53

"All but collapsed"? A bit of an exaggeration. What I read in the Phoenix threads on that subject doesn't fit that pessimistic view.

No exaggeration. If you are a BUYER, then the market is good. If you are a SELLER, then you are in a heap of trouble.

In Arizona, the home values are back to 1997 levels. 1 in 3 homeowners are underwater on their home. Over 70,000 homes were foreclosed on in Arizona for 2010.

Arizona sets another foreclosure record in 2010

The desert heat melts Arizona home prices

Right now you can buy a foreclosed home in the valley, built in 2006 w/ 3,900 sq.ft., 3 car garage, 5 bed/5 bath, granite, tile, fully furnished, for $250K. Mind you that same home sold for $550K back in 2007.

The replacement costs are higher than the sale price of the home. You could NOT build that home for that price even if you did all the work yourself.

Collapse? Definitely!

[Kimballette]

This is the Prescott AZ forum. Please limit your comments in this forum and this thread to the topic as it relates to Prescott, not Arizona in general, nor the U.S. Thanks.

[Esenjay]

For 2 straight months my home price has risen slightly. WEIRD, I must be the major exception in the tri-city area.

[BriansPerspective]

Originally Posted by Esenjay

For 2 straight months my home price has risen slightly. WEIRD, I must be the major exception in the tri-city area.

Prices can vary within local areas. For example, in the Prescott Country Club, prices were $83/sqft from July-Dec 2010 and have risen to $90/sqft from Jan-Jun 2011, which is an 8% INCREASE. Comparing those same time periods for the entire Prescott area, prices of site-built homes have dropped from $101/sqft to $95/sqft, which is a 6% decrease. The same is true nationally, while overall, prices have been declining over the past year, their are pockets that have increased in price over the past year.

[BriansPerspective]

Originally Posted by DellNec

In Arizona, the home values are back to 1997 levels.

By the way, the last time the Prescott area was at $95/sqft was 2001, not 1997. Prices in 1997 were $79/sqft. Sorry to burst your bubble.

[wretched wrench]

Originally Posted by BriansPerspective

Prices can vary within local areas. For example, in the Prescott Country Club, prices were $83/sqft from July-Dec 2010 and have risen to $90/sqft from Jan-Jun 2011, which is an 8% INCREASE.

Are you talking asking prices or selling prices?

Comparing those same time periods for the entire Prescott area, prices of site-built homes have dropped from $101/sqft to $95/sqft, which is a 6% decrease.

Am I correct in presuming that these prices are for site-built homes already built? Does lot size enter into these figures?

[keninaz]

I don't think mobiles count at all. I have to assume site built was what he was talking about.
I had one and was lucky to get rid of it. Banks/lenders of all types would not loan any money on them even when they were on land when the crash hit. And that was in the Spring of 2008 before it got really bad.
I had many people that wanted it and they just could not find a lender.
I had to sell it dirt cheap to get rid of it and the loan.
On top of that the buyer was going to pay a higher interest rate with a bigger down payment than a site built home was going for.
I would never own a mobile or manufactured home again for that reason.

[BriansPerspective]

Originally Posted by wretched wrench

Are you talking asking prices or selling prices?

Am I correct in presuming that these prices are for site-built homes already built? Does lot size enter into these figures?

Those are selling prices for site-built homes averaged across the entire sales area, which is Mayer, Dewey, Prescott Valley, Prescott, Chino Valley, Paulden, Ash Fork, and Yarnell. I would guess that 98% of the sales are in the quad-cities.

Lot size cannot be differentiated in this statistic, because this is an average across all sales. Lot size does not become significant until you drop down to local areas or even single subdivisions. For example, you can buy a house on two acres in Paulden for $100K, but that same house on two acres in Prescott might cost $300K. In a subdivision where all of the lots are 1/4 acre, a 1/2 acre lot will be worth a lot more. In Dewey, a two acre lot in a good water area will be worth a lot more than a two acre lot in a poor water area.

[BriansPerspective]

Originally Posted by keninaz

I don't think mobiles count at all. I have to assume site built was what he was talking about.
I had one and was lucky to get rid of it. Banks/lenders of all types would not loan any money on them even when they were on land when the crash hit. And that was in the Spring of 2008 before it got really bad.
I had many people that wanted it and they just could not find a lender.
I had to sell it dirt cheap to get rid of it and the loan.
On top of that the buyer was going to pay a higher interest rate with a bigger down payment than a site built home was going for.
I would never own a mobile or manufactured home again for that reason.

You are correct. Manufactured homes drop in value, just like buying an RV. Generally, the land value increases to compensate, but not in this market. It's very difficult to get a loan on a manufactured home these days, which drives the prices of manufactured homes down even further. There are a handful of lenders that will lend on doublewides built after June 1978, but even those have to be 'tied down' to qualify. Otherwise, cash is king. Or, you might find the odd owner carryback here and there.

[wretched wrench]

Originally Posted by BriansPerspective

You are correct. Manufactured homes drop in value, just like buying an RV. Generally, the land value increases to compensate, but not in this market. It's very difficult to get a loan on a manufactured home these days, which drives the prices of manufactured homes down even further. There are a handful of lenders that will lend on doublewides built after June 1978, but even those have to be 'tied down' to qualify. Otherwise, cash is king. Or, you might find the odd owner carryback here and there.

Even with cash, a modular became more and more difficult for us. Getting what you want from the manufacturer, going through the (difficult) dealer, getting almost anything approved by the county, add-ons, upcharges finally caused us to finally run away as fast as we could. We ended up having a house built of sticks and bricks.

I think a manufactured home would be OK for some folks who will stick with a factory plan.