‘Too Many Sellers Chasing Too Few Buyers’ In Arizona
Some reports from the Arizona Republic. “Although there is a record number of homes on the market in the Southeast Valley, including about 4,000 in Chandler, realtors say the city is well positioned to hold its housing values. But while the city’s housing market has a lot going for it, it’s still a tough market for sellers in Chandler. The city faces the same problem as the rest of the Southeast Valley with too many sellers chasing too few buyers.”
“The number of homes for sale hit a record 17,550 in the Southeast Valley in July, according to the Arizona Regional MLS. Only two years ago, the last time the market was ‘normal,’ as opposed to overheated, there were about half that many.”
“Realtor Pamela Watson Brown, also of Chandler, said, ‘It definitely is a buyer’s market. But I have been through a lot of buyer’s markets where everything was a lot more affordable. Now everything is a lot more expensive.’”
“She called it a frustrating situation for sellers and listing agents. ‘I have had open houses where maybe I would get one person coming through,’ she said.”
“Even in the Ocotillo area, it’s not easy to sell a house. Realtor Carol Royse, who specializes in luxury homes, said this past week there were 133 homes priced at $450,000 to $600,000 in the Ocotillo area. ‘That’s just too many houses. As a Realtor, how do you pick out what you are going to show the buyer?’ she said.”"
“Homes built in the 1980s or earlier have been losing their values. And those built in the 1990s are not as popular as those built after then, real estate agents say.”
“Struggling Phoenix builder Turner-Dunn, which has stranded home buyers for a year or more after walking away from about 200 unfinished homes in Pinal County, has filed for Chapter 11 bankruptcy protection.”
“The bankruptcy is the latest in a string of problems for the small builder, which pocketed thousands of dollars in earnest money from each home buyer and left homes unfinished for months in Casa Grande and Maricopa. Unpaid subcontractors have claimed they’re owed millions of dollars and slapped liens on Turner-Dunn’s housing lots and in some cases on new homes that buyers moved into a few months ago.”
“The commitment means little to home buyers like Tony Tellez and his family, who’ve waited 18 months for their Maricopa home. ‘We’re jaded,’ Tellez said. ‘That entire neighborhood has a stigmata.’”
“Arizona State University’s plan to move the School of Journalism to downtown Phoenix has hit a major snag. Phoenix officials were forced to start looking for alternatives late last month after the developer, Al Iudicello, failed to give them a guaranteed maximum price for the construction of the ASU space.”
“‘He (Iudicello) also couldn’t commit to a definitive time frame on the condos and the office components,’ Deputy City Manager David Cavazos said.”
“City officials say that the combination of rising construction prices and the Valley’s cooling housing market has made it impossible for Iudicello to build the ASU space for a manageable price. In other words, it not only will cost more to construct the entire complex but the developer also is likely to lose needed revenue if he can’t sell the condominiums because of a glut of similar properties.”
1 - “Although there is a record number of homes blah blah, realtors say the city is well positioned to hold its housing values.
2 - But while the city’s housing market has a lot going for it, it’s still a tough market for sellers in Chandler.
Which is it? ‘well positioned’ or ‘tough market for sellers?’
I defy anyone to tell me by driving through Chandler where it starts and where it ends because everything in the Phoenix area is in the same style. So why is it special again ?
That is so true. The only difference I could see was that there were seguaro cactus in the road landscaping when you drove into Chandler from Tempe.
The article is true. Unless a seller has to unload their property homes being sold in Chandler haven’t seem to drop as much as in other parts of the Phx metro.
Now why anyone would want to pay $300,000 for a 1250 sq ft house which looks like every other home on the block is anybody’s guess.
1/4 million dollar homes are what used to be in rich neighborhoods like Yardly,PA. And the soon will be again.
“That entire neighborhood has a stigmata”
Well now, that IS getting serious.
Sounds like a kin to “conjunctionitis”.
“That entire neighborhood has a stigmata”
Well now, that IS getting serious.
Sounds like a sign of the “End Times”
“That entire neighborhood has a stigmata”
LMAO. You mean their hands are bleeding just like jesus?
Methinks the poor sap meant stigma.
‘That’s just too many houses. As a Realtor, how do you pick out what you are going to show the buyer?’ she said.””
It’s called *work*. You have to be a student of your local market to get your buyers the best deal at any given time. I talked to a lady today who just moved here this week to Fauquier Co., VA from Long Island. She told me she had waived the inspection on the condo she bought, and there were “problems” that she was spending a lot of money on. She was doing my eyebrows at the time, and I realized that I had my face all scrunched up in horror and dismay when she told me to “relax”. I couldn’t believe that in a market with 15 months’ supply that anyone would waive an inspection. GFs are still out there. Sigh.
Figured out FB recently, but still need help with GF. What does it stand for?
Signed,
Newbie
It means “Greater Fool”. I’m thinking waiving an inspection counts. Although major problems (water in the basement) sometimes sneaks past home inspectors so it’s not fool-proof.
I think arizona is lagging behind other places like CA and NV by a few months. It seems to be in the stagnant denial stage right now. But, the word is getting out about these suicide loan products, and soon the sellers will realize that the average buyer can not afford homes over 300k with traditional financing. It may take a while, but the prices in phoenix metro are going nowhere but down.
Peace.
pulled this quote from the post below. of all the demographics to get sucked into these arms, this one really floors me. you’d think they knew better:
“He said he has had a string of elderly clients come to him for help after lenders placed them in adjustable-rate, interest-only or option loans. He said these borrowers did not understand that they had placed themselves at risk of losing their homes. Dowling said he has met people who had owned their homes free and clear and who lost them to foreclosure after taking out these loans.”
Just looked at the updated pics. Ponderosa Trails in Flagstaff… 400k???? what??? outrageous.. Those homes SHOULD be 160k… 200k tops.
Property Lader just had a new show were the flippers did not sell the home (atleast during the show). One neighbor stopped by the open house (who was also selling her home) and said if some one makes an offer, than take it. They also commented how there were 77 homes for sale within a mile radious and 13,000 homes for sale with only 1,300 selling the month before.
It looks like even the slowdown is starting to show up on prime time!
I just saw that one, too. More details: a 21 yr old Sacramento couple who thought they could flip a few houses to make enough money to buy one they will eventually live in. They knew absolutely NOTHING about flipping, had jobs as a med assistant and warehouse manager (I believe he quits his job somewhere along the line to spend more time on the house). Their budget began at $30k and increased to $40; they did not have a physical inspection before buying so there was dry rot throughout the entire house; after a $3000 plumbing job, their plumbers made made major errors so the guy had to have his bro-in-law help him correct the problems…after 2 previous tries, they finally passed plumbing inspection on the 3rd try. Dad comes in also to help build kitchen cabinets. They went with GCT although the wife didn’t want or like them. Turns out that the RE agents liked the kitchen a lot…of course…everyone is on the GCT track and they can’t see past it.
After buying this shanty, er, house (2/1) for $185k in a not-so-nice area of Sacramento (El Paso Heights), sinking $40k and 3 months time into it (includes 3 mortgage pymts), they thought a price tag of $279k was good. As the show was going off, we find out that they got an offer of $255k. If it cleared escrow, they would only make about $10k.
These kids were really not prepared for such an undertaking. And they admitted that they had not paid enough attention to the market.
BTW, this was a new, 2006 episode. I wonder how much longer they will show these kinds of outcomes? I’d LOVE to see more of these hit the stv creen so that potential flippers will see what they would be up against. Like the couple in this epi, too many people really don’t know what’s going on in the market….they just hear or only pay attention to the “success” stories and think they can do the same thing.
BayQT~
Yes- the guy decided to leave his job to finish the flip. It looked like his wife was close to tears when she talked about it. Of course ealier in the show he had talked about almost getting fired for taking too many phone calls at work, so maybe it wasn’t entirely his idea.
Yeah, that’s right. I forgot that part. It could be that he was given the “option” of quitting or getting fired.
BayQT~
This isn’t Arizona but check it out! I’m sure this town is nowheresville but the house is nice for the price.
http://dallas.craigslist.org/rfs/196314934.html
Nice find. I did a little google space viewing and it seems like a very small city or town out in the middle of nowhere. Well there is a larger city within driving distance but going to the beach looks like a bit of a drive.
I wonder about the local economy if something like that is so inexpensive. Looks very well maintained.
What local economy? It is in the southeast corner of the state. I’m sure they wouldn’t mind if you wanted to live there, but I doubt if you could find anything but the most rudimentary employment.
All I need is a broadband internet connection and a reliable phone system for work. But I like a lot of other things for living life.
Er, southwest corner.
I love the house but it’s way, way too big. When I buy again (if ever) the house will be about 1800 sq feet MAX with an unfinished basement.
I read a story somewhere that said it is good for kids to share rooms as it teaches them social skills.
I grew up in a family of 7 kids,always had 2 room mates. Got my first single room in grad school. never had the “space issues” other kids have.
The reason it’s so cheap is property taxes in Texas are very high. Check the taxes on the property.
Taxes are $1040. Seems pretty cheap to me.
That property is in some out in the boonies place in Minnesota not Texas.
Txchick57, It’s nice, but my own personal taste is modern furnishings. Not antiques. I would modernize it. Just me. I like living in 2006, not 1906.
Wow…5,000sq for $149k. And good looking too. Sioux Falls is fine, good hospitals, and jobs as well for professionals. House might appeal more to women, very romantic style decor. Guys need black leather sofa and a big screen, both notably absent in pics of that home! And probably a bitch to heat in the winter, perhaps get a big kicking wood stove? That might be the only solution to actually have warm feet in a Dakota winter….Thanks for the link…
Ever seen the movie Fargo? Relative garden wonderland compared to Adrian, MN. Little boring dying town where all the kids that can, move away. Millions of Flies, shaded porch walls, daily 30mph winds, pool table flat, unlimited corn and soybean farmland, only trees are those planted around housing as windbreaks - looking like little islands of green in anotherwise unremarkable landscape. Winter temps in the deep subzeros (better have some felt-lined boots), no lakes, no rivers, no jobs ‘cept farm work. I am not exagerating. Our school bus was equipped with a plow to cut through the snow drifts that piled to several feet in places. Closest employer of any significance is Campbells soup plant (industrial scale chicken slaughter 24/7) in Worthington 20 miles east. I spent 2 of the longest years of my life there in the ’70’s. High school at Adrian High (consolidated school district, 25 mile bus rides were common). Sioux Falls is 45 miles away and trust me in the winter you are talking a long, potentially dangerous drive. Had moved to Adrian from northern Maine, thought cold didn’t bother me, Adrian at -15 was much worse than Maine at -30.. When we lived in Adrian there were so many abandoned farmhouses the owners would almost let you stay there free just to have someone around… Think long and hard before you go. I would rather live in a garage in norcal than the 5000sq/ft chamer in Adrian BUT just my opinion, I am sure there are plenty of people who’d love to live there…just not me.
Nice looking place. Cold, snow though. I was up that way (but not this particular place) a few years ago. In Feb. Didn’t warm up the whole week. COLD.
Some of these old mid-west towns are dying. I’ve seen a few that look like ghost towns.
The towns here in the Ozarks (SW MO, NW AR) have been booming (relatively). But even here things are slowing down. My gym instructor was studying to be a real estate agent 4 months ago…on Friday he told us he quit studying…market’s dead.
I’m in the same area (SW MO, Bull Shoals lake). Anyway, about the only thing really still moving is raw land but my thought is that this is being purchased by equity nomads with the idea of building on it. This will probably dry up right about now due to slow down in the high end states they are moving from (perhaps unable to sell for the amount necessary to build?). Still though, there is a lot of building going on here from last year’s equity bandits moving here. I expect that this area will crash in the spring.
Interesting…that Carol Royse. I went to an open house she held back in late ‘04. It was a high-end neighborhood(Whitewing) in Gilbert. WHAT A SNOOT! Anyhow, I went to another one of her $1.5mil listings in West Lake Estates (also in Gilbert) just last weekend. This time one of her assistance was holding the open house. Much to my amazement, this person was polite, friendly, and charming. I left this agent my contact info and now I can’t shake him. Its only been a week.
I guess you’re a chased buyer right now. I can just think of these funny thoughts or cartoons where you’re driving along the highway and cars
pull up on your left or right with a picture of a house, a price and a phone number in their window once they find out that you’re a home
buyer.
What’s funny is that I explained him at the open house that currently we were just browsing and expecting a market correction to the downside. Later, via email, I reiterated to him that we were not buying until we saw confirmation of a bottom in RE. Apparently, this is not a deterring him.
“I guess you’re a chased buyer right now.”
A new acronym for the bubble has formed. CB!
It’s funny how just a year ago the buyers laughed at people who are renting and have no debt. Who’s crying now?
“She called it a frustrating situation for sellers and listing agents”
Frustrating for buyers who don’t want to get ripped off! Choice now is buy and lose or wait. Pretty much a no brainer!
What’s happening in Prescott, AZ?
In my little corner of Chandler, prices might be headed down. The reason I say “might” is because nothing is selling. Houses that were selling for $400K (2300 sq ft) last summer are being listed at $365K. And still a long way to go to reach the $185K they were selling for in early 2004. And even further to get to the $125K they sold for in 1999.
Of the 6 guys on my street that work in construction, 4 have now moved on to either TX or New Orleans, leaving empty houses behind. Two of the for rent signs are so weathered that you can’t even read the phone number any more. Just found out yesterday that two of neighbors that I hang out with are equity withdrawl monkeys. This neighborhood is going to hell in a handbasket. Thank God I’m just a renter and can leave it all behind if things get worse.
That entire neighborhood has a stigmata
Hah. Maybe if it had THAT, houses would fly out the door.
“Homes built in the 1980s or earlier have been losing their values. And those built in the 1990s are not as popular as those built after then, real estate agents say.”
When are people going to understand that when you buy a home in a place with empty land as far as the eye can see, the houses are like cars. No one is going to want your 2001 model come 2007 since there is something better on the market. I was looking to move to Northern Colorado and new 3 bedroom homes there have separate bathrooms and closets for each child’s room. and the minimum is a shared bath between the two bedrooms with a separate master bedroom suite that is like a high end hotel. if you are trying to unload your 1980’s home you can’t compete. it’s not NYC there.
Older homes are almost always on bigger pieces of property. New homes are too close together. I live in Ahwatukee in Phoenix. Its a neighborhood of cement and blacktop. Gets real hot during the day and radiates back heat all night. Fortunatly I rent, I would be unhappy to own this place. I don’t think my neighbors have ever cleaned up thier two pit bulls dog S%^t the whole time I have been here. They are renters also and you know what they say about renters
In Cali I owned a Townhome and come to think of it all my neighbors had dogs also in even smaller yards. Ahhh the smell of dog S%^t seems to follow me wearever I go, and the flies. Love thoses flies.
So yes, I buy again and its going to be on a big lot I don’t care if its all rock and cactus, I am so sick of f%^&ing flies and F5^*& dogs that are not cleaned up after.
Ha!
Hey Cactus! I agree with you about big dogs. I live in ahwatukee near 42nd (and I rent). Yes, maybe we are neighbors. My sister has a small dog and is very conscientious about dog doo. When she takes the dog for a walk, she takes those plastic bags with her, cleans up after the dog, and tosses the poop in a nearby can. My sister says most people are slobs and don’t clean up after their dogs. It attracts flies and diseases. She is right. Most people around here are slobs, but it’s not local to Phoenix. It’s America. People are sloppy everywhere and don’t care about how their lifestyle destroys the lifestyle of other people. For me, I never walk on the grass because most people have dogs. I see people at Sun Ray park roll around on the grass in the winter and I laugh at them.
Yes we are neighbors, I’m near 44th. I’ve been to Sun Ray park on Ray road and hiked up that little hill there, nice view.
Yea I’m going hold back on rolling around on that grass this winter as well, thanks.
I think my dog problem was worse back in Cali because I lived in a Townhome. Almost everyone had a dog or two and we had such small patio yards. Barking and flies and dog crap all over the common areas. Acually its better here so I’m moving in the right direction as far as the dog - flies and roof rats go.
Yes we always had a roof rat problem in Moorpark Ca. The rats loved that dog food. 16 years I lived there in that Townhome.
I saw the HOA go from 118 a month to 338 a month. That was enough for me. Those Townhomes will be a hard sell with that HOA if we get a significant downturn in RE.
Have you noticed it seems one realtor has about half the homes listed here in Ahwatukee, Patti Vaught. I see her signs all over. A few sold signs as well. I will have to Zillow those to see what they went for.
I have no plans to buy until rent = what it would cost to buy.
I banked my equity in CD’s and Money market funds and I beleive it just about pays my rent. I like Tucson more than Phoenix anyway. Cooler weather and nice mountains. I will wait and see if any RE bargins show up down that way. Looks like Tucson is taking a downturn if I read the SDIC investors board correctly. However Vail is not high on my list of places to be in Tucson. San Diego Home owners got equity loans out and bought up that area and some other remote places in Tucson. Now they are stuck. I don’t think there are near as many jobs in Tucson as Phoenix ? Not sure what they were thinking when they bought? Sell to retirees?
Haha, I just remembred a big tarp like sign as I was traveling down the 10 into Tucson last weekend, Somthing like ” California buyers see what we have got for you blah blah ” I couldn’t catch the rest as we sped by. amazing. It was before speedway as we headed south and on my right. it looked like manufactored housing or something? I wanted to go back and take a picture but didn’t get around to it. You see it would match the big billboard sign I used to Pass on the 101 in Ventura Cali that said ” buy Arizona Real estate now!”
I used to live in Tucson after dumping my California house in 1996 (20% loss in the last bubble). Tucson has Ratheon. I had great times at Raytheon. But found out about consulting and made more money by leaving a salaried job. However I do intend to move back. One of my safe deposit boxes is in a bank in Tucson, so I do have connections there! The air is cleaner, the city is quieter. I prefer the northwest and lived near the Foothills Mall.
53,300+ houses for sale in Maricopa County!! Every week we’re hitting record inventory.
This blog has saved us from a very, very bad mistake just in the nick of time! I just accepted a job offer in Phoenix and we were bracing ourselves for having to empty out our savings and stretch ourselves as far as possible to buy a decent home, when I stumbled on this blog (after seeing a story about it and Ben on, I think, either the MSNBC or CNN webpage). Thank goodness! I feel like we have really JUST dodged a bullet. We are now looking to rent in Phoenix, and expect to wait until house prices stabilize to buy … that is, if we ever buy in Phoenix at all. Thanks to all of you for your advice, and many, many thanks to Ben for creating this blog!!
Our problem is now to just figure out where and when to rent. I will have to commute daily to the southeast corner of Glendale. We have always bought old houses and then restored them, but we are not flippers. We’ve always actually lived in the houses we buy, and we have only ever bought what we could afford (so we’ve always lived in working class areas). We realize there is no actual old housing in Phoenix, and am sad to think we must live in some sort of McMansion on a postage-stamp-sized piece of property. We would like to find a safe neighborhood with large lots, and a manageable commute. Any suggestions of where to look?
One other question: We’re new to this blog, and this topic of discussion, so please forgive if I ask what exactly “FB” stands for? Initially I thought “First-time homeBuyer,” but now I’m thinking something more along the lines of “Flip-Buyer.” Am I wrong on both counts?
“FB” stands for “F*cked Buyer.” Ha!
Good luck on finding a place to rent. I go for the most expensive place to rent if I go at it alone, but I share a place with my sister. She can only afford so much. If you are in Phoenix now, go into an Albertson’s, Basha’s, Fry’s, or Safeway supermarket near one of the entrances and grab teh Greater Phoenix Apartment Guide. It’s a small booklet of apartments and condos for rent. I cannot recommend anything otherwise. Here is a web site that rates apartments: http://www.apartmentratings.com/rate/AZ-Phoenix.html But I will forwarn you that if you see posts on the same day as other posts (yes or no), it’s usually by one person. The web site is not good enough. Not enough people put in ratings. The apartments to look for are those with at least 30 reviews and at varied times, not seemingly by the same author. Then go for the highest percentage of approval rating. Here’s a Glendale link: http://www.apartmentratings.com/rate?a=vccbc&state=AZ&city=Glendale&name=null&sort=rec&order=2
“We realize there is no actual old housing in Phoenix, and am sad to think we must live in some sort of McMansion on a postage-stamp-sized piece of property.”
There is old housing in some places–my home in South Phoenix was originally built in 1912, though you can’t tell from the front (the living room and upstairs master bedroom were added in 1993). There are older homes (brick and block construction) on larger lots (1/4 acre to multiple acres) in various locations in the Phoenix metropolitan area, including horse properties. There is some old housing on nice-sized lots in downtown Glendale.
Pricing is all outrageous now, but there are a lot of nice older homes–downtown (Encanto, Coronado, Willo districts), the Central corridor, around Camelback mountain, etc., if you know where to look.
I work in an office building in the Arcadia area. Our meeting rooms look out over Camelback Mtn. If not for the dirt covered mountain, you would not think you’d be in a desert if you were blindfolded and placed where I work. The trees are 3 stories tall, people have green lawns, and the yards are huge. There are some nice looking houses. But it’s part of the area where the baseline killer struck. Scarey at nighttime. In the daytime on weekdays, I enjoy lunching with co-workers and gazing at the pretty young professional women at Pei Wei’s or Chipotle’s or Starbucks. Not sure If I would buy in the area when I’m ready to buy. My target year is 2011 and I may be buying in Portland.