Buyers Have ‘Pick Of The Litter’ In Arizona
A pair of reports from Arizona. “For the first time in a long time, it’s a buyer’s market in Tucson. Realtors say they haven’t seen this many homes on the market in years, and that means prime real estate for first time buyers in the area.”
“Those in the market have the pick of the litter these days in Tucson. ‘Tucson has too much inventory, but that’s great for the buyer, so I would consider this a buyer’s market certainly,’ says Realtor Andrew Moya.”
“‘For sale’ signs are hanging outside about 9,000 homes in Tucson right now alone. Moya says, ‘With 9,000 homes, the seller has to realize, and is realizing, the first-time buyer is an integral part of this market.’”
“‘The incentives are really big right now with a lot of the home builders,’ says Moya.”
The Arizona Daily Sun. “Flagstaff’s overheated housing market has finally cooled off. Home sales inside the city fell from 152 units in July 2005 to just 84 last month, a drop of 44 percent. For the first seven months of 2006 vs. 2005, total sales are off 24 percent.”
“Houses are also taking longer to sell. That’s probably because there are more houses to choose from: 794 were listed for sale inside the city last month vs. 254 total listings in July last year.”
“Realtor Ann Heitland said the increase in the number of single-family homes on the market is a sure sign of the transition from a seller’s market to a buyer’s market. Heitland said the city has almost 10 months’ worth of homes for sale locally, three times last year’s number at this time.”
“But some Realtors refuse to call it a buyer’s market, pointing to other economic indicators that have not been triggered. Steve Brighton isn’t ready to call Flagstaff a buyer’s market. Even though there has been decline in the number of homes sold, the price continues to climb.”
“Michael Kerski, the city’s community investment director said sellers are still getting nearly what they ask for, another indicator that suggests Flagstaff has not become a haven for home buyers, yet. Using NAAR statistics, the average price of all homes sold this year in Flagstaff is between 97 percent and 98 percent of the average list price.”
Prime, OVERPRICED, sh*tboxes! Lucky first time buyers!!
Phoenix
7/20/2005 10748
7/21/2005 10968
7/22/2005 11122
7/23/2005 11424
7/24/2005 11338
7/25/2005 11112
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Insane. And they’re trying every trick in the book to move that inventory. Every trick that is, except lowering the price (at least for the moment, a short, short moment I think)
Thanks—I’ve missed seeing this always astounding list over the past couple of weeks.
Amazing. 0.41% PER DAY! Every first of the month, a 1/2 percent (or greater) drop in volume, then the inevitable build until the next first of the month. Great data.
nice. music to my eyes.
Who are the subprime lenders in Phoenix?
I would like to buy some puts on them.
Just for fun, I plotted those inventory numbers in Excel. If the trend holds, the inventory will peak at 160,000 and not drop back to its starting point until 2019! Of course, I don’t believe the trend will hold as prices will drop more dramatically soon and sales will start to increase as a result.
Thanks for posting that. It says it all, doesn’t it.
Here’s the Flagstaff numbers taken from the MLS website every few days (I’m not a realtor). I have the numbers in an excel chart on my blog if you just want to see the pretty upward sloping line. Looks a lot like Phoenix’s chart.
2/20/2006 460
2/22/2006 470
2/25/2006 472
2/27/2006 483
3/4/2006 488
3/6/2006 491
3/8/2006 507
3/9/2006 514
3/11/2006 512
3/12/2006 513
3/14/2006 518
3/15/2006 521
3/18/2006 522
3/21/2006 531
3/31/2006 555
4/4/2006 551
4/6/2006 560
4/8/2006 561
4/16/2006 601
4/19/2006 613
4/23/2006 615
4/25/2006 621
4/27/2006 618
5/5/2006 639
5/8/2006 645
5/14/2006 670
5/22/2006 701
5/28/2006 752
6/3/2006 745
6/4/2006 746
6/7/2006 772
6/10/2006 788
6/13/2006 802
6/16/2006 813
6/21/2006 817
6/25/2006 830
7/1/2006 836
7/8/2006 848
7/11/2006 845
7/13/2006 856
7/15/2006 859
7/19/2006 871
7/22/2006 881
7/26/2006 894
7/29/2006 893
7/31/2006 886
8/1/2006 879
8/5/2006 899
8/8/2006 897
8/10/2006 910
8/12/2006 943
8/15/2006 949
8/16/2006 946
8/18/2006 949
8/20/2006 949
8/21/2006 952
Like so many before, the folks in Flagstaff are hiding behind the median statistic. Check out the local for sale ads and for the price reduced, etc. Notice the new homes at Ponderosa Trails, which are in the new pictures in the photo gallery this weekend.
Ben, those pictures you posted from the Flag area just made me sick. Tearing up land to build that garbage and then trying to sell at ludicrous ripoff prices. Total turnoff.
Another as yet unmetioned aspect of the madness of the bubble. The stuff that’s been built over the last 5 years is nothing I’d ever want to live in personally. The “Product” that will sit on the market will not appeal to the people interested in buying. It gets worse because both the planners and developers are likely to use this “crisis” to push an agenda of cheaper homes with lower quality and higher densities, aka even less desireable.
Robert C,
Well said. My wife and I agreed that we would prefer to look at homes built “pre-bubble” and would actually take it a step further by eliminating homes that were either re-sold or even re-fi’d from say 2001 on. As we peruse flippersintrouble.com it’s incredible to see the sheer amount of turnover those properties have been through in just the last 36 months! Why would anyone want to join that fray? You’d also mentioned that your “older hovel” (for all it’s faults and lack of the latest building technology) is infinitely more energy efficient than your more contemporary neighbors. To me better building techniques and meaningful advancements would tend to imply that central air conditioning would become unnecessary or at the very least only needed on the hottest of days. Whenever we visit friends in their newer homes it seems that their A/C is constantly running or cycling. Not so good for the pocketbook.
Any home built within the last few years is much more energy efficient than older homes. A simple review of the building codes will tell you the same. Anyone building in California, for example, will run right into Title 24.
Ironically, many argue that the current “mold problem” is due to better home insulation, with little to no air exchange without mechanical ventilation in newer homes.
You have no idea. It is better to remain quiet than to speak out and reveal one’s ignorance. DinOR have talked about this subject at length in other forums and he was just reitterating. Building “codes” are indeed far stricter but the “result” has been far worse energy efficiency. It is almost impossible to build for efficiency because of codea and planners. Density mandated by the evil US planning cadre precludes things like passive overhangs, site orientation, green cover, passive ventilation, thermal massing, and a host of other time tested techniques.
Building a R-24 two story stuccobox with no eaves, two story living rooms, open floorplan, slab built on tiny lots with big driveways and big sidewalks and big streets and no room for greenscape may make the planners happy but it weastes energy. Califronia energy reqs are like the early days of EPA fuel efficiency ratings.
What about Phoenix and their artificial lakes. Now they get humidity to cancel out that “dry heat”.
Two-story stuccoboxes with modern windows, doors, and insulation are still more energy efficient than 1960’s overhung, oriented, green covered, “passive insulated,” crap boxes (as if they were properly oriented). You’ll get no argument from me on the evils of the modern planning department, though.
Where did you get your engineering degree such that you feel the certitude of this claim? You just plain old don’t know what you are talking about as to the science despite your perceptivness as to the political issues. It isn’t even your fault. The planners and developers have been pushing for some really weird sh!t about using energy. Yeah, replacing an aluminum single pane with a fuly insulated e-glass double pane vinyl will take rhe R-value from 2 to 8 but then they change from 2×3 to 4×6 windows and lose more than they gain. And what about construction? Freakin’ 2×3s that measure 1-11/64th by 2-30/64ths with maybe 6 growth rings? We used to call those grape stakes. Oh, and plaster over browncoat vs taped 1/2 inch gypsum? Don’t make me laugh. Look, I got 2600sf in SoCal with a tiny wall heater and no A/C. I have neighbors who pay 6x my electricty bill.
Don’t get me wrong, If I retrofitted with e-glass, weatherstripping, humidity controls I could save a lot with modern building materials but what has happened with new construction is that the new materials and techniques were used to build in stupid places with cheaper methods and in less efficient patterns. When you cut down all the trees, fill in all the canyons, chop off all the hilltops and push the density you get urban heat island effects and disrupt microclimates and expose more habitable surface area in each structure to the elements.
I take no joy in exposing you claims but understand the new regulations do not result in modern homes using less energy, only using less than they would if built for lowest cost.
I live in Western Washington and there are a seemingly unlimited number of eyesores popping up everywhere. It is really unsettling and I have wanted to call the local planning department which issues the permits and ask why this is being allowed. They really junk up old “quaint” neighborhoods. And one only needs to take a brief look to realize it is just another spec home thrown up by a builder (used loosely) who probably did not even use an architect and has absolutely no style. They use cheap small windows which are not only disproportionate in size to the structure, but are also misplaced. The homes are literally one big boxy rectangle. Every material is the cheapest available. The quality of the construction is shoddy at best. There is no way these homes are going to last 50 years let alone 100. It boggles the mind.
These ARE the planned developments that your local planning cadre is pushing. Planners hate quaint old neighborhoods. Nice places don’t need planners, screwed up places need planners. The full planner employment part of the agenda. Trust me the more you get a gut dislike of any project the more likely there was substantial planner involvement.
ditto on the pictures. i see a lot of what used to be beautiful arizona landscape in the background. i’m no tree hugger, but it sucks to see box houses like that
I posted two comments yesterday below that Az Daily Sun story. They still haven’t shown up. Wonder why… I made some comment about how they completely screwed up the definition of a buyers market: it’s too many SELLERS. I also added that the slowdown will probably occur as the “equity refugees” stop showing up because their own homes aren’t selling or they can’t tap their declining equity. I mentioned that the buyers aren’t buying yet–maybe when prices return to more sane levels (pre-2003?).
Flagstaff locals don’t make much money, something like $30k median, so that places median home prices at about 10X earnings. No fundamentals there at all–just rampant greed and gold rush mentalities.
Flagstaff is relatively small, too, (50-60k) so the local rag tends to support the real estate/Chamber O Commerce/contractor crowd. I was actually surprised to see them report the bad news, but of course they spun it up to be more positive than the real story. I keep checking the NAAR website for residential listings and the total keeps ticking upward day by day.
On topic, but different state. This story I heard from a co-worker illustrates how close the Idaho market is to becoming like Arizona.
A co-worker said her brother-in-law is stuck with four house payments right now. He bought four pre-construction homes for over 400k each around Boise with the intent if flipping them. He’s now trying to sell one home back to the builder for a 65k loss!
The moral of the story is the bubble is bursting rapidly across the US and people hold multiple properties like above are going to cause a stampead out of the market as they begin to dump their holdings.
Thanks for the story! Yikes!
No “Compasion” for this guy….
The girl I work with said he was in it for the money and got cockey. Now he is stuck with four houses on the market.
oh man thats going to hurt. The over 400 market is really slow.
65K loss is huge. Try saving for that amount, see how long it takes.
Assuming $500 per month, it’ll take 11 years, from now to 2017.
Now multiply it by 4, it’s 44 years.
The moral of the story is the bubble is bursting rapidly across the US and people hold multiple properties like above are going to cause a stampead out of the market as they begin to dump their holdings.
So true. BTW, it’s stampede, I think.
stam·pede Audio pronunciation of “stampede” ( P ) Pronunciation Key (stm-pd)
n.
1. A sudden frenzied rush of panic-stricken animals.
2. A sudden headlong rush or flight of a crowd of people.
“‘For sale’ signs are hanging outside about 9,000 homes in Tucson right now alone. Moya says, ‘With 9,000 homes, the seller has to realize, and is realizing, the first-time buyer is an integral part of this market.’”
That’s too bad, since according to realtors anyone who didn’t buy last year was going to be priced out forever.
Too bad for them that we cozy little renters are just going to hang out a LEEETTLE while longer JUUUUST to find out who’s right about this real estate bubble thingy. :
Make sure that you DON’T BUY.
I was in Flagstaff a couple of years ago and am floored that housing prices would increase there. Nice volcanic landscape, not Hawaii though. Is there some economic base I do not know about?
Flagstaff has been hit hard over the last 5 years due to lack of snow for a less than mediocre ski “resort”. It’s about the only reason to go there, other than a beer festival and a few golf courses or an escape from the desert heat.
My wife owns a house in Cheshire. I own a house upcountry Maui. IMHO I find both places alike. Both are small islands of beauty surrounded by crap. Maui is surrounded by water. Flagstaff by desert and scrub.
Actually,
I like Flagstaff. Lovely spot. It’s only major problem is equity locust. For the local’s sake, I hope it gets to 20 below for a couple weeks this winter to chase those roaches away.
For Josy Payan, her dream which is now a reality, cost her $160,000, and it’s the first time she’s ever been able to own anything like that.
I can’t count the number of articles I have read that stated (sic):
“You see? Someone bought a house so the market is doing great!” As if I am going to take advice from Ms. Payan. I bet she put nothing down and will be lucky to make the payments for a year. Just a guess, but with the incentives they threw in it is quite obvious she has no skin in the game. This should be illegal.
(rant on) Okay, in fact, they say she bought a house? She didn’t buy a house, all she did was sign some friggin’ papers. They should go back to the builder and take it out of his a$$ if she doesn’t pay off that note. As a matter of fact, he should be boiled in hot oil if she misses a single payment within the next three years. This housing “market” is a joke. The taxpayers are going to suffer for these damn shenanigans and it pi$$e$ me to no end gosh darn fratter beratter, frickin’ frackin low life damn scum sucking reic blast it!!!…(rant off, not really)
Well, I don’t know about a buyers market… Here in Tucson homes have been dropping in price by about 10%. We looked at a home last week down the street from where we are renting. The seller reduced the price about 8%. We asked for an additional 3% reduction. They walked and so did we. They were only willing to throw in 200.00 to split the cost of a home warranty. They bought the home three years ago for half of what they are trying to sell it for now. In this particular neighborhood the price on this same floorplan has a 50,000 price difference, and the price difference has nothing to do with upgrades. Our rent is less than half of what our mortgage would be. Looked at a spec home, bare bones cracker box. Builder offering a 40,000 “incentive”, we offered 20,000 less. Even if our offer was accepted,(which it wasn’t) we would have walked,(had a viewing barrier vs. a wall facing the wash) not so safe with two little ones. Some builders in the area are offering agents 10% commission. This is no buyers market. I’m a potential buyer and feel very frustrated. I’m patient though. I’m bitter enough about this market to stick to my guns. We were in Chicago for school happy to return to Arizona the home of affordable housing to only watch the market flood with bus loads of investers from Tennesee buying the homes I had wanted and jacking the price above my families affordability. I grew up in Tucson, lived in Gilbert during the first two years of the housing boom, watched people burn there equity on boats and TV’s while others sold there houses at peak and paid off all student loan debt, line there bank accounts and rent. It has been interesting to say the least. My hope is that patience will be rewarded in the form of a home that will fit our families needs at a price that ensures our ability to save for our future. Thanks to all who contribute to this blog. You have made a difference.
What are rents like in Tuscon on SFR’s?
Our rent is 920.00 a month for a three year old 1428 sqft home in a gated community up against the mountains. A 2500 sq foot home a block a way built less than a year ago is 1200 a month. In less desirable neighborhoods rents range from 300.00 a month to 700.00 a month.
At these rents, why the need to buy?
Well, we have moved so often in the past few years. I love Tucson it’s my home. We would like to feel settled. At this point it’s more psychological than anything else. Though we have loved the financial freedom renting has provided us. We are willing to spend a little more to buy,if we find a home we love. All part of the American Dream I suppose. In the mean time we rent, save, travel and have plenty of family time. Our stress is minimal-priceless. Not willing to sacrafice all that for an overpriced piece of stucco. Actually we are not willing to sacrafice all that for anything. We don’t take our life for granted.
“All part of the American Dream I suppose.”
Don’t buy into the “American Dream”, buy into your dream. Peoples decisions are too often influenced by “what the others would do.” This herd mentality is a lie, fed by peoples insecurities and their willingness to be decieved. Dare to be different!
You should be in no hurry to buy in this situation. All the RE pressure points have faded into memory. Priced out forever? Nope! Hurry before rates go up? Nah! Running out of land? Please! The way I see it you’re one of the lucky ones that have the ability to sit tight. Prices are dropping, rates are holding steady, and with inventory doing what it’s doing, you’ll have the home you want instead of the home you would’ve settled for. Wait it out my friend.
Rent two. Silly right? Think about it. This is exactly what homebuyers were doing. $920/mo implies $100k prices. Let me guess, currently wishing prices are about $230,000? What would people be saying if the situation were reversed and renting were twice as expensive as owning? $3500/mo or $50,000 selling prices!
Patience is your friend right now Ddweller………
Wow. I pay $775 for a crappy 1 bd apartment on the second floor in an old 1950s building. And even then, I thought it was a steal for the area (near San Jose, CA). I would love to have a house with a garage for that same price, even if it wasn’t a nearly-new 3 year old home, or even if it wasn’t in a gated community, or even if it didn’t back up to a mountain.
Our rent is less than half of what our mortgage would be.
Dude! Keep renting!
I am.
These 30, 40, 50% drops in sales must be just killing the RE industry. Median increases or not, a few more months of this and ‘the’ story (at least from realtors association point of view) will be the number of distressed agents, loan officers and brokers. These slowly unfolding events are memorable ones, a kind of ‘yeah, I lived through time, son. Let me tell you about it.’ What a change. A year ago, agents were crying about too few homes to sell, envisioning the riches to be had if the volume wiuld just spike. It did, and it’s their worst nightmare - they threw the party and nobody came.
Edit, edit you dumb…
“These 30, 40, 50% drops in sales must be just killing the RE industry.”
And the big brokers REMAX, Century 21, etc. have all had to increase advertising. Look at all the TV advertising, must be costing them a fortune. They will have to start closing offices.
It’s still the hope of realtors that it’s a buyer’s market. Actually, there is NO MARKET. It’s best to rent now.
…”real estate for first time buyers in the area.”
…”the first-time buyer is an integral part of this market.”
Things are going to be real interesting on this point. With home ownership hovering near record highs, 0 down, an lax lending standards, there just may be no first time buyers around (myself and other bubble-rati excluded of course).
The unemployment rate ticked up to 4.7% in July from 4.4% in June, 2006 in Arizona
Lower employment and dramatic increase in number of listing equals “the crash is coming” Stay tuned
Following are U.S. seasonally adjusted regional and state
unemployment rates:
July June May April July
/State 2006 2006 2006 2006 2005
Alabama 3.9 3.6 3.6 3.6 3.9
Alaska 7.0 6.6 7.1 7.0 6.7
Arizona 4.7 4.4 4.2 4.3 4.8
Tucson
2-Sep-05 3470
6-Sep-05 3544
7-Sep-05 3582
8-Sep-05 3602
9-Sep-05 3625
10-Sep-05 3660
11-Sep-05 3695
12-Sep-05 3737
13-Sep-05 3762
14-Sep-05 3756
15-Sep-05 3792
16-Sep-05 3830
17-Sep-05 3847
18-Sep-05 3843
19-Sep-05 3852
20-Sep-05 3839
21-Sep-05 3847
23-Sep-05 3867
24-Sep-05 3901
25-Sep-05 3937
26-Sep-05 3940
27-Sep-05 3956
28-Sep-05 3955
29-Sep-05 3962
30-Sep-05 3996
1-Oct-05 4014
2-Oct-05 4020
3-Oct-05 4035
4-Oct-05 4047
5-Oct-05 4075
6-Oct-05 4114
7-Oct-05 4152
8-Oct-05 4172
9-Oct-05 4175
10-Oct-05 4203
11-Oct-05 4235
12-Oct-05 4251
13-Oct-05 4248
14-Oct-05 4290
15-Oct-05 4293
16-Oct-05 4301
17-Oct-05 4301
18-Oct-05 4311
19-Oct-05 4330
20-Oct-05 4325
21-Oct-05 4376
22-Oct-05 4404
23-Oct-05 4411
24-Oct-05 4420
25-Oct-05 4414
26-Oct-05 4399
27-Oct-05 4400
28-Oct-05 4434
29-Oct-05 4447
30-Oct-05 4446
31-Oct-05 4439
1-Nov-05 4427
2-Nov-05 4500
3-Nov-05 4506
4-Nov-05 4525
6-Nov-05 4593
7-Nov-05 4599
8-Nov-05 4613
9-Nov-05 4659
11-Nov-05 4674
12-Nov-05 4741
13-Nov-05 4749
14-Nov-05 4748
15-Nov-05 4761
16-Nov-05 4753
17-Nov-05 4796
19-Nov-05 4865
20-Nov-05 4853
22-Nov-05 4876
23-Nov-05 4878
24-Nov-05 4854
25-Nov-05 4858
26-Nov-05 4864
27-Nov-05 4863
28-Nov-05 4846
29-Nov-05 4841
30-Nov-05 4845
1-Dec-05 4836
2-Dec-05 4790
3-Dec-05 4795
4-Dec-05 4791
5-Dec-05 4782
6-Dec-05 4795
7-Dec-05 4785
9-Dec-05 4818
10-Dec-05 4827
12-Dec-05 4829
13-Dec-05 4833
15-Dec-05 4805
16-Dec-05 4776
22-Dec-05 4679
23-Dec-05 4669
31-Dec-05 4620
1-Jan-06 4502
2-Jan-06 4536
3-Jan-06 4590
4-Jan-06 4614
5-Jan-06 4666
6-Jan-06 4691
7-Jan-06 4770
8-Jan-06 4803
9-Jan-06 4804
10-Jan-06 4810
11-Jan-06 4924
12-Jan-06 4946
13-Jan-06 5009
14-Jan-06 5005
15-Jan-06 5022
16-Jan-06 5010
17-Jan-06 5074
18-Jan-06 5098
19-Jan-06 5147
20-Jan-06 5216
21-Jan-06 5248
22-Jan-06 5250
23-Jan-06 5287
24-Jan-06 5308
25-Jan-06 5328
26-Jan-06 5382
27-Jan-06 5449
28-Jan-06 5463
29-Jan-06 5460
30-Jan-06 5467
1-Feb-06 5499
2-Feb-06 5534
3-Feb-06 5579
5-Feb-06 5611
6-Feb-06 5686
8-Feb-06 5735
9-Feb-06 5783
10-Feb-06 5809
11-Feb-06 5881
13-Feb-06 5920
14-Feb-06 5983
16-Feb-06 6073
17-Feb-06 6078
18-Feb-06 6096
21-Feb-06 6134
23-Feb-06 6177
24-Feb-06 6227
25-Feb-06 6280
26-Feb-06 6283
27-Feb-06 6283
1-Mar-06 6217
2-Mar-06 6266
3-Mar-06 6312
4-Mar-06 6325
6-Mar-06 6316
7-Mar-06 6321
8-Mar-06 6383
9-Mar-06 6397
10-Mar-06 6470
11-Mar-06 6542
12-Mar-06 6538
13-Mar-06 6537
15-Mar-06 6602
16-Mar-06 6586
17-Mar-06 6632
18-Mar-06 6631
19-Mar-06 6631
21-Mar-06 6631
22-Mar-06 6651
23-Mar-06 6645
24-Mar-06 6700
25-Mar-06 6700
27-Mar-06 6652
28-Mar-06 6651
30-Mar-06 6634
5-Apr-06 6694
7-Apr-06 6733
8-Apr-06 6784
10-Apr-06 6821
12-Apr-06 6841
13-Apr-06 6855
14-Apr-06 6854
16-Apr-06 6898
17-Apr-06 6942
18-Apr-06 6930
20-Apr-06 6957
22-Apr-06 7020
26-Apr-06 7010
27-Apr-06 7011
28-Apr-06 7065
1-May-06 7017
3-May-06 7053
4-May-06 7082
5-May-06 7140
7-May-06 7159
9-May-06 7194
11-May-06 7259
12-May-06 7277
13-May-06 7310
18-May-06 7251
19-May-06 7308
20-May-06 7343
21-May-06 7338
22-May-06 7338
24-May-06 7355
26-May-06 7410
27-May-06 7411
31-May-06 7387
1-Jun-06 7367
2-Jun-06 7355
3-Jun-06 7379
4-Jun-06 7402
5-Jun-06 7422
9-Jun-06 7488
14-Jun-06 7570
19-Jun-06 7595
22-Jun-06 7618
24-Jun-06 7646
25-Jun-06 7652
26-Jun-06 7641
27-Jun-06 7642
29-Jun-06 7630
1-Jul-06 7647
6-Jul-06 7695
8-Jul-06 7700
10-Jul-06 7686
11-Jul-06 7674
14-Jul-06 7740
17-Jul-06 7756
21-Jul-06 7894
23-Jul-06 7933
26-Jul-06 7933
28-Jul-06 7928
29-Jul-06 7953
30-Jul-06 7955
1-Aug-06 7845
2-Aug-06 7822
5-Aug-06 7827
6-Aug-06 7853
9-Aug-06 7949
11-Aug-06 7946
12-Aug-06 7994
14-Aug-06 8024
16-Aug-06 8020
18-Aug-06 8080
21-Aug-06 8114
That’s about one listing for every 24 households using Y2K household numbers.
Expanding cities that have seen rampant speculation - like Phoenix and Tucson - have the prospect of a double whammy because their local economies are highly dependent on construction, to house new migrants. The empty speculator-owned homes coming on the market cause inventories to grow. As construction activity reduces, the local economies in such cities could suffer a lot more than those of other cities, with a consequent secondary depressive effect on the housing market.
This effect undermines the contrary argument sometimes put forward by realtors and others: that because these cities are expanding, prices won’t fall much.
This effect undermines the contrary argument sometimes put forward by realtors and others: that because these cities are expanding, prices won’t fall much.
Well said.
Phoenix & Tucson? The poster child for this is Las Vegas.
Because cities are contracting, prices will fall.
Here’s Gilbert more on a weekly basis using the mls as the source (No, I’m not a realtor):
20-Jun-05 488
16-Jul-05 520
18-Jul-05 530
25-Jul-05 548
31-Jul-05 558
6-Aug-05 579
13-Aug-05 598
20-Aug-05 612
27-Aug-05 663
3-Sep-05 699
10-Sep-05 742
18-Sep-05 799
24-Sep-05 856
1-Oct-05 891
8-Oct-05 945
15-Oct-05 1034
22-Oct-05 1070
29-Oct-05 1116
5-Nov-05 1175
12-Nov 1220
19-Nov-05 1282
26-Nov-05 1270
3-Dec-05 1297
10-Dec-05 1297
17-Dec-05 1270
24-Dec-05 1223
1-Jan-06 1214
7-Jan-06 1274
14-Jan-06 1393
21-Jan-06 1478
28-Jan-06 1507
4-Feb-06 1590
11-Feb-06 1675
18-Feb-06 1733
25-Feb-06 1787
4-Mar-06 1824
25-Mar-06 2025
1-Apr-06 2070
8-Apr-06 2156
16-Apr-06 2209
22-Apr-06 2300
29-Apr-06 2321
6-May-06 2356
13-May-06 2401
20-May-05 2444
10-Jun-06 2604
17-Jun-06 2624
24-Jun-06 2659
1-Jul-06 2699
7/8/2006 2732
7/22/2006 2770
7/29/2006 2759
8/6/2006 2739
8/12/2006 2777
8/19/2006 2818
(Another as yet unmetioned aspect of the madness of the bubble. The stuff that’s been built over the last 5 years is nothing I’d ever want to live in personally.)
I was give a copy of the number of homes built in each year back to 1900 in a housing market class in the mid-1980s, and advised not to buy anything during a big year for competions. In the bad years, only the best workers and materials are used. In the good years, corners are cut and alcoholics become carpenters.
This is true!!!! My buddy in new home sales new a guy who was a contruction QC and superintendent… he was an alcoholic… they fired him because some one smelled wisky…they grabbed his Dunkin Donuts coffee cup at 6am, and it was cold…with Jack Daniels in it instead.
Play it safe… no one, should buy a house in Phx metro until atleast 2008 or 2009. I notice the traffic at restaurants and retail is down, all over Scottsdale, and there are about 1/2 the number of idiots with 22chrome wheels rolling around as there were last year. I remember in Spring 2005, the town was clustered with BMW M3’s from California, with the OC dealer frame on the lic plate… i guess these were the scumbags paying 400k in March 2005 for a stuccobox that was 200k in Dec 2003, and then putting it back on the market for 550k in fall 2005. This was 85254 and 85258, where most of this went down.
Guys from SanJose were buying up 10-20 new build in the Gilbert/Chandler area. I met two guys a model home…struck up a chat…(they rolled in a CL55 AMG Benz btw…Cartier watches) and said they were moving down to Gilbert… I said, yeah right! you b.s. artist… do you think your’re talking to a DD sales bimbo.. wtf is the deal? So, I said I was flipping(lie) and wanted to compare notes. They fessed up to having bought 12 homes so far and had a goal of 20. They put 20% down, did stated/no doc loans, and shotgunned them. They said, that with 60k/home down, and if they can make 60-100k per home on the flip, they would like to turn 1.2mil into 2.4-3m.
This is just one example of the stuff that went down. And that don’t count the Condo Conversion crowd !!!
Hey PTP,
I loved this tale. What greedy swine. I can smell them from here! I am assuming anyone anyone who bought 10-20 homes in AZ last year is feeling increased testicular pressure each day these new inventory numbers come out. Serves them right, the vermin.
It would be nice to follow up on these San Jose guys.
How did they get the loans? Were these loans for owner-occupied
or investors? Will the local DA office prosecute ?
“…Using NAAR statistics, the average price of all homes sold this year in Flagstaff is between 97 percent and 98 percent of the average list price.”
This “percent of the average list price” is often just another twisted statistic.
Keep dropping your list price and you may actually come close to it when the house is sold.
As a matter of fact, throw in enough incentives, and you may even exceed the list price.
What’s so great about the “list price” anyway…
http://tinyurl.com/fohwr
Haha this guy says Phoenix is one of the top 10 places to buy RE because it was ignored in the boom.
Thanks for the link cactus.
This kind of behavior and advice is just plain criminal.
I emailed their “editor in cheif”:
“Phoenix, Arizona. Ignored in the boom, now being discovered by investors. Most cities here are bargain-priced.”
His title better be Editor of the Folsom Daily in a few years. Unless his borrowers find him first…
The web page below, which I often visited to watch the pricing on a cabin that I thought would fit perfectly on a scenic lot in Rim country, is now for sale. I really liked the products and the pricing, and hope that the builders are still in business and are just retrenching to wait out the cycle.
Search Results:
True Value Homes and Cabins. We build quality homes and cabins on your lot anywhere in Arizona. Building homes in AZ for over 30 years!
http://www.tvh.org/index.html
Our curiosity won out and my wife and i took a drive through some of the developments in Sahuarita which is about 20 miles south of Tucson. We drove through one of the “older” neighborhoods, circa 2003. Here I did not think there an inordinate number of For Sale signs when when considers there are some military and Homeland Security (Border Patrol, Customs, etc) who transfer. However when we looked at two new neighborhoods (both KB homes), it was a very different story. In the first one, I was astounded with the number of For Sale and some For Rent signs. It seemed house after house. Most of which looked occupied. Then over to phase#2 ,that has about half completed and half still being worked on. Again, with these obiously very recently completed homes, For Sale after For Sale. Finally we checked a section of KB homes with price tags starting at $600K+. It seemed ludricous to see what would be described for this area as McMansions plopped down on a lot which is basically the imprint of the house with what appeared to be 10′-12′ between homes. They give the appearance of being stuffed onto atoo small area. They were for the most part in various stages of construction wiht a sprinkling of somewhat smaller houses completed and incomplete.
As someone wrote in an earlier reply to one of my posts that Tucson cannot support the number of $350,000 with wages here. Considering tha Sahuarita is working folks, it is a mystery, at least to me, as to who the target audience may be for these houses. Sahuarita is not the Catalina foothills.
In Sahuarita, when you sell you have to give 1% to the HOA. Ouch.
Another comment on the Tucson housing market: In March 2002, I attended a presentation by University of Arizona economist Marshall Vest. He drew a graph showing a rapidly ascending line depicting rising housing prices. Below that line, he drew another, slowly ascending line representing local job growth. Between the two lines, he drew a circle and said, “Here’s the bubble.”
Now, almost 4.5 years later, the bubble is here indeed.
How do you folks pull up these data on the number of listings in particular Arizona markets? Is this data available to the public? I’d dearly love to see it for my home area of Waco Texas. Given the amount of construction around here I suspect the story is somewhat similar but on a smaller scale.
For Flagstaff, AZ I just visit the MLS website (www.northernarizonamls.com) every couple of days and enter the numbers into an excel spreadsheet. Over time you can see trends developing. I’m not a realtor so I don’t have access to the really interesting data (#’s of sales and prices, etc) but it’s still possible to see the inventory skyrocketing and make inferences from it. I’d imagine that you could get the same sort of info just from counting the FSBO’s in the newspaper as well. That’s how I do it, anyway…
Thanks.
I can’t find the comparable site for Waco but some googling did turn up this site on the Texas A&M server. Interesting data. Listings are going up but nowhere as bubbly as Arizona
http://recenter.tamu.edu/data/hs/hs540b.htm
At least not yet.
I live in mid-tow Tucson and a lot of 3brm SFH’s are listing for $400K+, I dont know who can afford them as the average wage here is like $10/hr. I’m renting a nice 2bdrm townhone for $885 near Reid Park, landlord offered to sell to me in ‘04 for $150K, but I declined seeing as I had just been laid off from Gateway. Zillow now shows $219K but I dont know how accurate that is, did I miss out on some equity or what?
My feeling is Tucson/Phx is gonna crash hard! No one here remembers the early 90’s when things were so bad the Foothills Mall had one store left that was open. Everywhere I go I see tons of For Sale/Rent signs and nothing here is moving!
Bought my home on the NW side of Tucson in 1993 for $91,780. Realtors now tell me it should be listed for anywhere from $264,99 to $269,900 once fixed up. It needs paint and carpet. I have it FSBO at $250,000 as is, but so far no luck.
The trouble with dropping the price is I’ve got to buy something else. Even if I rent for a while, it’s hard to go too far down not knowing for sure whether prices will really be lower in a few years. In a way, it seems safer to stay put and sell/buy after the dust settles.
Check out this website.
It shows the daily price reductions in Tucson.
Yesterday there was almost 200 price reductions
Check out this website:
http://www.tucsonhousingbubble.com/
The site shows the daily price reductions in Tucson’s housing market.
Yesterday there were almost 200 reductions in Tucson.
John