This leaves only one question: are most realtors stupid? or are they lying?
1. Prices are dropping at over 2% valley wide each month, and the speed of the drop is accelerating
2. For the past half dozen months, more homes have entered foreclosure than have sold.
3. for the last 2 months, foreclosures and short sales have accounted for nearly 40% of the transactions. Banks cut prices till they sell the house, so this leads to fast dropping prices.
4. credit is still tightening. Less buyers qualifying means less demand, = dropping prices
5. condos are being overbuilt all over the city. Cranes dot the skyline, these projects will all dump into a dead market, taking out the condo prices
6. rental vacancies are climbing through 10%. Rents will be under pressure for a few years as well, leaving less motivation for someone to quit renting and buy.
7. Phoenix is actually losing jobs...
I'll write more, but that is enough for now... PRICES WILL DROP FOR DARN SURE THROUGH THIS WINTER!
read my blog/ get my newsletter. Buying at the bottom makes instant money, buying too early is catching a falling knife!!!
I'd say both...they are stupid if they think people believe the lies....
Looking on Craigslist I have seen 2 properties...both started with "Purchased in 2006 for 1.2 million bank is selling for 699k..." How much of a drop in price is that...let's see what is that... roughly 40 to 41 percent one in Scottsdale the other in Paradise Valley...the crown jewels of Phoenix...if they are off at 40 to 41% what does that say about the rest of the Valley...
Which coincides with the L.A. market which according to the Case-Schiller Index has decreased 35% in price since last year from April to April...Dataquick has suggested it has slipped another 10% since then...
Doesn't look like all Real Estae is local this time...I also expect Phoenix to fare worse than L.A. I had predicted L.A. would drop 50 to 60% looks like the market is going to overshoot that since we are already at 40% and the forclosures have not been cleaned up as of yet....
I totally agreed with Jay, who knows
Phoenix is expected to grow. Buyers are out of state
We have the weather and sunshine almost all year round.
It is a good time to buy, Buyers Market.
I would have to agree with Jay, I wish I had a crystal ball to say exactly. What we can all tell you is that prices have come down anywhere from $60k to $150k +. If you buy now or wait a few months, it will still be a great deal. The good thing about Phoenix is there are still tons of people moving here. We are now 5th largest city in the US. We pushed Philadelphia into 6th place. The values will come back around to where they were 2-3 years ago in due time. Before the big boom Phoenix was averaging 6-7% equity a year, that is great! You don't find many opportunities to earn that much on your money. 43% in one year is unheard of and when you think about it not very practical hence the market we are dealing with today.
Even though housing has slowed down, retail and commerical development are still moving forward. There is tons of develpment still going on in the Phoenix Metro area. Check out my website for more information.
Hope this helps! Have a great evening.
Why is it that when prices went up nationwide realtors never said "it's local", but now that they're going down, suddenly price declines are usually within a certain two square mile area here and there? It doesn't make any sense, and don't listen to realtors...they're best interest is for you to pay the most money possible, because they get a higher commission.
Wait for interest rates to rise and thus principle on homes will fall. Refinance for a lower rate in 10 years.
Don't be fooled into thinking that this is anywhere near the bottom. We have years to go. Go look up historical data on real estate bubbles for the last 100+ years, and then determine whether or not we are even close to the bottom.
Here is the truth:
1) No one can accurate predict future prices
2) Real Estae is local - very local.
Let's look at "Real Estate Is Local". What is happening in one neighborhood or subdivision is completely different from another.
Example: My friend has a home in a highly desired area of the valley. His home Zillows for $970,000 (This is usually off up to 15%). Someone purchased a similar home in his neighborhood for $730,000 and invested just over $200,000 in upgrades. The home sold in less than 60 days for $1,495,000. The home across the street from him is pending at $1,395,000. There is a new home to the market at $1,795,000. There is a "bank owned" home for $430,000 that is not moving. We have been watching his neighborhood for the right time to sell and we are seeing prices INCREASE drastically because of HIGH DEMAND and central location. He plans on investing $200,000 to $250,000 in upgrading his home and if we sold it "today" it would probably return around $1,695,000. The point of this "real" story is that real estate is local and it is "how you look at the numbers" that matters.
Roberto is right based on the information he researched.
John is right based on his research
I am right base don my keen observation of ONE neighborhood.
Bob, I have 3 different methods that I use with buyers to determine if they are OVERPAYING for a home and one of them completly ignores the market. If you are seriously considering getting a "good deal" you can visit my website and email me: http://www.TheKeysTeam.com
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I would be surprised to see an additional 30% drop in values in Scottsdale. However, even if it did happen, I would hold my home for the long term. Over time, it will become a rental property and will generate positive income.
With reports of multiple offers on homes across the valley, I don't think it's likely.
I noticed a little blurb on our local NBC affiliate here in Phoenix which mentioned some good news. (Funny how the news broadcasts always put the good news at the very tail end of their shows with no time to elaborate). Anyway, the story mentioned that home and condo prices in Scottsdale actually INCREASED in the month of February. One month does not make a trend, however, with the activity my business partner and I have seen regarding Scottsdale, I would hasten to guess that an additional 30% decline is not in the works. When you look at some of the prices on homes and condos on the market right now, they are already at a steep discount, some priced at 2001/02 levels.
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