I realize that most of the dolts who live in Phoenix don't have the luxury of a college education, or at least a good one (see ASU standards), so this could get a bit confusing, but just in case:
There's this thing called supply. When it increases, prices likely will decline.
Then, there's that thing called demand. When it drops, that can create more of that thing called supply, which when it increases, as we know now, prices likely decline.
Talking to some folks in Phoenix, I'd say they have no idea that 1) prices are already declining, 2) inventory is rapidly increasing or 3) the market is crashing now, and I mean right now. Many homeowners I know are still counting their paper worth, or worse still, extracting $$ from their "equity" to buy new cars, a fancy trip, etc.
This market has fallen off of the cliff.
Thanks to http://overvalued.blogspot.com for another great chart. A picture is worth a thousand words (especially to the illiterate homebuyers/flippers/investors in Phoenix)
January 23, 2006
Posted by blogger at 1/23/2006