Even though all of this was predicted, and is part of the Econ 101 meltdown underway, it's still a bit shocking when you see it in print for the first time. We spoke months ago about the far-flung suburbs of Phoenix being a future ghost town disaster area of empty stucco homes as far as the eye could see, that nobody would want at any price, and, well, that's what we've got.
Here's (yet another) report from housingpanicgroundzero, Phoenix, Arizona, complete with panicked realtors getting together to commiserate and figure out what the heck to tell homeowners that they had just a few months ago told "real estate never goes down"
Slowdown in house sales compels 'brutal honesty'
Real estate agents need to be "brutally honest" with sellers today, as there is about a six-month supply of unsold homes, agents were told at a panel discussion Thursday night.
Many clients are still holding out for last year's prices and not trusting their agents, but agents were advised to teach sellers how competitive the market is and not just tell them what they want to hear.
"You are not going to sell a property at market value. You are not going to sell it for its appraised value," said Paul Pastore of Re/Max Achievers in Chandler. "You are only going to sell it for what someone is willing to pay."
There is an 18-month to two-year supply of unsold homes in Surprise and 2 1/2- to three-year supply in the Johnson Ranch area near Queen Creek, said Russell Shaw of John Hall & Associates in north Phoenix. Homes are taking an average of 77 days to sell in the Phoenix area, he said.
It is common for prices to be reduced several times if a house isn't selling. Pastore said he even quit putting prices on fliers because they are so flexible. Agents talked of houses selling for $50,000, $80,000 or other amounts below appraised values. One agent said she has a home priced $100,000 below appraisal that isn't selling.
Bruce Fraser of Century 21 Metro Alliance in Chandler remembers an Ahwatukee Foothills man who insisted that he be able to set the price and commission and wanted a price in the $500,000s. Fraser recommended a lower price. "The man shook my hand and said, 'OK, it's time for you to leave.'
August 27, 2006
Man, the wicked, shocking, brutal honesty keeps coming: A three-year supply of homes in Queen Creek, Arizona
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28 comments:
Gee, who could've predicted this turn of events? Bwahaha!! May they slow roast in the Arizona sun for decades.
I'm not advocating it, but there could be incidents against realtors and builders soon. Seriously. There's some crazy people out there. At least a rock through a window here and there, and maybe even torching model homes in developments where the builder is cutting their prices (and screwing recent buyers)
Watch for it.
housingpanic has a zero tolerance policy when it comes to violence against the REIC. Same with politicians - no matter how corrupt and stupid they are nobody deserves to live in fear of violence. The REIC and politicians of course are fair game for brutal attacks using the best weapon ever invented: Words.
I think Anon raises a serious point though, one that concerns me.
oh, by the way, I invented the term REIC(TM) - Real Estate Industrial Complex. I think that's finding its way into the lexicon, eh?
Nothing would make me prouder!
I was inspired by the "Military Industrial Complex" term used in JFK conspiracy writings, which wanted to keep the Vietnam war going so as to feed the beast.
The REIC wanted the bubble to keep going so they could all get rich. Now they're screwed (although many got rich)
I use REIC, I didn't know it was yours though. Kudos. I thought it was Ike who coined the phrase military-industrial complex. Advocating violence is never a good idea. Stupid sheeple who can't think for themselves need an education from the school of hard knocks. (SOHK)
yup, Real Estate Industrial Complex looks to be first used in HP on November 5, 2005 with this post:
http://tinyurl.com/kr2fb
I think for fun I'll use REIC(TM) from now on - a play on REALTOR(TM)
oh, wanna do something funny? Type in www.realtwhore.com and see where it takes you
:^)
Keith you freakin whore!! Just kidding.
I am not surprised! I live in San Diego, family (parents,sister) live in Phoenix. For the last nine years, everytime I go there, I go through Cave Creek, Chandler area.
Several years ago...nothing or not much, maybe in Chandler.
NOW, the new developments that have sprung up seemingly over night are amazing! Packed in, boxy, cookie cutter type (surprise)! Still aways from any business or should I say potential employers, shopping and still a drive to downtown PHX!
If you've seen it, then you would wonder, why there? Just because it's open desert you build on it?
Now what are they gonna do with it?
Keith jumped off a building after you posted that foobeca.
Are they are offering incentive's like avacado green appliances, 3" shag, and tile countertops?
If so, I'm in!
Keith is a Freakin whore!
.....but I still love him!
Mom
"The man shook my hand and said, 'OK, it's time for you to leave.'
That is what everyone should say to RE Agents from now on.
Farm Girl
I remember when the dot.com's all imploded, some guy walked into his broker's office near here and shot his broker to death, wounded the secratary, then turned the gun on himself. I would not be suprised to see a repeat of this in the real estate world. American's are far too stupid and spoiled to take responsibility for their own actions anymore, and will surely lash out at the first perceived cause of their anguish (outside themselves of course).
nooooooooooooooooooooooooooooooooooooooooooooooooooooooooo!!!!!!!!
man, just like bottled water, I think I have a good idea and someone beats me to it
OK, well, I popularized the term, eh?
Pastore said he even quit putting prices on fliers because they are so flexible.
When I pick up one of these with no price on it it goes directly into the trash can. No asking price, no call or visit.
Keith your back!!!
Dead cat bounce off the building eh?
Bring out your dead!
REIC, guys where's the "industrial" in this?
This is a post-industrial society of the 00s, not the good olde 50s and 60s where defense work actually had some peacetime dividends like Apollo, chip design, communications, material sciences, etc.
This is the Real Estate Ponzi Perpetuation Complex, a post-industrial smorgasboard of bullshit artists with no inadvertent redeeming features. I doubt even future generations (meaning 22nd century) of dwellings will be affected by any of the housing innovations (Cough!, Cough!) of today.
This is a bust in every sense of the world. I'll take SDI/Star Wars spending over it, anytime of the day.
ok, back to the article. this is sad and funny all at the same time. more sad is that now that this affects their earnings, they're getting serious about it. it is just plain carnage here in phoenix. open houses with no buyers. sellers dropping their prices, and still no buyers. a new unit here on palm lane has dropped from 649K to 449K and has sat on the market for 152 days. the penthouse at regency started at 949K and is now down to 699K, and on the market 101 days. there is no bottom until there are buyers, and i see none. and on the news here, they showcased a "massive open house" with like 30 realtors at the same time in the same area. they had ONE COUPLE SHOW UP ! insanity.
I didn't invent the term REIC, but as inventor of the Internet I stake my claim to this netling.
What goes around comes around. Those fraudulent appraisal are now reversing to the rightful home prices.
OK everybody here is a big part of why - In the fascinating world of deficits, December exports of $111.5 billion, versus imports of $177.2 billion, results in a goods and services deficit of $65.7 billion, taking us to a new record.
And it is not only trade deficits that are getting bigger, as Paul Kasriel, Director of Economic Research at Northern Trust, writes " In dollar terms, households ran a record deficit of $470.6 billion in 2005. Relative to their after tax income, households ran a record deficit of 5.2% in 2005. Households in 2005 ran a bigger deficit than did the federal government!"
At the Biz.Yahoo.com news site we read that "Critics say the rising trade deficit is a major factor in the loss of nearly 3 million manufacturing jobs since mid-2000 as U.S. companies moved production overseas to lower-waged nations. Many economists believe those manufacturing jobs will never come back."
Well, one of those people saying such terrible things is Richard Trumka, secretary-treasurer of labor's AFL-CIO, who says that "Such a huge trade gap undercuts domestic manufacturing and destroys good U.S. jobs. America's gargantuan trade deficit is a weight around American workers' necks that is pulling them into a cycle of debt, bankruptcy. Crack dealers will prosper.
I Love Phoenix. I bought in 1996, paid cash for a 5/4 on an 2 acre lot in "PaVa" (My slang term of endearment for Paradise Valley, the City that believes traffic ticket abuse and drver extortion is a core value.
The only thing that I will miss with the ongoing crash is the fun I had during the last two years with the REALtwhores trying to navigate their way past my mastiffs to knock on my door to let me know they had buyers for the house. My dogs now have to find other ways to entertain themselves.
nice ghetto dogs. A typical HP reader. Gold front teeth too?
I am TWMD ("Typical White MD"). Ghetto diversity is lacking in the town of Paradise Valley, but I get plenty on the job as a surgeon. Perhaps I got the mastiffs because I am over compensating for my extreme whiteness. Maybe I have the dogs because they protect the house better than the alarm/security service. I have pulled my share of .38 slugs from real black guys with wonderfly gold teeth who live the hip hop lifestyle. I think they would hang with me post op, and rehab, so long as they make the trip, since I am the Doc that will return the spent slug back to the family as a reminder of the episode. I have no doubt that there must be a former patient or two with said slug embedded in tasteful, hand crafted medalions, worn like medals of valor in the hood.
Perhaps too much detail for the finite bandwith of this blog. See you in surgery, but make sure you have insurance, as my business manager will not accept deeds of trust on your shrinking equity.Unless I am working the swing shift the County Country Club (County Trauma Center, where due to Doc shortage of way too white surgeons, I spend a shift each week), you will need to have real cash before you can get past the front desk and schedule your date with my knife.
You must be a TWMD for dogs and cats. Even if you are, I won't have my dog open up by you. You sure don't sound like a typical professional doc.
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