What happens when nobody wants to buy a home, while at the same time tens of thousands just want out? Holy crap, it's getting uglier and uglier in Phoenix by the day.
Memo to anyone trying to sell a home in Phoenix - drop your price and drop it bigtime, now. Nobody wants your home. Your home isn't worth what it was a year ago. That was a bubble, a mirage, an investor-and-fraud-fueled mania and ponzi scheme, that suckered you into thinking your home was your ticket to riches and worth substantially more than it was just a few months prior.
It wasn't.
It's just a home. Just some land, wood and concrete. I sure hope you didn't do a HELOC and spend all that fake equity on yourself. And I sure hope you're not counting on your home to fund your retirement.
Auction capitalizes on housing surplus
Valley home sellers frustrated by a lack of action on their listings will soon have another selling tool: the auction block.
More than 100 homes are expected to go up for bid in a mass housing sale set for next month in downtown Phoenix.
Housing auctions, popular during the economic downturn in the early 1990s, are re-emerging as sellers look for different ways to make their home stand out from competing listings.
The Valley's housing market is struggling to pull out of the doldrums after the frenzy of 2004 and '05 when speculators and easy mortgage money created record sales and prices. In addition to the 40,000 resale homes on the market, it is estimated that there are as many as 25,000 "spec," or speculative, houses that home builders have completed or are working on but have not sold.
February 03, 2007
Phoenix housing Swann-dive update: 65,000 unsold homes + record low sales = now comes the mass auction and price collapse
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44 comments:
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no denying it now
WILL OFFER $83,000 CASH FOR $197,000 PHOENIX HOUSE...
ANY TAKERS???
But Greg Swann had a great year last year.
Exactly, Phoenix exposed,as an overpriced, overrated shithole populated by real estate pimps and semi-literate fortune seekers.
The following comment was posted on the reader comment section of the Arizona Republic's public web site, after publishing the article Keith has referenced. In a few sentences the writer has succintly explained the reason of the Phoenix housing run-up to mass speculative bubble and its now collapse.(Bottom line, American stupids and desperados, no skills, low wages,fake economy).
As others have posted here on the ugly conditions that is Phoenix and denied here also by real estate shills and Phoenix losers, here's the raw truth from a native:
>>>>>>>>>>>>>>>>>>>>>>>>>>>>
Posted by: Julie9673 (IP Logged)
Date: February 2, 2007 02:24PM
Did I see someone claiming all the call centers and truck distribution centers are high wage employment? most of the call centers in AZ are nothing more then telemarketers! And the distribution centers employ a lot of low income warehousemen, I have looked into those jobs before and they are not worth it.
I have lived here for 30 years( my whole life) and can tell you all, this place is not worth paying $300,000 for a cookie cutter house! People move to PHX because it is still the last hope for many. I have met so many people who say they moved here because of the jobs and cheap houses, nothing to do with sunshine, great winters, beautiful state. Nope, people move to Phx for one of 3 reasons-
a) They are from a depressed area with no jobs and someone told them Phx was full of them
b) They are from an area where they can not afford a house, and someone told them Phx was full of cheap homes
c) They wanted to make a quick buck off of the backs of hard working under-paid Arizonans.
And the comment on Manhattan's prices... there are people flocking here from NY because of our cheap houses, too! The best way to see where Phx is in the grand scheme of things is to look online for a cost-of-living calculator and type in some numbers. For me to live in Manhattan I would have to make 3 times my current income to maintain my current livestyle. Enough to make me stay.
But, the rest of you can go.
United we stand, divided we fall.
If the division is between the stupid and the smart, then the homeowners of Phoenix are stupid. Bring on the division, and to all you people living in Phoenix, a massively big FU!
Picture looks good accept someone needs to Photoshop Greg Swann's head onto the diver. Nevermind if it will look as if his neck is cranked... it will just be a match for the absurdity of it all, similar to the guy whoop'n it up while riding the A-bomb to it's target. Or maybe The Exorcist when the girl's head turned around...
Lemme guess: rental prices in Phoenix are plunging!!!
What I find most funny is the anti-Phoenix comments from people who actually live there. Obviously it's not as bad as you make it out to be otherwise you would have left already.
And don't give me any crap about being stuck there. Nobody is stuck anywhere unless they want to be stuck. This goes for a job, a marriage, a city, anything.
Even though I disagree with most of what he says, I'll give Keith credit for being consistent. He hated Phoenix and left. You dipshits hate it there and yet for some inexplicable reason stay year after year and complain about it.
Lead article from todays Arizona Republic follows up on spreading crash.
Pinal country is adjoining to Phoenix metro and if desperate and stupid, commutable to Phoenix. This article understates the drop, as I know Pinal county well and the homes for sale there. Price drops of 75k and even more are common from a year ago and if you're stupid enough to live in Arizona, can pick up a loser-type new shitbox for 115 to 130K.
"Pinal County home resales are declining"
David van den Berg
The Arizona Republic
Feb. 3, 2007 12:00 AM
Pinal County's resale housing market is steadily declining.
The number of sales dropped to 720 in the final quarter of 2006 from a record high of 1,785 in the second quarter of 2005, according to Realty Studies at Arizona State University's Polytechnic Campus.
The median price of an existing house in Pinal County also has steadily dropped, according to the figures released Friday.
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In the fourth quarter of 2006, the median sales price for an existing house was $191,500, down from $220,000 in the fourth quarter of 2005.
Although the county has a limited job base and commercial real estate sector, people were willing to drive longer distances to find affordable housing, Realty Studies officials said.
While affordability has improved, higher gas prices and more congested highways have begun to limit the county's housing market, the firm said.
"Because investors were also drawn to the inexpensive housing in Pinal County, higher prices have limited their role in the local housing market," said Jay Butler, Realty Studies director.
"In order to reduce inventories, new-home builders have been aggressively pursuing buyers through incentives such as specially priced upgrades, free pools and gift cards."
Re: Rental Prices plunging
WRONG. The exact opposite is happening. Now that people have stopped buying they are renting. More demand for rentals = higher prices.
SAN FRANCISCO A California research firm that tracks the cost of renting an apartment says a slump in home sales is continuing to drive up rental costs.
The increase was slightly higher in both the Phoenix and Tucson metro areas. RealFacts says the average rent for an apartment in Phoenix last year was 799 dollars a month _ a five and a-half percent increase from the previous year.
RealFacts says the spike in apartment rents coincides with a deepening slump in home sales, with landlords able to get higher rents as more people choose to rent.
Anon said:
Lemme guess: rental prices in Phoenix are plunging!!!
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No shit, Dick Tracy..how did you figure it out?
Fact;
Location: top Pinnacle Peak area of North Scottsdale: my lease on 3,500 sq. ft. home sitting on 1.7 acres with big pool and spa, detached huge guest house and 3 car garage, costs $2,400 per month. Owner/Management office has been notified that moving out after our two-lease expires in late spring.
Recently contacted by realty office that we can renew if interested at new monthly rate of $2,200. Thanked them for the offer but advised them not moving in-state but getting the flock out of this dead end state and Scottsdale-Potemkin village dump.(not exactly in those words).
(Can walk out my front door 15 minutes in either 4 directions and come across at least a dozen homes for re-sale in the $1 mil range. People are realizing the party is over and trying to cash-in on a sinking market. I was lucky to selltwo years ago, realizing it was all too bloated for this type of city.)
Phoenix sucks and yes I'm stuck here (unless i pay back all my relocation costs), at least for another 8 months and then I'm gone. I can't find anything redeeming about this town. What the hell is there to do here, besides shop at big box stores, hike, eat and drink? I have never seen a place with so many targets, wal marts, best buys, etc... I can barely see what brings people to vacation here. I would much rather be at sitting on the beach in miami drinking a corona checking out the topless chicks in thongs, rather than lying around some stupid pool in the middle of the desert or playing golf.
WRONG. The exact opposite is happening. Now that people have stopped buying they are renting. More demand for rentals = higher prices.
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I see your evidence and raise you the surge in vacant properties nationwide. Builders are still building, new supply coming online just as the new and resale markets are entering freefall. Unable to sell, these vacant properties, unlikely to be leveled, are creating an oversupply in the rental market. Demand/supply says rental prices falling.
By the way, "RealFacts", reads like an industry trade rag-- they may just be slightly biased to their clientele, which doesn't seem to be the individual renter...
"About us
RealFacts is a research organization and database publisher specializing in the multifamily housing market.
Our research, data and analysis is widely used and respected by owners, developers, brokers, lenders and trade associations. It frequently forms the basis for articles run by the trade media and, amongst others, Associated Press, The Los Angeles Times, San Francisco Chronicle, Orange County Register and San Jose Mercury News.
- Inventory product of investment grade complexes of 100 units or more.
- Each complex surveyed and data updated every quarter.
- Current rents and occupancy rates.
- Full ownership and management information.
- Sales and loan details.
Regarding rental prices in Phoenix, they are going down. Many of the same condos I looked at six months ago, are still for rent and asking less. There are a ton of condo conversions for rent by investors that can't sell. Not to mention all the homes in the same situation. This cannot translate in to higher prices.
LOL LOL LOL
You people must be absolutely miserable. I'll bet most of you are living in dingy, crap hole, apartments, hording what little money you have managed to save and sit around throfing at the mouth looking for bad news. You must become giddy when you find something the you can interpret as fitting your view.
Get a life, breath some fresh air and try reading something up lifting for a change. The sky is not falling and everything will work out as it should.
I saw this type of doom and gloom in the late 80's. It was hard times to be sure but we're still here and in fact thriving!
Last Anon - welcome to the blog. I guess you haven't heard. Us "bitter renters" in a lot of cases sold at the peak and are renting awesome places for pennies on the dollar versus the cost of owning
Baaaaaaaaaaa!
I think this should answer any questions. Vacant homes have soared. Owners can't sell, and will be desperate to rent.
Man, this seems just like the telecom overbuilding and oversupply in 2000....
Number of vacant homes for sale surges 34%
Homeownership rate unchanged near 69%, Census Bureau says
WASHINGTON (MarketWatch) -- The number of vacant homes waiting to be sold surged 34% to 2.1 million at the end of 2006 compared with the end of 2005, by far the fastest increase ever recorded, the Census Bureau reported Monday.
A year ago, 1.57 million homes were vacant and awaiting a sale.
The vacancy rate for owned units jumped to a record 2.7% from 2.0% a year earlier. From 1965 to 2005, the homeowner vacancy rate had never been above 2%. The long-term average is 1.4%.
"We have more than a million housing units of excess supply," said James O'Sullivan, an economist for UBS. "If you are looking for evidence that the worst is over for housing, you're not going to find it in this report. This argues that housing starts need to go down more."
http://tinyurl.com/37wcec
that was a sad day for greg swann when he thought he could kick the ass of the entire blogosphere
Is it "us bitter renters" or "we bitter renters"?
I always trip up on that one
Ask not what we bitter renters can do for our country's banks, ask what our country's banks can do for us bitter renters!
anon said:
"You people must be absolutely miserable. I'll bet most of you are living in dingy, crap hole, apartments, hording what little money you have managed to save and sit around throfing at the mouth looking for bad news. You must become giddy when you find something he you can interpret as fitting your view.
Get a life, breath some fresh air and try reading something up lifting for a change. The sky is not falling and everything will work out as it should.
I saw this type of doom and gloom in the late 80's. It was hard times to be sure but we're still here and in fact thriving!"
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Miserable? Living in a dingy ,crappy apt.? Scroll up and see my post about my rental in the supposedly very desirable, upscale North Snottsdale part of Phoenix
Vast options of cheap rentals, panicky speculators and realty pimps begging me to rent, with all types of concessions in Phoenix metro, and if I wanted to buy,(all-cash in my case), I can squeeze their nuts blue in negotiations.
But they can't pay me to stay in this barren souless wasteland.
Mission accomplished and outta here!
The beach, drinking Coronas and lusting at thong candy, ( s per ihatephoenix, above), sounds like a great idea, compared to these plastic, boring mega spa/golf resorts, catering to pinched old farts from the Heartland and over-extended shallow boomers.
Phoenix/Scottsdale: for people who aspire to the real upscale SoCal lifestyle but can't afford it and settle here.
Greg Swann's going back to his guidance counselor job.
Dude, I remember when you were cheering Phoenix on for having 40,000 on the market.....now they're at 65,000! That rocks!
Keith,
I am wondering if homes listed for sale include foreclosures.
I don't think it does because banks track there own foreclosures.
I think that figure of homes for sale is way to low.
"Pinnacle Peak area of North Scottsdale: my lease on 3,500 sq. ft. home sitting on 1.7 acres with big pool and spa, detached huge guest house and 3 car garage, costs $2,400 per month. Owner/Management office has been notified that moving out after our two-lease expires in late spring."
Lets see. Many workers needed to finance baby boomer retirement----hmm a home that size could be paid for 4 or 5 wage earning adults & their dependents could bring oh about 12 kids. Looks like that nieghborhood 16 or 17 peeps a home.
It depends. If used as the subject, it's "we", if as the object, it's "us".
google "phoenix rents" in the news section and you'll see article after articel about increased rents. pretty simple really, fewer people buying, more renting = higher demand for rentals = higher rents
opposite happned 2002-2005...rents fell as everyone was buying
Our company owns several apartment complexes and condominiums, so I have a very good understanding of the rental market in Florida. I admit that I don't know anything about the Phoenix rental market, but I assume its similar since both areas are feeling the brunt of the housing crash. The apartment occupancy rate in North Florida has fallen from 95% on January 1st of 2006 to 91% on January 1st of 2007. This may not sound like a big drop, but it's huge. 95% is considered a very healthy rental market. When the market gets to 90%, it's considered an unhealthy market. When the market drops below 88%, it's panic time. The market popped here in early 2006, so it took about 6-8 months to completely derail the rental market.
I forgot to mention the biggest reason why the rental market has hit the crapper here. Thousands of condo conversion units reverted back to apartments and thousands of condo projects became apartments when very few sold.
I can't speak about the single family home occupancy rates because I haven't seen the numbers yet.
This is purely anecdotal, but two different friends in Tempe were bragging about how they negotiated lower rents a month before their lease was up.
I don't know about other areas but in the Boston suburbs I'm seeing rents drop. When I last moved 2 years ago it was hard to find a 2 br apt for less than $1100 (and those were only in Lowell and other crappy places). Now I'm seeing 2 br apts in nice towns for less than $1000, they're requiring less money upfront, and they're including more utilities in the rent.
I've been considering leaving Boston because it's so expensive, but based on what I'm seeing I'm going to stick around a little longer...
Place across the street sold at a price that caused for sale signs to go up on all the other houses on that side of the street? House was solid brick with a brick garage and barn, all but the barn bulldozed? I wonder what taxes the remaining owners on the block will be required to pay now! Strange how planting a somewhat food self sufficiency can become a liability!!
will offer 140,000 cash for a 650,000 hudson valley verdancy, and 82,000 for a phoenix winter house, if low cost, low keep, is maintained in citrus land
live in phoenix commute to manhattan? dam santa monicas closer,and gas prices insane past 99 cents a gallon made from fermented methanol from sewer waters
live in a desert and know the price of water at every gallon
I had two realtors looking for rentals for me when i moved here. At the time I almost felt bad they were spending so much time showing me one place after another, because I know they don't make that much off a rental (after reading this blog, I don't feel bad anymore). One called me for two months after i had already found something. I must have looked at 30 places, people were all over me to sign a lease. Please tell me again how this translates in to higher rents??? To the jacka** who posted about us renters being gloom and doom, it's actually great being a renter and I sleep really well knowing I don't have a morgtage payment due tomorrow on some POS, stucco, particle board, crap box in the middle of the freaking desert.
BTW, the nightlife in Phoenix/Scottsdale is for SoCal/Sobe aspirational wannabees and they can't even be described as lame. The clubs/bars in Old Town and N. Scottsdale are just plain pathetic and can't even compare to those in other major cities.
When I moved to Phoenix, I had two realtors showing me rentals. I must have looked at 20+ places. I actually felt bad for taking so much of their time looking at different places; because I know they don't make much from a rental and they were working very hard to find something for me (I don't feel so bad anymore after lurking on this blog for the last few months). There is no way you can convince me that rents are going up in Phoenix/Scottsdale. Like I said before, a lot of the same units are still for rent and are listed at lower prices. I was easily able to knock off $100 my rent for a new condo conversion with everything. I have the MLS listings (left in the condo) for the place and you would have to be an idiot (my landlord) to have bought it.
To the anonymous jackass posting about renters being miserable and all gloom and doom, you are very far from the truth. I couldn't be happier knowing that I don't have a 30 year mortgage and a ridiculous payment due next week on some POS, particle board, stucco crap box in the middle of the freaking desert that will continue to go down in value month after month. I sleep very well in my rented "luxury condo conversion".
Once again, in case some of you need to be reminded:
Phoenix and it surrounding metro area is finding its own level.
Basically, a repository of mediocre poorly educated bottom-feeders seeking cheap banal living and easy money.This souless mix of carpet-bagging transients, budget seniors,tatooed misfits, real estate grifters, toothless white trash tweakers, minimum wage job seekers and pseudo Scottsdale millionaires has created a major population center that masquarades as a major metropolis but is really one big cow town. A bleak barren landscape with terrible weather,traffic congestion, bad air, stuffed with ugly stucco houses and big box retailers peddling Chinese crap, corporate food, and a dumbed down semi-literate citizenry, Phoenix metro epitomizes the lowest commom denominator of American cities. If somehow, by either plan or accident, you're living in metro Phoenix, you rank on the bottom rungs of the intelligence charts. The only reason to be here, (temporarily), is if you're making a decent income (absolute min. 250k per yr). Anything less is not worth it, as your health, mental well being and personal esteem will deeply suffer by living in this genetic cesspool of half-breeds.
You renter crack me up. You boast about how you knocked $100 off your rental. But so what? YOU LIVE IN AN APARTMENT. I don't care if they'd give it to me for free, I wouldn't want it.
"Apartment" - ghetto abode atached to negro and/or mexican familias above, below to the left and to the right
Thanks but I'll stick to living in my overpriced home with a 1/4 lot where the only negro/spic I see are workers cleaning or fixing something.
Anon, 3:30:08 PM, you show a real lack of life experience. Seriously, open your mind just a little.
I am very white and come from a remote region of the midwest where blacks and hispanics were a rarity and nobody I knew lived in an apartment. But then I grew up.
I didn't have to be a genius to realize we're all essentially the same. And I've now seen some really nice apartments, much nicer than the average house.
You should spend some time in a city, it would be good for you. Not that there aren't enlightened people in small towns - there are plenty. But some people, like yourself, just don't get it until they visit a city and gain a broader understanding of the world and life in general.
Like I said before: 'You people are miserable" Get the hell out of Arizona, I have been saying that for years. Go sit on the beach in Florida and ogle at all the girls your tiny black heart desires. My guess is you cant score here and you wont be abel to score anywhere you end up. I doubt most of could afford to live in close proximity to the beach anyway. Be gone! Your a drain on all things positive.
To those of you who claim to have sold at the height of the market well, you are to be congratulated on your keen business sense and ability to time it with such great accuracy. I tend to feel that if any of you actually did time the market correctly and did sell, it had more to do with luck than any skill.
You guys just keep on pouring over the latest stats and wringing your hands hoping for some imagined calamity to devastate this Country.
Nay-Sayers and sidelined commentators sometimes make for fun reading but in general you folks are plain ol' sick.
"Thanks but I'll stick to living in my overpriced home with a 1/4 lot where the only negro/spic I see are workers cleaning or fixing something."
You may not know this, but while you're working during the day, those "negro/spics" that you refer to are banging your wife as well...
I bought a house on the cheap back in 1997 and sold in Nov 2005. I now rent and will wait for one of the millions of foreclosures to pick from in 2007-2008
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