I remember reading the Arizona Republic story on this kid and deciding right about then I had to sell my place, and eventually start a blog to warn others about the housing bubble.
So it was nice to see the mea culpa piece today in the Republic on how the Arizona housing market has crashed, there's a wave of foreclosures, and at the head of the pack is the same kid they had profiled just two years ago, who is now a complete failure, and his houses are in foreclosure.
Come on folks, tell me this wasn't obvious. Even dumb realtors with blogs in Phoenix should have been smart enough to see this coming a mile away.
But of course, they weren't.
From February 2005:
Zareh Tahmassebian lives in Las Vegas but has bought 15 houses in the Phoenix area since summer. The 23-year-old mortgage banker is gambling on home values continuing to climb.
Tahmassebian and a partner paid more than $2 million for their Phoenix investment properties and estimate the houses are now worth almost $3 million. They put 10 percent or less down on each house, so only about $300,000 of their own money is on the line.
"Leverage is the name of the game," he said. "Why buy one house with cash when you can buy 10 of them at 10 percent down?"
The partners plan to sell the houses in a year or two and buy more. They aren't worried about rents covering the mortgage payments because they're counting on appreciation. Plus, Tahmassebian and his partner can write off any losses and mortgage expenses.
Flash forward to today:
Investors sparked the run-up in home sales and prices during the Valley's housing boom. Now, they are behind much of the area's rapid increase in foreclosures. At least one-quarter of all Phoenix-area homes to fall into foreclosure this year are owned by investors, according to an Arizona Republic analysis of residential foreclosure records. The number is rising monthly as investors, who relied on adjustable-rate or subprime mortgages to buy properties, fall behind on climbing payments.
Las Vegas mortgage broker and investor Zareh Tahmassebian is among the out-of-state buyers who started the speculator-buying boom in metro Phoenix. In 2004, he was just 23 when he and partners bought 15 houses throughout the Valley. Tahmassebian was so bullish on Arizona real estate that, in 2005, he moved from Vegas to live in one of his Valley homes in Chandler.Now, like so many others, he is losing properties.
Earlier this year, he lost his Chandler house at a foreclosure auction. He owed $490,000 on the property he bought for $464,117 in September 2005, according to public records. Some investors, like Tahmassebian, tapped equity in one house to buy another and now owe more than the home is worth. Others put so little down on homes they are just walking away from them.
