Too bad the homebuilder-advertising-supported Arizona Republic refuses to report on the devastating crash underway in its own backyard. This fresh tidbit slipped out from Fed Governor Janet Yellen today - some pretty harsh stuff... and yet spot-on...
SAN FRANCISCO (MarketWatch) -- The housing slowdown has turned some areas of Phoenix and Las Vegas into "ghost towns," where many unsold homes stand empty, Janet Yellen, president of the San Francisco Federal Reserve Bank, said Monday.
Yellen said that she heard the ominous description from a "major home builder," who told her that the share of unsold homes in some subdivisions around the two Western cities has topped 80%.
"Though the situation isn't that bad everywhere, a significant buildup of home inventory implies that permits and [housing] starts may continue to fall, and the market may not recover for several years," she warned, according to the text of a speech delivered Monday at the Hong Kong Association of Northern California in San Francisco.
October 16, 2006
Fed official: "Housing slowdown creating 'ghost towns' (in Phoenix and Vegas), market may not recover for several years"
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All you need to know - 54,551 home on the market for Phoenix and Maricopa county. . .and that is the offical Zip Realty number - doesn't count for sale by owner, and new inventory. . .MLS is only resale!!!!. . .Will Macy's start to give away a house if you buy a toaster???
54,551 at the same time Phoenix was finishing up the 50,000 unwanted homes that were already under construction
the builders are barges - they can't just stop on a dime
unfortunately for them though, people who put $3000 down to hold a lot can run away fast
and so they did
but honestly, the empty tracts of houses are on the far, far fringes of the metro area. the town of maricopa is the poster child for bad planning. thousands of houses in an area that has too few jobs, too few amenities (despite what the builders say) and too few roads leading into the city. it will be years before the infrastructure catches up the the stucco boxes. in central phoenix, there are a lot of houses for sale, and most of them are overpriced and lingering for months and months. i sold my home in the willow in 2001 for 275K. it is back on the market right now for 650K. 'nuff said.
the homes on the fringes always get killed in a housing downturn as nobody wants to live there. location, location, location does indeed ring true.
but... homes in great areas of phoenix (like arcadia) went stupid during the bubble. so they're gonna plummet from their 2005 highs as well
there is no place to hide in phoenix.
how can we find out how many thousands of people are leaving phoenix and vegas per month right now in negative net migration OUT?
with the housing boom bust went the positive immigration trends for those two cities.
and the millions of uncounted illegal mexicans? adios - they're going to have to go find work (or money) somewhere - or go home
also, anyone with time please research and report the monthly property crime rate numbers for phoenix and vegas. or thefts and break-ins
What is wrong with these people?
Price Increased: 12/30/05 -- $362,755 to $387,704
Price Increased: 01/04/06 -- $387,704 to $389,704
Price Increased: 02/08/06 -- $389,704 to $392,704
Price Increased: 03/13/06 -- $392,704 to $394,459
Price Increased: 03/20/06 -- $394,459 to $396,459
Price Increased: 04/11/06 -- $396,459 to $399,409
Price Increased: 04/19/06 -- $399,409 to $400,109
Price Reduced: 09/26/06 -- $403,871 to $403,841
Price Increased: 10/09/06 -- $403,841 to $404,841
Days on Market: 406
Builders are having fun with unsold inventory ,or flipper getting burned here !
last anon - flipper is adding his monthly carrying costs to his listing price
oh, man, that's funny!
but then again, I've heard more than one person say they "deserve" a certain price because that's what they paid or put into it
not understanding that the market sets the price, not the seller
Phoenix used to be the land of $30,000 millionaires, people who worked for $15/hour at call centers then went out at night and represented like they were cool So Cal millionaires. The housing bubble and loose lending practices hitting Phoenix was like giving crack to a coke fiend. They smoked that sh_t up like there was no tomorrow, bought themselves Beemers, Hummers, and Speedboats, and soon they will all be left with no jobs, no cash, no friends, and no future. It'll make them long for the old days of making $15/hour and driving a used Mitsubishi Eclipse in a vain attempt to look cool. Who needs outsourcing? There will be plenty of cheap labor ready to move onto the scene in our own backyard, just look toward the desert, and it won't just be illegals willing to work for peanuts now.
Are there any nice towns on the outskirts of Phoenix that are worth living in, or is it just hopeless everywhere?
I saw the same stuff in the SoCal inland empire. Builders still building but nobody could afford the houses. They are building tomorrow's slums today.
but, what cost 35,000 there, in that hellhole, that some created livability and class in, cost 350,000 elsewhere, today its 350,000 there, and getting ready to tax away those who created livability, or borrow and slave forever, to be elsewhere, of any class!, of the big shits, but, warm in winter
yeah, 250 miles, to the east, vacant, 250 miles to the west vacant, 250 miles to the south vacant and strangly only about 150 miles to the north vacant, all one day required by jury duty, to come into the capital city, with its funny prices, paid for by the bought off free media, as value
tabasco jenkins
Speedboats in the desert?
Come on people, set aside your bias toward Phoenix. I lived in Phoenix first in 1982 (Air Force transfer) and it was a sleepy town and out west by the base cotton fields. Beautiful blue skies, mountain vistas, quiet historic neighborhoods downtown (and yes, just south of McDowell homes were in the high 20s to low 30s then). Yes summer could get hot but we didn't have a heat dome them and it actually cooled down some at night and the cost of living was great. Sent back overseas and didn't return until 1992. Again, growing, more progressive, actually had freeways, prices still reasonable and lots of descent jobs. Forward 2005, still a nice place. That doesn't mean that all neighborhoods are nice. Climate a little warmer at night, especially downtown. More things to do, better and more diverse resturants and more diverse population. More air pollution too, not always those beautiful mountain vistas. Still, I've traveled a lot and the desert has a beauty to it. They are slowing ruining it by California style development and architecture that doesn't belnd well with the environment, but still, a mostly new, modern, clean city. Back east, dirty cities, very dense, old. Florida, moldy sprawl, California just decades of decay and lack of investment infrastructure and very crowded (was born in Monterey and grew up in Los Gatos/Santa Cruz).
Just be thankful everyone doesn't like the same thing. Also that Phoenix didn't have cooler summers or they would become California quick! Some people like it cold (my mother-in-law moved back to Edmonton, Alberta cause she likes it cold-lucky for me), others love, and I mean LOVE Phoenix. Living there all those years I met lots of folk who wouldn't live anywhere else, just like I had in Tampa, Miami, San Jose, Los Gatos, San Fransico, Vancouver, and all over europe and Asia for that matter.
Stick to the basics, economics, jobs, home value and stop bashing every city you wouldn't live in. Besides, for most people it doesn't matter where they prefer to live but if they have a job. I might love Paris but if I can't work or get a job there it doesn't matter if I'd rather live there than say Dallas.
And most the First Americans I worked with would rather live in Phoenix than up on the reservation because there were things to do and work.
I've met lots of Europeans who love Phoenix, Tucson, the Sonoran desert. The Sonoran desert is one of the richest ecosystems in the world with some of the highest bio-diversity of any eco-systems. The desert has a beauty if you have an eye to see.
I now live in Austin, it is a nice place, has a beauty of its own, doesn't have everything I want (could have bigger mountains) but if I had to leave Austin, Phoenix would still be one of my top three cities in the USA to live.
Fox, You running for mayor of phoenix? Geez!
Geeski said: "honestly, the empty tracts of houses are on the far, far fringes of the metro area. the town of maricopa is the poster child for bad planning. thousands of houses in an area that has too few jobs, too few amenities (despite what the builders say) and too few roads leading into the city."
Sounds just like Spanish Springs outside of Reno. Tons of homess no decent jobs and a horrible four lane highway.
infidel woman,
Yep, Lake Saguaro, Lake Bartlett, Lake Roosevelt, Lake Apache, to name a few. Speedboats galore, and big trucks to haul em from the valley through the desert to the lakes every weekend.
Foxwoodlief, Most Americans don't understand, and therefore, don't appreciate nature. So they sure as hell would never be able to appreciate the desert. I have only passed through (or over) and have never spent much time there. But, I could appreciate the lack of smothering humidity. Although, when it's 111 degrees, I'm not sure it matters much. I much prefer dense wooded, mountainous terrian though. Ever heard of the boston mountains?
Tabasco, I know what you mean. The amount of $150,000 ( and this is about average) boats on the lake where I live is insane.
And get this (Keith would really go nuts), a hell of a lot of people with these boats FINANCE THEM FOR THIRTY FREAKIN YEARS like a house. Now talk about paying a crap load of interest, on something that depreciates faster than a freakin single-wide trailer no less, good lord.
Phoenix is HUMID in late July through late September. Not like Georgia of course, but certainly not like the advertised "it's a dry heat."
The SW is facing a 400-year Mega-Drought, including Phoenix, Tuscon, the Palm Desert, and "Lost Wages". If one can still find the reports, go to the BLM and USGS. Their studies show the carrying capacity of Phoenix and Tucson combined is no more than 1-1.5M people or they will run out of water completely by the mid-'10s (not even counting the Mega-Drought). "Lost Wages" carrying capacity was surpassed in the late '90s. That place is a ghost town, Mad Max-like wasteland in the making. It couldn't happen to a nicer place, like Katrina nearly wiping Norlans off the wipe.
Within the next 20-50 years the SW basin will be depopulated en masse due to water shortages from the Mega-Drought, and the vast majority of people do not have a clue what they face. The Mexicans won't want the place either, as there won't be anywhere to sneak in in order to work.
Planet earth has rocketed past its carrying capacity at around 2 billion several decades ago.
The die off will not be a confined to the southwest.
Over-population is a bunch of bunk.
The earth is carrying what, 6 billion people right now, and it could carry many more.
We have plenty of problems right now (over-fishing, drought in Africa, etc.), but it's not because people are having the children God sends them. It's our messed-up materialist consumerist hedonistic WASTEFUL society.
Wait till the petro runs out -- no more 6 billion. Maybe .5 billion tops.
Human population growth resembles a bacteria bloom.
Hebrew lender, you have it right about too many not understanding or appreciating nature. Maybe that is why they pave it over.
As far as water in Phoenix, there is more water in Arizona than Los Angeles. LA stole most of their water from other desert areas and from Northern CA where I grew up. Which leads to all those dangerous levees, wait till a quake and then salt water intrusion into many of the fresh water eco systems and farmland. And if that isn't enough they pump billions of gallons of water out of the Cococino aquifer in North East Arizona to send coal slurry to that polluting power plant on the Navajo reservation. Source of most of the smog in the Grand Canyon. So yes, water is an issue but more of an issue is the improper use of it. Water to transport coal? Many springs on the reservation have dried up as a result.
The desert can support a lot more people with the proper use of resources. If homes were built for the desert, out of adobe, rain collection systems and cisterns, composting toilets maybe? Waterless urinals in all businesses? Limiting the number of golf courses and the greens. Planting native plants, xeroscapes, recharge aquifers, just for starters.
Running for mayor? No, but I've often been accused of working for the Chamber of Commerce for every city I've lived in, or even traveled to for that matter. Sorry, but I see the world as a very beautiful place. It is humans and their greed that is ugly. Instead of planning for tomorrow, building art to last hundreds of years they throw up chicken wire and stucco boxes after scrapping the earth bare. The same throw away mentality and planned obsolesence they used to build cars. You see where that has gotten the planet.
But for you desert haters, LA is a desert remember. The Sonoran is the most lush and biodiverse desert in the world. Have you ever seen a spectaculor spring bloom in the desert? Lush, green, fllled with pink, yellow, red, blue, orange flowers interspered with Saguaro and prickly pear and creosote and rugged mountain peaks? Have you smelt the smell of a monsoon, the rich aromas of the desert coming alive from rain? Snow capped mountains ringing the desert? Traveled into the many sky island throughout Arizona, each with its unique eco systms and animals? You can drive up Mt Lemon and pass through every climate zone in North America from desert, to scrub, to junipers, to pine, to aspen, all a short drive up from the Catalinas.
You apparently haven't done Organ pipes in the spring, or Sedona in winter. Hot in the summer? Yes, but have you been in a well designed sonoran garden, lush, green, shaded, maybe a small pool to dip into? Then sit in the shade, wet, sipping a cold drink? Mornings are beautiful and cool, late evening the warmth is soft and caresses your body, your soul? And winter? Often makes it worthwhile. If you have lived for any time in the desert and experienced it you sense the change in seasons (and yes, there are four) the change in light, type of heat and warmth, even the chill of winter, the smells change.
And there are great neighborhoods in Phoenix, Tucson, as there are in any city. Hot? Hot any where these days. People die in Paris from the heat some years.
It doesn't matter where you live, you can find something wonderful and beautiful in just about any place. Even when I bought a house in 1989 in the ghetto in Tampa (and people though I lost my mind) there was still beauty in the trees (very large oaks) the palms, the faded grandeur of turn of the city houses. You just need to be happy with yourself and see the beauty around you no matter where you live.
"Phoenix used to be the land of $30,000 millionaires"
Used to be?
Last memo I got it was still a town with no fortune 500 companies, no real economy, call centers galore and posers aplenty
20 and 30 somethings pretending to be millionaires via credit cards and HELOC housing atm withdrawals. Running up $1000 bartabs at axis/radius. Driving leased hummers. Go to 944.com for a sneak preview.
40 and 50 somethings who aren't saving for retirement, thinking their homes made them rich in the past year. And spending like crazy on possessions to keep up with the neighbor. Go to potterybarn.com for a sneak preview.
but what do they all do for a living? service industry jobs aplenty. and call centers. and of course, the REIC
a town now full of realtors, mortgage brokers, appraisers, builders, you name it. the home of "get rich quick" versus "work".
But alas, most of whom will be unemployed in the next few days or months.
Bottom line: Phoenix is a town with one industry - building, buying and selling homes for and from each other
and then the music stopped.
"but it's not because people are having the children God sends them"
oh lordy lordy we are so screwed.
Really Keefer?? - Phoenix has no fortune 500 companies??
http://money.cnn.com/magazines/fortune/fortune500/full_list/
Keith my wife was watching the HGTV channel last night, and they were doing the UK international, anyway is it true $400,000 for a flat!? I mean some of the place they looked at in the 18th district were 1970ish dumps 1 bedroom $453,000US for real?
needless to say they got it for $385,000 but they still had to dump $20,000 plus to upgrade.
To the phoenix lover, touting adobe building. Have you ever lived in an adobe building? They are hugely labor intensive. They fall apart regularly. Maybe strawbale would work. I personally thought phoenix was nicer than albuquerque, but I liked tuscon better than both places. New Mexico is going to crash so hard. There are less jobs there, than anywhere- and more crime, I would guess.
You just need to be happy with yourself and see the beauty around you no matter where you live.
So True, but give me a beach, salt water and the tropics. (:
Keith,
Yes it "used to be" $30K/year millionaires, because now they don't even hold down an actual job to pay them the 30K. Thus the "used to be" comment. The housing bubble has made the place worse than it was when it was just a bunch of low wage earners acting rich. Now it's a bunch of no wage earners acting rich.
I talked to a friend of mine whose parents moved to the Phoenix area from Cal. They hate it there! He said the traffic and smog is just like L.A. They bought a bigger, and nicer house, but are disappointed in the area.
Maybe the word is out about the place, and I heard similar stories from friends in Las Vegas. Californians move there thinking it's all that, but get turned off by the traffic and rough crowds (the hard core gamblers and casino employees).
Planet earth has rocketed past its carrying capacity at around 2 billion several decades ago.
The die off will not be a confined to the southwest.
Well I only hope that Richard is one of the first.....feebly typing...."see Hp readers, I was right...I told you I was Right............................was ri.........
I stand corrected, 4 fortune 500 companies
1 Avnet 212 11,066.8 Phoenix
2 Phelps Dodge 260 9,030.4 Phoenix
3 Allied Waste Industries 376 5,734.8 Scottsdale
4 US Airways Group
6th biggest city, 4th biggest metro area in the US, and they have 8 tenths of 1% of the fortune 500 companies
an electronics parts company, a copper mine, a garbage firm and a bankrupt airline. yup, great jobs there.
enough said
It is true, Phoenix isn't as nice a place to live as it use to be but it is still nicer than a LOT of places. People need to get out and travel more.
Six years ago many Phoenicians debated the fate of their city. They challenged the ruling class (The Real Estate Industrial Complex) and lost. They wouldn't impose growth boundries (Portland style), they wouldn't impose higher impact fees, they wouldn't encourage or require developers to put a percentage (Say 10%) of their building permits into redevelopement of older neighborhoods. They choose to issue more permits for NEW shopping centers instead of upgrading old ones. They wouldn't impose urban codes that would allow integrated shops and homes above those shops, especially along the light rail line.
People complained that we were becoming just another baby LA. They did respond to the outbreak of graffiti and at least Phoenix doesn't LOOK like LA in that area! People get disillusioned because they move to a suburban city away from friends and family and have no support system to make them feel integrated once the euphoria wears off from moving to ANY NEW CITY. Some other cities suffer the same problem. People move to Florida and miss the grandkids in Chicago (Why do you think Del Webb started a Sun City up there in the snow?).
What do they say, something like 3 people move to Phoenix and 2 leave? Not unique to Phoenix. All you need to do is see that everywhere is growing, and at about the same rate. Did you see CNN's Anderson Copper's report last night on America reaching 300,000,000 people?
And smog? I know few places that doesn't have smog...anywhere in the world and a lot of cities in the WORLD are worse than the worst in the USA.
And on CNN they said the inflation adjusted price of the median house today is something like $293,00 compared to $149,000 20 years ago.
And Keith, there are Five fortune Five hundred headquarters in Arizona (Avenet, Phelps Dodge, Allied Waste, US AIR, Petsmart). New Mexico has zero, Nevada two, Washington state nine. If you look at the PRECENSE of fortune five hundreds they are everywhere, as in most major cities, Phoenix has Boeing, lockhead, Northrop, General Dynamics, AMR, L-3 Communications, Goodrich, U-Haul, Major airlines with US Airways headquartered in Tempe, Nike, VF, Auto Nation, Coke, Pepsi, Major Bank buildings, and the list goes on. Housing isn't the only industry in Phoenix.
Keith,
I have visited PHX several times over the last 14 years. I like the climate and the scenery.
Is there anything that you like about PHX?
Just to repeat to Keith if you missed it, Keith said,
"Last memo I got it was still a town with no fortune 500 companies, no real economy, call centers galore and posers aplenty"
New Mexico has zero. Nevada has two. Washington state has nine. Phoenix has four, five if you count Petsmart which is just over the 500 number. You forget that all major cities have "Economies of scale" and that most Fortune Five Hundred companies have a major presence (how else do they get the revenue to be in the top five hundred?). For Phoenix, and the list is extensive if you look at all areas of production from apparel to chemicals, we ahve Motorolla, Intel, Boeing, Lockheed, General Dynamics, Northorop Grunman, AMR, L-3 Communications, Goodrich, Nike, VF, Auto Nation, United Auto group, Coca Cola and Pepsi, Major bank towers, the large campus of the Serviceman's life insurance off I-17 in North Phoenix, Phoenix is a major distribution center with large wear houses, lots of Medical jobs and Medical centers (St Joseph is one of the top in the nation), The University (major) Some of the largest law firms in the Country (Fenemore and Craig for example), the GM and Toyota proving grounds, major sports (baseball, Football, Hockey, Basketball, NASCAR), agriculture (cotton mostly now) shall I go on? There was an economy before the major expansion between 2000-2006 that involved housing, which is a major player as well, but to say there is nothing else? Where do you think most of those three million plus folk work? The economy is quite diversified compared to say LAS VEGAS.
Arizona may not have the 52 Fortune Five Hundred companies that are headquarted there, but as in all major communities they have a presence, but we also don't have 40 million people.
Keith,
To quote foxwoodlief,
"You forgot Petsmart!"
ha, ha, ha!
"You forgot Poland!"
So where are all the volunteers to move to Syracuse or Buffalo or northern Maine? If the heat of the desert is soooo terrible. People need to get real. More than half the planet has weather as hot or hotter (and more humid) than the Sonoran desert.
You complain about spending $500,000 for a one bedroom in California and yet, by your reasoning, you think that is the only place to live! Let us see....three hundred million Americans all competing for what, some twentyfive million residences in California, what would that bidding war cause prices to go to?
I've heard people say how much they hate the rain of Seattle or the heat of Phoenix or the snow of Buffalo or the humidity of New Orleans but hey, this is planet earth.
Be thankful somebody wants to live where you don't or you think San Paulo Brazil is crowded? You bash Phoenix as having no real jobs and not as many Fortune five as say New York city but does San Diego? La Jolla? Tacoma? Not every city is going to be New York or San Francisco. I think the Avenue of the Giants and the Redwoods are incredible but would I want to live in Fortuna? I love the Sierra but would I want to live in Chico?
There are some gorgeous places in Spain, no, in fact there are a lot of gorgeous places in Spain and Italy but you look at most of Europe and see the villages dying. You can find more abandoned houses all over Spain than you can imagine. Why? No jobs. Outside of Baracelona or Madrid or Valencia unemployment in the countryside is high. What is the difference here in the USA? Very few towns under 100,000 people can be said to be thriving and industry? Where? Why do you think all over the world peoplel migrate to mega-cities? At least the hope of work or opportunities. I can't imagine why anyonewould leave rural Brazil to live in the shanties of Rio or San Paulo but then I'm not hungry.
I just have to believe by most of the comments here that bash other places is there are a lot of bitter, closeted Callifornians or Californian wanna bes' here. When I lived in Phoenix I wished that those Californian transplants would have stayed in LA instead of ruining a nice place to live and bringing their house inflation with them. That is why I now live in Austin. They say the population of Austin won't reach one million until 2025.
heat! try times square, hookers, with no money, when you have no money, you aint seen nothin
some neotrumpet will try to build 65 sq miles of 120 story high rises between buckeye and apache junction, as the downtown, the natives have been waiting for, for years and years, as affordable housings, while trump trys to redevelop, a 500 sq foot lot, uptown where its not wanted, and argue for a 6 story variance to 12 storys, strangly they both will wind up with the same amount of money! and probaly spend the same amount of money, not hense, 53,000 $ millionaires, up from 35,000$
must be the wrong side of the non industrial, tracks
then again fanatsy land in lost wages!
I have driven in many metro areas around the USA. I will say without hesitation that Phoenix has the worst Traffic Engineering anywhere. There is no effort made to keep the traffic flowing in a consistent way. They time the lights as if the head of Traffic Engineering owns a brake shop franchise.
keith said...
54,551 at the same time Phoenix was finishing up the 50,000 unwanted homes that were already under construction
Keith, where do you get the 50,000 new homes figure?
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