The Housing Bubble in Arizona

[MJLO]

What parts of Arizona are suffering the most from the housing slowdown? I think Mesa is up there but that's all I can think of.

[colin]

Houses squeeze out farms

The article is a little biased in interviewing the director of the state Department of Agriculture. But it, again, brings up the point I was trying to make: is farmland really better than "concrete"? The land is already bladed, but instead of crops sucking down water and poisoning the watershed, you have suburbanites...sucking down water and poisoning the watershed.

Red Rock Village in Pinal County is a really good example, although almost all new development in the Phoenix area follows that pattern: housing is on that flat, "good" farmland.

[MJLO]

Well the problem is not the polution generated by farms. The problem I see, is, what happens when developement pushes out farmland and we have no more food left?

[convulso]

Well the problem is not the polution generated by farms. The problem I see, is, what happens when developement pushes out farmland and we have no more food left?

[MJLO]

Home Prices rise 13.4 percent in Maricopa County.

Definately a slowdown from the boom years. But still not bad. Don't know what the scenario will be next time assessment figures are released.

[MJLO]

Why is there such a huge emphasis on homesales? Was that a giant catalyst for people moving to the valley? The growth seems to be the strongest ever. I still don't understand that with all these people moving here, how the housing market slowed down. You would think we'd need all these extra houses. I want to know what can be done.

[colin]

A lot of the home purchases were just speculators, mostly from California. "Oh, it's so cheap here! We'd be stupid not to buy!" And now they're stuck with a house that's worth 10-20% less than what they paid for it since it's not new. In Tucson they've been trying to rent them out.

[uconn99]

As I said in the second post of this thread, I work for a large home builder doing technology sales. Over the past 2-3 months we have seen a rise in the amount of appointments in the design center. If you don't know how most of these large track home builders work, they have a sales division and a design division. The sales people usually sell the homes on site in model homes and then the people go into the design center and customize their house for things like flooring, cabinets, fixtures, and tech stuff like audio/data/video.

Back in July the design center was seeing a average of around 5-7 buyers a day. For the past 1-2 months that has risen to 9-11 buyers a day and for the past couple weeks we see on average 10-12 buyers a day with some days as many as 15-17. I know this isn't a sign of the industry as a whole, but it does seem as though it is picking up a bit once again!

[MJLO]

it's hard to say, there is market saturation from what I understand, but the valley has also gained almost 800k residents since 2000. that's pretty huge, so it can't be that bad.

[colin]

Speaking of wealth, something interesting I found on Wikipedia:

http://en.wikipedia.org/wiki/Arizona_locat...r_capita_income

Scroll down a little for the communities ranking and check out #4, 5 and 6. Interesting...

Of course, this was probably 2000.

And bonus points for those who actually know where Rio Verde is (hint: it's logically named).

[MJLO]

I love that kind of thing. AZ ranks 29th nationally out of the fifty states for percapita income. I wonder where metro Phoenix ranks, nationally. Because with out the Metro areas of Tucson and Phoenix, AZ would be below Mississippi

[colin]

Out of 361 metro areas in 2005:

Phoenix-Mesa-Scottsdale: 117

Tucson: 227

Source: http://bea.gov/bea/newsrel/MPINewsRelease.htm

[colin]

This thread seems to have mostly been me as Devil's Advocate on the ultra-pessimist side while others insist "No! The housing market is still great!"

But:

Tucson home firm files for Chapter 11

[MJLO]

I don't think the housing market is still great. It makes some sense to me, people were using the realestate market out here to get rich quick. Lenders got predatory, people made bad decisions, so the market inflated itself to much. It's just a natural correction being made to bring the market back to a reasonable area it should be at. You can't double the value of your house in a year anymore. Well where else can you do that? Can you imagine how bad it would be if people were no longer moving here in droves?

[colin]

Huckelberry seeks half-cent Pima sales tax

Huckelberry (Pima County Administrator) wants to lower property taxes and raise sales taxes.

I'm glad that some people live in a world where things like this actually sound feasible.

[traal]

That's fine, but I wish they would figure out how much each property actually costs the county, and charge that much for property taxes (plus a little extra for services the city wants to subsidize). Do the same for sales tax. Otherwise someone is making up numbers out of thin air just to balance the books, and nobody can really say if property taxes are too high or sales tax is too low.

Do I sound bitter? I've recently escaped from Mesa, where the property taxes ($0) are almost certainly too low, and the city is running out of money.

[traal]

Realistic prices help ailing home market

Is this the end of the bubble?

...the spread between what Valley home prices sold for in March and what they were listed for is the narrowest it has been since mid-2004.

[colin]

I don't think you'll find many Arizonans sympathetic to the "investors".

But, yeah, hopefully this whole thing about paying $300k for a 3-bedroom KB in Queen Creek is over. I don't think prices will go down, but they'll certainly start to level out, which will actually end up hurting the Phoenix economy since it's grown so reliant on this bubble.

[colin]

Study says Phoenix among riskiest real estate markets

Not sure if the list ("Riverside, California; Phoenix, Las Vegas and West Palm Beach, Florida") is in order.

The thing is, this study is just saying "We think prices in these markets will drop."

DUH!

[colin]

Foreclosures in Phoenix area make biggest jump of year

In August, foreclosures climbed 36 percent. That amounts to nearly 1,100 people who lost their homes.