Weak housing market? I don't think so....

[JKnight]

I have no doubt this is specific to certain markets and price ranges. We are looking in the sub-225k arena. I'm sure we would have an easier time in the upper end, but I'm not at that point in my 28 year old life yet. I'm content with that though, as it's really my hobbies and friends that make my life fulfilling, not my house. Plus, I'm ok with trying my hand at household renovation since the Camaro is finished...to some extent.

When it comes down to it though, a significant percentage of the country lives in, and is shopping for, homes that are in the range in which we are shopping. The dollar value of that home will obviously vary by region, as we all know Phoenix's $200k is California's $350k (or more). Given that, I continue to be surprised at the fervor in this portion of the market.

[Vegas69]

I thought the whistle blew and I was off work.

Seriously though, I've been an agent in Vegas for 11 years and I've owned investment property in the Vegas valley and greater Phoenix area. Our markets are very similar with a stronger job market in Phoenix. I've been seeing multiple offers on reasonably price bank owned properties since 2008. Here's where it gets interesting. The market in both areas has continued to depreciate. Here's the problem. For every sale, another 1.xx distress homeowners replaces it. We have been in the 3000-4000 sales per month range for well over a year. That's exactly the same volume we had at the peak of the market. Difference, very few were in foreclosure or in a bad financial hardship at that time.

Will prices continue to decrease? Probably... Here's what I find. You can buy for less outlay per month or close with rates at 4.25% today! We have leased more properties this year than have been put up for rent. Why? All these folks that have lost their home to foreclosure or short sold their home must go somewhere. Also, many like Dave won't jump off the fence. Can't blame him.

The bottom line, it may very well make sense for you to buy now even if the market depreciates. If you lock in a rate of 4.25% now and the market depreciates 10% in 2 years, but the rates are now 6.25%, what cost you more money when it's time to sell?

Which leads me down the next road, timing is everything in Real Estate. How long do you plan to own the house? Let's say you answer 10 years, but in 5 years you get a job transfer or whatever. What is your payment vs. market rent. I can tell you now, you will likely be in the black every month. That is what we call an investment property. Your tenant pays down the principal every month and you pocket a few bucks. You sell when the TIMING is right.

See, that's what everybody forgot about in 2005. Real Estate can't go down in value, I can always refinance, everybody makes a killing. Wrong, you must put yourself in a postion where you can time the market, regardless of economical circumstances.

200k in Phoenix is well above average, unless you are in Scottsdale. My advice is not to get sucked into paying to much. Another one is coming down the pipe. One thing your agent can look for(And you better have a really good agent with a proven track record, if not, fire them and find one of I can)is a pre approved short sale or one that has been approved in the past and the buyer got sick of waiting. Everybody wants to buy bank owned and they go mulitple offer all the time. Especially around median or under. Just be careful and make sure your agent asks alot of questions. If the answers aren't right, move on. Those questions are:

Is the homeowner in default?
What is their hardship?
How many lien holders and which banks?
Are they in the hole every month?
What terms were approved in the past?(If it had been approved)

30% of short sales close due to inexperienced listing agents. Mainly, taking on short sales that don't have a chance.(no hardship) Or they just flat don't know what they are doing and sell the property way to cheap.

[Flash68]

Todd knows what he speaks of. Lots of good info there. (Surprised it took you so long to post on this one Todd. )

Too many people also just want to buy just to be "homeowners" (not saying that is you, Jeff, but just putting it out there). You know, the George Bush "Ownership Society" propaganda.

As Todd said, timing is paramount. The longer your holding period, the less important the exact timing of the buy or sale is. But I like to nail the timing on both ends as much as I can. Being one of, or the absolute, single biggest "investments" of most people's lives, people should do more research and educate themselves as much as humanly possibly on the process, stats, etc.

Best of luck in your search. Patience and time is on your side.

[JKnight]

I appreciate your input Todd. Much of what you discussed fits in with my current thinking. My "plan" is to stay there for at least five years, but it could very well end up 15. We're not looking in Scottsdale. Neither of us care about having a Scottsdale address and the club/bar scene is not important. We're more of the 'build/buy a nice backyard and have the party at your house' kind of people. Maybe down the road for our second house we will be looking for a more upscale Scottsdale locale.

With all that said, your points about the real estate agent and the questions they should be asking has me thinking I'm not working with the right person. I don't get the impression that this lady knows much about short sale/bank owned properties since I haven't heard her ask any of those questions, or provide me with the corresponding answers. I think her lack of comfort with these sales is confirmed by her gently nudging us towards traditional sales.

[JKnight]

Originally Posted by Flash68

Too many people also just want to buy just to be "homeowners" (not saying that is you, Jeff, but just putting it out there). You know, the George Bush "Ownership Society" propaganda.

As Todd said, timing is paramount. The longer your holding period, the less important the exact timing of the buy or sale is. But I like to nail the timing on both ends as much as I can. Being one of, or the absolute, single biggest "investments" of most people's lives, people should do more research and educate themselves as much as humanly possibly on the process, stats, etc.

Best of luck in your search. Patience and time is on your side.

I definitely know a few of those "homeowners", and a few of them are good friends. Part of my motivation to buy is I find myself fixing up the rentals I live in far too often, and am ready to put those efforts into something that actually belongs to me. Not to mention, I could really use the tax breaks!

I've definitely got a lot to learn, but my hope is that I can be patient enough to make a good decision when the time comes.

[John510]

Originally Posted by JKnight

So my Fiance and I are trying to buy our first house right now. I held off on buying a house out of college in 2005 because I felt like housing prices were unsustainable. Turns out I was right and it has been one of the best decisions I ever made.

We will be staying in the Phoenix area, so we figured with all of the news of the soft housing market, short sales, foreclosures, and bank owned properties, we would have no problems finding a decent place with a little potential.

Reality of the situation is that there are absolutely no indications that the housing market is still soft. Some even go so far as to call it a buyer's market. I don't think so. Every decent property has 4+ offers by the 3rd day on the market, all of which are significantly above asking (35-50%) and many are full cash offers (investors?). Its no wonder the supply of homes isn't going down. The investors buy these places up by the handful and relist them the next week for a 10% premium. Many of these places still need a good bit of work to be livable.

It's starting to seem as though there is very little opportunity for normal buyers to buy a humble house to live in. We are prequalified, first time buyers with no skeletons in our closet and USAA as a lender. Why in the sam h$ll I can't seem to buy a decent house is beyond me.

Thank you for allowing me to rant....

If you are buying with a conventional loan I would not waste your time looking at Foreclosures or REOs. The banks will take a cash offer over a loan anyday. Even on a short sale, the bank will look at the cash offer over a loan. Most houses under 200K are bought full cash these days (at least here in CA) because you can buy them for cheap and rent them. My advice is if you are paying with a loan, look for a non distressed property. I look at homes every single day and yes, they sell within days of posting. I just bought a condo 2 weeks ago and it had 8 cash offers within 2 days of listing.

[TimeWarpF100]

Originally Posted by JKnight

So my Fiance and I are trying to buy our first house right now. I held off on buying a house out of college in 2005 because I felt like housing prices were unsustainable. Turns out I was right and it has been one of the best decisions I ever made.

We will be staying in the Phoenix area, so we figured with all of the news of the soft housing market, short sales, foreclosures, and bank owned properties, we would have no problems finding a decent place with a little potential.

Reality of the situation is that there are absolutely no indications that the housing market is still soft. Some even go so far as to call it a buyer's market. I don't think so. Every decent property has 4+ offers by the 3rd day on the market, all of which are significantly above asking (35-50%) and many are full cash offers (investors?). Its no wonder the supply of homes isn't going down. The investors buy these places up by the handful and relist them the next week for a 10% premium. Many of these places still need a good bit of work to be livable.

It's starting to seem as though there is very little opportunity for normal buyers to buy a humble house to live in. We are prequalified, first time buyers with no skeletons in our closet and USAA as a lender. Why in the sam h$ll I can't seem to buy a decent house is beyond me.

Thank you for allowing me to rant....

Phoenix area is a very tough market to buy right now as a lot of Canadian and other investors are buying them up.

We sold our home in spokane after 5yrs of trying. Thought it would be cake walk to buy a place with over 50,000 homes listed. Problem is when you take out HOA there are under 9000 left. Add in a pool or shop and very little left.
I have made 6 trips to Phoenix to find a place. 1st offer was 375 on a short sale that seller approved of. Bank said no... Less than 30days later the bank sold it for 288k and then was turned in under a week for 320k. Smelled for an inside job of sorts.

We have looked at well over 100 homes in phx area. The ones with decent pricing as you say are getting offers well over asking price. Recently bid well over asking price on a Bank owned home only to find even though we were high bidder the bank came back and said they were taking highest and best and gave us less than 3hrs to bump our bid. Because the property had major zoning violations and the bank would tell us nothing we refused to raise our bid and it was awarded to someone else.

Time and time again I am seeing houses in phx area selling for less than my bid as the banks are so crooked trying to bump them. Kind of like a car dealer asking a certain price then you offering more and dealer not selling, crooked to say the least.

Most of my stuff is now in phx and the final move is this tuesday. I have no idea where I will be staying until a place is found.

I was quoted 30k plus for the move plus 5 vehicles, bought my own Semi which is also being used for storage. Waiting game to find something.

Good luck with your purchase!

[John510]

Originally Posted by ratman67

http://www.mortgagenewsdaily.com/wik...abase_List.asp

check this link to bank real owned properties, these are properties the banks tried to auction and couldn't sell, they need to unload em so you might find a sweet deal...good luck

You can NOT buy a REO with a conventional loan. Cash Only

[GregWeld]

I'm trying to buy a 70MM building..... the builder (Starbucks) spent $422 per sq foot to build - and the asking price is $243 per square foot... it's a 287,853 sq ft building.

There are no "trick" financing deals -- and the winning bidder will have financing in place and a buttload of cash or they won't even look at the offer. And there are plenty of people willing to bid. No shortage of buyers just a shortage of REAL buyers.

[Blake Foster]

Originally Posted by GregWeld

I'm trying to buy a 70MM building..... the builder (Starbucks) spent $422 per sq foot to build - and the asking price is $243 per square foot... it's a 287,853 sq ft building.

There are no "trick" financing deals -- and the winning bidder will have financing in place and a buttload of cash or they won't even look at the offer. And there are plenty of people willing to bid. No shortage of buyers just a shortage of REAL buyers.

what are you going to do with 287,853 Sq FEET!!!???? lol