Tuesday, May 10, 2005

Phoenix Buyers Hesitate On Higher Prices

With no weather to blame, Phoenix area home resales may be running out of momentum. "The Arizona Real Estate Center Tuesday reported that the resale home market declined to 8,735 sales in April 2005 from 10,035 in March 2005, but well ahead of the 7,250 sales recorded in April 2004."

This is starting to sound like a coastal market, just without any water. "And with the increase in sales activity comes the continued hike in the median sales price, up 35 percent from $164,000 in April 2004 to the current $221,000."

A 35% increase sounds a little parabolic to me, but not to Jay Butler, director of the Arizona Real Estate Center. "The ever-higher home prices tend to sustain optimistic growth assumptions about the market, thus, both investors and owner-occupants seem to be buying on future expectations of continued appreciation."

"Butler cautioned that the higher home prices are seriously impacting affordability, especially for first-time home buyers."

11 Comments:

At 3:49 PM, Anonymous Anonymous said...

One of the guys that I work with recently took a real estate class.

He paid 6,000 for the class.

They provided him with "leads" to buy four houses in in the pheonix area.

They told him how to do 100% finance on all four house and purchase all houses simultaneously with different mortgate brokers as a "second home".

He has managed to rent the houses out.

Sounds crazy, doesn't it??

 
At 3:57 PM, Blogger Ben Jones said...

Anon,
Do you know if he has positive cash flow?

 
At 4:00 PM, Anonymous Anonymous said...

He has negative cash flow...he says that is OK because he will make money on the sale, which he intends to do within the next six months (bought the houses about six months ago).

 
At 6:47 PM, Anonymous katie said...

Crazy and fraudulent, yeah. (Misrepresentation to lenders doesn't sound like a legitimate investment technique to me.) And that guy will probably make his profit, and he and everyone around him will think he is such a fine businessman. Hope someone drops a dime on him.

 
At 7:15 PM, Anonymous Anonymous said...

I may need more than just a real estate class.

 
At 7:42 PM, Anonymous Anonymous said...

They should also investigate the promoters and teachers of the class for conspiracy to commit fraud.

 
At 8:11 PM, Anonymous Anonymous said...

I read that in the AZ area up to 50% of purchases in the 4th quarter of 2004 were by investors....is AZ really cheap, or is this the third biggest bubble in the US (behind CA and FL)

 
At 8:48 PM, Blogger Ben Jones said...

8:11 anon,
with 35% increases, it won't be cheap for long.

 
At 9:03 PM, Anonymous VegasGuy said...

Wait, wait let's do the math.
Say the homes increase 15% in value over next 6 months. After transaction costs I estimate about 15K on each house gross profit or about 60K. Don't forget to tell your friend about short-term capital gains at about 20%, so thats 48K net..... less his 6K seminar investment,that's 42K. Not to mention worrying about mortgage fraud, renting out the places, and running around. Yuk !!! I prefer the .Dotcom bubble, it was so much easier !!!

 
At 5:29 AM, Blogger Melody said...

Cleanest Air: Cheyenne, Wyo. Worst Air: L.A.

Annual State of Air Report Says Half of U.S. Cities Have Air Pollution

By Daniel DeNoon
WebMD Medical News Reviewed By Brunilda Nazario, MD
on Thursday, April 28, 2005

April 29, 2005 -- America's air quality is a little bit better. But don't breathe a big sigh of relief -- especially if you're among the 52% of American's whose air is still unhealthy.

The American Lung Association today released its annual State of the Air report, using data collected from 2001-2003. The news is a little better than last year. There was less of the worst kind of air pollution -- small particle pollution -- thanks in part to curbs on coal-fired power plants.

These efforts -- and a cooler, wetter summer in some parts of the nation -- helped reduce ozone levels, too. Ozone is the main ingredient in smog.

That's good news. But not good enough, says ALA president John L. Kirkwood.

"Dirty air threatens the lives and health of far too many Americans," Kirkwood says in a news release.

Why is Kirkwood so grumpy? The ALA report shows that:

52% of Americans live in counties with unhealthy levels of either ozone or particle pollution.
49% of Americans live in areas with unhealthy ozone levels.
1 in 5 Americans live in areas with unhealthy year-round levels of particle pollution.
17% of Americans -- more than 50 million people -- live in the 47 counties that have unhealthy levels of ozone, year-round particle pollution, and short-term bursts of particle pollution.
Most at risk from bad air:

Anyone aged 65 and older
Children
Anyone with asthma
Anyone with chronic bronchitis or emphysema
Anyone with any long-term lung disease
Anyone with heart disease
Anyone with diabetes
Worst Air/Best Air Quality

Keeping its reputation for terrible air quality, Los Angeles once again tops the list of metropolitan areas with the worst long-term particle pollution -- the most dangerous kind of air pollution.

The worst 25 metropolitan areas for year-round particle pollution (cities with the same rank are tied):

1. Los Angeles-Long Beach-Riverside, Calif.
2. Bakersfield, Calif.
3. Visalia-Porterville, Calif.
4. Pittsburgh-New Castle, Pa.
5. Fresno-Madera, Calif.
6. Detroit-Warren-Flint, Mich.
7. Hanford-Corcoran, Calif.
8. Cleveland-Akron-Elyria, Ohio
9. Atlanta-Sandy Springs-Gainesville, Ga.
10. Weirton-Steubenville, W.V.-Ohio
10. Cincinnati-Middletown-Wilmington, Ohio-Ky.-Ind.
12. New York-Newark-Bridgeport, N.Y.-N.J.-Conn.
12. Chicago-Naperville-Michigan City, Ill.-Ind.-Wis.
14. St. Louis-St. Charles-Farmington, Mo.-Ill.
15. Canton-Massillon, Ohio
15. Birmingham-Hoover-Cullman, Ala.
17. Charleston, W.V.
18. York-Hanover-Gettysburg, Pa.
18. Merced, Calif.
18. Lancaster, Pa.
21. Louisville-Elizabethtown-Scottsburg, Ky.-Ind.
22. Indianapolis-Anderson-Columbus, Ind.
22. Columbus-Marion-Chillicothe, Ohio
24. Washington-Baltimore-Northern Virginia, D.C.-Md.-Va.
24. Huntington-Ashland, W.V.-Ky.-Ohio

The best 26 metropolitan areas for year-round particle pollution (cities with the same rank are tied):

1. Cheyenne, Wyo.
2. Santa Fe-Espanola, N.M.
3. Honolulu, Hawaii
4. Great Falls, Mont.
5. Anchorage, Alaska
6. Kennewick-Richland-Pasco, Wash.
7. Farmington, N.M.
8. Tucson, Ariz.
8. Bismarck, N.D.
10. Bellingham, Wash.
11. Rapid City, S.D.
12. Grand Junction, Colo.
12. Colorado Springs, Colo.
14. Palm Bay-Melbourne-Titusville, Fla.
14. Fort Collins-Loveland, Colo.
14. Fargo-Wahpeton, N.D.-Minn.
17. Pueblo, Colo.
18. Albany-Corvallis-Lebanon, Ore.
19. Duluth, Minn.-Wis.
19. Cape Coral-Fort Myers, Fla.
21. Port St. Lucie-Fort Pierce, Fla.
22. Reno-Sparks, Nev.
23. Sarasota-Bradenton-Venice, Fla.
23. Redding, Calif.
23. El Centro, Calif.
23. Deltona-Daytona Beach-Palm Coast, Fla.

 
At 1:32 PM, Anonymous Anonymous said...

The guys is also from out of state, flew in and purchased all of the houses in one day. Rents through an agency for a fee.

 

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