Jump Starting the Greater Phoenix Metropolitan Area Housing Market

Recently, I have been working with a young couple looking to buy their first home in the Buckeye area. I believe I have mentioned this before, but it is possible to purchase a good-sized four bedroom home, less than 4 years old, for around $100,000. Some are available for even less. Coupled with the tax credit available from the government, it make buying a home a no-brainer. Especially, when compared to renting.

However, it is staggering to see that virtually all the homes for sale are bank-owned or short sales. The underlying stories behind some of these homes can be disheartening. So many of the bank-owned properties were sold just 2-3 years ago for $250,000 or so, and are now being offered at $80-100K, a loss of some 60%. Sad indeed for the families involved. However, as they say, it is an ill wind that blows no good. Consequently, buyers like my clients, who thought the possibility of home ownership had passed them by, are now getting another chance. In fact, the market out there has been so hot, and understandably so, that we are now seeing multiple offers in many cases. This can be a little frustrating, but perseverance will win the day.

I also spoke with an agent who is involved in selling some remaining new homes after the developer went bust. These homes are essentially bank-owned short sales, some only part completed. What was surprising was his tales of how long it takes some banks to respond to offers. Many, sensing the urgency, respond in a couple of days. One in particular, that I won't name (but the initials were Wachovia) had 7 active offers sitting on their desk awaiting approval for over 3 months. What on earth are they thinking? I would hazard a guess that many of those offers will be rescinded by buyers who have found a more willing seller. Who would want to miss out on buying a home due to the laziness of some pencil-pushing banker. The bank is also doing a dis-service to its shareholders by not liquidating non-performing assets. Maybe they are all too busy counting their T.A.R.P. funds.

A good time to buy, I think.