Bubble Busting Phoenix
Congratulations are in order to Bill Buckner for breaking the story about 14,601 Vacant Homes in greater Phoenix area.
Recently, it was reported in the Phoenix market that the number of homes available had jumped from apx3400 homes January 05 to over 30,000 this January. As we watch some of the markets around the country, looking for signs of "the bubble", this number was astounding. As a member of the "Arizona Regional Multiple Listing Service"(ARMLS) I thought I would check for the accuracy of this claim. By the way ARMLS is known to the local realtors as "armless". Funny. In running some stats this morning, there are 33,270 active listings in the MLS. This covers greater Phoenix as well as a bit of outlying area. Another 1,225 are active/contingent. Under contract, but still being marketed for a buyer. There has been a lot of talk of speculation in the Phoenix market, which made me wonder, how many of these homes are vacant. Of the 33,270 active listings, 14,601 are vacant. 14,601, almost half. Wow. Why?? A lot of the "flippers" that bought new homes did not want to put tenants in, so the homes could be marketed as new, never lived in. Move up buyers bought first for convenience/speculation, putting the old home on the market later. People buying 2nd/speculative homes. The high number of vacant homes appears to be the result of this speculative fever that has hit Phoenix, just like many markets.
This has led to the unsustainable increase in home values, as the investors no longer enter the market. And a 10 fold increase in inventory as the speculators decide its time to get out while the gettins' still good. I have no year over year comparison for the vacant homes, or info on what is "normal", just a gut feeling that this doesn't bode well for the market.
Ben Jones picked up the story on The
Housing Bubble Blog.
Here are some of the comments:
I had tried to ask this MLS if the rumors were true and they wouldn’t reply.
It is a dust bowl here today. The wind is roaring and kicking up dust everywhere from the plowed fields around gilbert. It is an unbelievable scene here right now. Driving home from barnes and noble I was worried my truck would have the paint sand blasted off. There are 50 homes for sale in my subdivision and most are at least 50000 overpriced. More homes keep coming on the market everyday.
Just for fun I looked up the number of houses for sale in Queen Creek. 2,200. If you look on Craigslist there are dozens of them and most say “new home, never lived in". The Craigslist ads are starting to sound desperate.
The New York Times is reporting In Phoenix, Even Cactuses Wilt in Clutches of Record Drought.
PHOENIX, March 9 -- Thursday began like the 141 days before it, sunny and crisp, dust settling everywhere except on the record -- set again -- for the number of days without rain.
"We have cactus dying from lack of water," Mr. Woodard said. "We have well-established mesquite trees that are in a lot of trouble."
Small animals are too dried out to do what comes naturally.
"None of the animals, none of the birds are having offspring this spring. No baby quail, no baby bunnies," Mr. Woodard said.
An alarming result of the drought is the condition of the air. On Thursday, Arizona's Department of Environmental Quality posted its 25th pollution advisory of the winter, a remarkable number. Last winter -- the opposite of this one, with abundant rainfall -- there were no such days. There is no rain to knock the dust and particles out of the air and wash them away.
"We've just had this large, dry, stagnant air mass hanging over the area since November," said Steve Owens, director of the environmental agency. "It used to be, you'd come to Arizona if you had breathing problems because of the air quality. Now, I think you'd have physicians who would say, 'Don't come to Arizona.'"
What happens if the La
Nina dust bowl pattern lasts for another year?
What about 5 years?
Heck, what happens to the water table in 10 years even IF things return to normal?
Perhaps those in the snow belt get the last laugh.