Now that the 4th quarter of the year is behind us and we are moving into 2010 it appears that the bottom has come and gone. At least in some portions of our market.
There is no doubt that 2010 will a better year for the phoenix metro market though we will see more of the pain of 2009. While our market differs from area to area there is one portion that has been a bright spot over the last six months. The price points below 300K are moving very rapidly and we are seeing prices rebound in those areas. Some areas have rebounded so fast that we are now again hearing talk of another so called bubble of artificial price increases. The first time home buyer tax credit did create a lot of demand in those price points of our market. The novelty of that credit is starting to where off though we are still seeing home sell very quickly and for more money than in past years.
The upper end market will feel the pain this year! The higher you go the worse the pain. These markets have held on during the worst of times in 2008 and 2009 though I believe 2010 will be the year that there will be many more foreclosures and short sales in this portion of our market. The problem there is that there is not the same volume of buyers for the upper end product especially in today’s economy / market. You couple that will uncompetitive financing for a jumbo loan product and the outlook is not to pretty. With that said it does provide a opportunistic market for owner occupants and long term investors. You will not be able to build these homes for what they will sell for in 2010, and I am sure in 10 years we will all be saying I should have bought that house in 2010, rates were still low and we will never see those prices again.
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