climbermom

Hi...hope someone can help. We are considering a relo to the Scottsdale area, and really having a tough time getting a handle on the market here.

I know that the number of listings in Maricopa County is at an all-time high, and sales are down. The local realtors are very closed mouth about prices dropping, however. We have looked at a dozen or so luxury homes in Paradise Valley and North Scottsdale, in the 2 to 8 million dollar range -- and most of it seems to be wishful thinking on the seller's parts. One house in particular for $3 million had a $3 million mortgage on it.

Anyone have any knowledge to share?

BTW, I am an agent in NJ, and this will be my 3rd relo in 10 years, so I'm not totally clueless.

Landing Gear

Every time I visit, I see new building, particularly in north Scottsdale. There are even homes going up at the entrance to the Four Seasons.

Of course, as the mortgage market gets tighter, there may be an effect on prices in locations like Scottsdale where there seems to be an excess of supply.

(I am a commercial RE lawyer in New York. I merely visit Scottsdale. I'll be there for Labor Day.)

FlyinMike

North Scottsdale and PV are the most expensive markets in the state. There are deals to be found, you just have to search a bit, and be willing to look at other areas. You're buying the zipcode in these two locations more than you are the house.

I find it ironic that a $3million house has that much mortgage on it. Bet that person owns a Hummer and a BMW. You might want to wait another 6 months and wait for the next round of foreclosures and short-sales to kick in. You won't see prices drop by 40%, but a 10 - 15% drop is certainly possible in the next 12 - 24 months.

They keep saying it's a buyer's market in Phoenix, but some people have mortgaged themselves so deep, they can't afford to come down on the price and pay off the debt on the house. They'll probably end up walking, or at least doing a short-sale in the coming months.

schistosomiasis

One useful tool is azcentral.com/realestate
this will let you search by zip codes, property values, or some combination
My feeling (I've just bought something, although not in your price range) is that higher end homes in desirable areas like PV or Scottsdale aren't as affected to the same degree as the entry homes for first time buyers on the fringe of the valley (Sun City, Anthem, etc). The internet site listed above should have some articles about Phoenix real estate....

Landing Gear

Wait a minute.

You're looking at $2-8 million range? That's a pretty big spread. Most people do not have a 400% gap between their top and bottom figures.

How is this possible?

By the way, I was in Scottsdale and the surrounding areas over Labor Day and there are many unbuilt tracts (Toll Brothers has a lot along with other builders) and plenty of unfinished construction.

I smell a buyers' market coming, if it isn't already there.

sonoranjerseygirl

Scottsdale, PV, and to a lessor degree some parts of Desert Ridge in Phoenix are still high in the price range. I'm currently renting in the area, and when we looked into buying up here, we were priced out immediately. The problem, pretty much all over the Valley, is most people who are doing resale are still expecting to get the prices they paid three-five years ago. While the house I'm buying is no where near the 2 million mark, we found overall it was better to build rather than to buy a resale. The builders have realized the bust is over, and are throwing in tons of incentives into the house...but I also suppose that wouldn't matter either.

climbermom

It's possible because we can pretty much afford to spend whatever we want on a house.

Originally, we thought we'd get more house for the money, moving from the northern NJ area, and started looking at around $2 million -- but that really wasn't the case, and we upped our range to $3-5 million. We have cars and dogs and our main criteria is privacy with a big piece of property.

We wandered into an open house that was $8 million, without knowing where it was priced -- we followed signs, checked in at the gate (Prado) and walked through the 10,000 square feet on our own. I also looked at the Toll Brothers' homes -- 6,000 square feet on less than an acre. They are offering incentives of hundreds of thousands of dollars -- but I don't want to look into my neighbor's pool for any price. The builders' homes were priced better, but still very high it seemed.

number_6

Historically the PHX market has been very volatile -- it had some of the biggest drops in house prices in the early 90s, when the last bubble burst. Worse than Houston, for example. The past decade has seen a lot of growth in PHX, and the PV/Southern Scottsdale area is pretty much built out (while lots of desert left 10 miles north). So prices have doubled and tripled for those million dollar homes in the past 5 years; lots of runup and lots of ambiguity as to what the market is worth. I have spent a fair bit of time in PV and have lots of friends there, and it has a special twist: a lot of LA money has moved into PV, particularly at the high end, including lots of somewhat shady money (porn and drug industries). PV is sort of old-Hollywood West.

If you want space, privacy and value, you might want to look into Carefree and Cave Creek (just north of Scottsdale and much more rural and much more of the old west).

medic

the other option is to head south, unless you really want the scottsdale scene. there are large swaths of open lots and land in gilbert. great views of the santan mountains.

lot of development happening in the area, so need to make sure you know what's zoned for around you, but many private and gated areas are there. very much a buyers market in this area though, so offering at least 10-20% below asking would seem fine to me for what some people are still asking.

climbermom

Thanks for the info...as of right now, we are not going to Arizona. I'm leaving in a few hours to check out the Los Angeles housing area. Unfortunately, I know all I really need to know about this market: I can't afford to live there!

biggestbopper

With all respect to the OP, this is not really an FT topic. Perhaps in the OMNI forum ....

DenverBrian

Even in Beverly Hills, you can find houses for under $8 million.

zz7777zz

Bump, for a May 2009 update on Scottsdale...

climbermom

The $8 million house I referred to in an earlier post is still available, and now priced under $6 million. The builder will also take a trade. The Toll Brothers homes I looked at are now listed at half of the listing price from September of 2006.