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Phoenix Housing Market Hit By Unprecedented Plunge In Demand

Tyler Durden's picture




 

The Phoenix housing market has a special place in the heart of housing bubble watchers: together with Las Vegas and various California MSAs, this is the place where the last housing bubble was born and subsequently died a gruesome death which nearly brought down the entire financial system. Which is why the monthly WP Carey report on the Greater Phoenix Housing Market is of peculiar interest for those who want to catch a leading glimpse into the overall state of the bubble US housing market. As hoped, this month's letter does not disappoint. What we find is that while equilibrium prices have been largely flat month over month, and are up 6% on an average square foot basis from a year ago, something very bad is happening with a key component of the pricing calculation: demand has fallen off a cliff.

Some of the disturbing findings from the report:

Demand has been much weaker since July 2013. The slight recovery in demand that had been  developing over the last two months dissipated again in May. While move-up owner occupiers and  second home buyers are starting to compensate for the departure of investors, activity by first time home buyers is unusually low.

 

At the top end of the market sales of single family homes over $500,000 grew 1% over May 2013. Sales of single family homes below $150,000 fell 37%. This fall was partly caused by the lack of distressed supply, but mostly by the reduction in demand from investors.

 

 

The market over $500,000 was much weaker in May than it was in April, with a 15% drop in dollar volume compared with a year earlier. However it is the market below $150,000 that has contracted the most dramatically. The relatively low volume of low-priced home sales is causing the monthly median sales price to rise.

 

Luxury homes over $500,000 went back to a 24% market share, the same as in May 2013. The lowest-priced homes under $150,000 fell from 15% to 11%. The mid range has increased its share of spending from 61% to 65%, despite a 9% decline in dollars spent. Contrary to what is often stated in the national media, demand is nowhere inhibited by supply shortages, unlike in April 2013 when supply was severely constrained.

So how is it that prices aren't crashing to keep up with (lack of) demand? For now the sellers are simply staying put, and not rushing to lower their prices even as supply remains largely stable despite slumping demand for housing. As the Carey report summarizes "Although buyers now have more homes to choose from and much less competition from other buyers than in 2013, supply has not become excessive." At least not yet.

Here one could be philosophical and note that just like the S&P 500, the leading bubble housing market is merely suffering from a case of the CYNK (henceforth halted until perpetuity just so the SEC can stick its head in the sand and pretend it never heard of that particular fraud): with a plunging number of transactions, price discovery is becoming a farce.

And plunging they are:

  • The percentage of residential properties purchased by investors continued to decline from 16.3% in April to 16.1% in May.
  • Single family home sales decreased year over year across every sector:
    • Normal re-sales (down 2%)
    • New homes (down 4%)
    • Investor flips (down 53%)
    • Short sales and pre-foreclosures (down 73%)
    • Bank owned homes (down 20%)
    • GSE (Fannie Mae, Freddie Mac, etc.) owned homes (down 44%)
    • HUD sales (down 76%)
    • Third party purchases at trustee sale (down 59%)
  • Foreclosure starts on single family and condo homes fell 8% between April and May, which confirms a continued declining trend. They were down 47% from May 2013.
  • Recorded trustee deeds (completed foreclosures) on single family and condo homes were up 9% between April and May but down 50% from May 2013.

What is just as interesting is the ongoing decline in out of state purchasers, cash buyers and investors:

Out of State Purchasers

 

The percentage of residences in Maricopa County sold to owners from outside Arizona was 20.1% in May, down from 20.8% in April but still the second highest percentage since June 2013, though lower than the 22.0% we saw in May 2013. Californians have reduced their market share from 4.7% to 4.1% over the last year but retained their normal position as the largest group of out of state buyers. Canadian demand has plummeted from 2.6% to 1.5% over the last 12 months, which about the same as buyers from Colorado which was the source of an unusually large number of buyers in May. Washington, Illinois, Minnesota, Texas, Michigan and New York provided the next most numerous home locations for home buyers in Greater Phoenix during May.

 

Cash Buyers

 

For some considerable time, cash purchases have been running at an unusually high level but this has been on a declining trend over the past year. In Maricopa County the percentage of properties recording an Affidavit of Value and purchased without financing was 25.0% in May 2014, significantly down from 32.3% in May 2013. We consider 7% to 12% the normal range for cash buyers, so mortgage lending still has a long way to go to get back its normal share of the market.

 

Investor Purchases

 

The percentage of individual single family and townhouse/condo parcels acquired by investors in May 2013 and May 2014 are as follows:

 

 

These percentages are the lowest we have seen for many years and are now close to the historical norm. The steep decline over the last 12 months confirms that investors are no longer driving the market the way they did between early 2009 and mid 2013.

Finally, the Outlook:

The resale market is currently delivering a fairly low number of new listings to market compared with historic norms over the last 15 years. Some home sellers appear to be cancelling their listings and waiting for another time when buyers have a greater sense of urgency. Many families are choosing to stay in their homes longer than they used to 10 to 15 years ago. Some owners still have either negative equity or only a small equity position which discourages both buying and selling. Others have low interest rates that they don’t want to lose, and as they cannot apply their mortgage to a new home, it is cheaper to stay put. These trends are likely to stay in place for a while now that house prices have stabilized.

 

In May 2014 the Greater Phoenix housing market had sellers outnumbering buyers but the numbers of both were well below normal. For the prime spring selling season things were remarkably quiet. Supply has stabilized at a level which is about 10% below normal and is starting to weaken, an encouraging sign for sellers. However, except at the lowest price ranges, we still have more supply than necessary to meet the weak demand which is about 20% below normal. In May 2014 every category of single family sales had lower volume than in May 2013, even normal re-sales which were down 2%.

 

Currently there is little movement on home prices in either direction. However the mix of homes that are selling has changed a lot in the past 12 months. There are fewer distressed homes and far fewer homes priced under $150,000. This tends to push the averages and medians upward even if prices are stable.

 

Compared with April, sales of luxury homes were weaker in May, but we think this is mostly normal month to month variation and expect them to recover somewhat in June. However it is likely that this will fade during the hottest months of July through September when the luxury, snowbird and active adult markets tend to go relatively quiet.

 

...

 

Single family new home construction and sales are well down from last year, contrary to everyone’s expectations in Q4 2013, and they remain about 65% below what would be considered normal for Central Arizona. Population and job growth are not back to their peak levels but have recovered much further than home construction has. People have been sharing homes and renting instead of moving out and buying. All trends in housing tend to be cyclical and this one is probably no exception.

 

With investors pulling back from the low end, the weak demand from first time home buyers has come into sharp focus. But as lenders start to ease up on underwriting restrictions this market is likely to expand from its current extreme lows. Once this happens we shall probably be talking about the low supply again. Between 2012 and 2013 we experienced a chronic housing shortage in Greater Phoenix. This shortage has not gone away. It has just been masked by the unusually low demand between July 2013 and now, and this state of affairs is likely to be temporary.

Here one could be an optimist and agree with the following: "There is plenty of pent-up demand which could emerge at any time... But for the time being, the market remains unbalanced in favor of buyers and if demand does not pick up soon then the next likely alternative will be a fall in the supply as more sellers decide to wait for better times. Unlike 2006 there is very little likelihood of a massive increase in supply creating strong downward pressure on prices."

That is, unless all those who are locked in their houses max out their credit cards and run out of ways to fund their lifestyle and, contrary to traditionally wrong expectations, are forced to sell. Considering the collapse in demand, what would happen then would be nothing short of an avalanche.

Regardless of what a plunge in demand translates into on the pricing front, it is becoming evident that little by little not only fraudulent microcaps (which succeed in ballooning their market cap to over $5 billion before being halted), but also the S&P 500 and the US housing market itself, are becoming "Level 3" assets: with virtually no transactions to determine the equilibrium price, the value of ever more assets is now in the eyes of the central-planner.

Full WPCarey report here

 

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Mon, 07/14/2014 - 15:52 | 4956590 Itchy and Scratchy
Itchy and Scratchy's picture

Hmmmm.....who doesn't want to live in a desert with no water?

Mon, 07/14/2014 - 16:00 | 4956636 NidStyles
NidStyles's picture

It's hot, that doesn't mean there is no water.

Mon, 07/14/2014 - 16:07 | 4956667 StacksOnStacks
StacksOnStacks's picture

Prices can go... down?

Mon, 07/14/2014 - 16:13 | 4956685 Winston Churchill
Winston Churchill's picture

They are here in South Florida.

10-15% off asking on the ones not underwater where they can't drop without a short sale..

Just started in the last month.Now just about all are starting to discount on my

zillow updates.Sub $1m housing.

Mon, 07/14/2014 - 16:15 | 4956695 12ToothAssassin
12ToothAssassin's picture

Aztlan

Mon, 07/14/2014 - 16:23 | 4956731 jbvtme
jbvtme's picture

aridzona conjurs images of illegal aliens, psychotic cops and recycled toilet drinking water. good luck with that housing market

Mon, 07/14/2014 - 17:50 | 4957067 Chief Wonder Bread
Chief Wonder Bread's picture

It doesn't matter that, for a big country, the U.S. has the best real estate on planet earth (not including Arid Zone-a). There have been too many national policy errors over the last 40-some-odd years and when it crashes, it's going to be ONE hellava 'come-to-Jesus' moment.

Mon, 07/14/2014 - 18:00 | 4957090 CheapBastard
CheapBastard's picture

Intense heat, serious crime, high pollution, dry desert .... what's not to like?

 

I took a job there back in the 1990's and soon hated every minute of it there. the job was great but Phoenix was horrible. I finally decided to move when they found a woman's head lopped off in a trench nearby. He rbody and her bicycle were found several meters away in another dirt dry trench.

 

 

Mon, 07/14/2014 - 20:57 | 4957604 Keyser
Keyser's picture

Phoenix  was the canary in the coalmine in 2008 housing collapse... Look at is as a leading indicator, as if it were not obvious to anyone with a brain that the economy is in the toilet and we're heading for something much worse than 2008... 

 

Mon, 07/14/2014 - 22:13 | 4957757 knukles
knukles's picture

Wait!  There's More!
More people flooding the southern borders of Amerika and soon, what with Section 8, they're going to be renting houses smack fucking dab right next door to you!
More Demand for Housing!
Go Long Phoenix.
As well as Phonics, Ebonics and Espanoics, if you get my lilt.

 

No standing 8 count
No saved by the bell
Only the fucks in DC can stop the fight

Mon, 07/14/2014 - 22:18 | 4957770 maskone909
maskone909's picture

Ot but...

http://parlourmagazine.com/2012/05/saved-by-the-bell-lisa-turtle-plastic...

Black chick from saved by the bell done lost her mind

Mon, 07/14/2014 - 21:36 | 4957679 Freddie
Freddie's picture

You must be a friend of mine.  Too a "good" job in PHX in the early to mid 1990s.  He came back to visit and our little gang was horrified because he looked like Rock Hudson before he died.  He is hetero.

He hated PHX and we guess he probably drank heavily and chain smoked.  I think he took up smoking out in that hell hole.  He moved back and within about 2 months he looked normal and was back to normal. It was the weirdest thing.  We all thought he was going to die.

Mon, 07/14/2014 - 22:15 | 4957701 maskone909
maskone909's picture

Dude Phoenix sucks! Who the hell wants to live in a god damn oven overrun with violent drug traffickers!?! In the words of the late great richard simmons, "STOP THE INSANITY!"

Edit

Susan powter was the stop the insanity broad
Hilarious
http://youtu.be/ZjfB4qDx3RM

Mon, 07/14/2014 - 17:27 | 4956982 RobD
RobD's picture

Zillow has some weird stuff going on in my neck of the woods. My house has been tanking about 3k a month for about six months now with my neighbors going the other way. I looked a couple of weeks ago and bam my house is up 15k in the last 30 days and now my neighbors prices are tanking.

Mon, 07/14/2014 - 21:03 | 4957622 toady
toady's picture

Me too. You can't take zillows "zestimates" seriously, but I think they should try to be realistic.

Mon, 07/14/2014 - 16:10 | 4956679 Save_America1st
Save_America1st's picture

Remember in Aliens part 2 when they were watching the swarm of aliens on the radar heading to their hideout before they busted in through the ceiling? 

That's Phoenix and many other southwest cities as the illegal invaders move in and are handed the keys to all those Fed Gov-owned foreclosed homes.

Game over, man...GAME OVER!!!

https://www.youtube.com/watch?v=dsx2vdn7gpY

Mon, 07/14/2014 - 16:29 | 4956749 p00k1e
p00k1e's picture

Instead, entertain the following.   Notice the non-stop illegals.  

Matrix Revolutions Attack Scene

 

http://www.youtube.com/watch?v=5q5rsQJpGV0

Mon, 07/14/2014 - 22:17 | 4957767 JuliaS
JuliaS's picture

Zionists to the rescue.

Mon, 07/14/2014 - 16:43 | 4956797 johnconnor
johnconnor's picture

I say we nuke it from orbit, it is the only way to be sure

Mon, 07/14/2014 - 16:52 | 4956837 August
August's picture

 

>>>Game over, man...GAME OVER!!!

You've had your time.  The future is our time.

The USA will be a greatly different place in six months.

Mon, 07/14/2014 - 18:35 | 4957215 Sudden Debt
Sudden Debt's picture

Februari... Another polar vortex inch of snow that will cripple the country :)

Mon, 07/14/2014 - 21:37 | 4957685 Government need...
Government needs you to pay taxes's picture

The age of men is over, the time of the Marxist orc has come.

Mon, 07/14/2014 - 16:58 | 4956856 teslaberry
teslaberry's picture

bill paxton is one of holywoods most under-rated actors. 

 

watch a simple plan if you have not. excellent acting. billy bob thorton is good in that too.

Mon, 07/14/2014 - 17:08 | 4956890 NidStyles
NidStyles's picture

Uhh, dude... Arizona has always been Hispanic dominant. The only time when white people were in a sort of "majority" was during the housing boom of the early 2000's. This is pure Espanol territory here.

 

It's too bright and too hot for white people here, and the only reason white people move here is because of the lack of rain and humidity for their arthritis. I've lived here since 2002, and my brother-in-law has been here almost his entire life. It's always been this way here. If it were not for the Hispanics there would be no Phoenix at all. 

Mon, 07/14/2014 - 17:31 | 4956994 disabledvet
disabledvet's picture

Actually you have a huge Navajo and Hopi population out there too. "Whole bag of mixed nuts."

This is all looking more and more like a Clint Eastwood flik by the minute now.

What's that movie where he orders the town to paint it red again?

Mon, 07/14/2014 - 18:16 | 4957157 CunnyFunt
CunnyFunt's picture

High Plains Drifter

"Senor, can we come to the fiesta?"

"No."

Mon, 07/14/2014 - 21:58 | 4957724 NoDebt
NoDebt's picture

In the end, after all the plans are laid and preps made for the baddies to get ambushed.... he just leaves.  They're all expecting him to stay and shoot it out with the bad guys along side of them, but he doesn't.  Just rides out.  So long, see ya, good luck.

Probably something to be learned from that.

Mon, 07/14/2014 - 18:35 | 4957216 NidStyles
NidStyles's picture

Not nearly as large as people assume.

Mon, 07/14/2014 - 18:46 | 4957261 zyby
zyby's picture

Meh, prices are up, and the arbitrary $150K is not, hence fewer sales in that bucket. Poor and misleading analysis here.

Mon, 07/14/2014 - 16:06 | 4956660 Sudden Debt
Sudden Debt's picture

The scorpions like it there... It's ideal to grow up your kids and you don't have to waste money on pets.

Mon, 07/14/2014 - 17:09 | 4956902 NidStyles
NidStyles's picture

Not really. Scorpians are only around yards that runn sprinklers twice a day like morons growing foreign grass and attracting insects that scorpians prey on.

Mon, 07/14/2014 - 18:25 | 4957189 Professorlocknload
Professorlocknload's picture

How do they differ from Scorpions?

Mon, 07/14/2014 - 18:36 | 4957219 NidStyles
NidStyles's picture

Yay! Lame jokes about typos....

Mon, 07/14/2014 - 18:36 | 4957217 Sudden Debt
Sudden Debt's picture

So... Only showoffs have scorpions... i see a market there...

Mon, 07/14/2014 - 18:41 | 4957240 NidStyles
NidStyles's picture

Mainly mid-westerners and easterners that come here hating insects but want green grass for some stupid reason. Grass is a weed, but people think it looks good...

 

Not as bad as all of the invasive trees that the same type of people plant everywhere that attracts everything with stingers and teeth. There's this Japanese tree that is all over some neighborhoods, it leaves these sticky sap covered leaves everywhere. Not sure who thought it was a good idea to start planting those things, all I see are those leaves covering the ground everywhere so the nasty things can hide in the open during the day...

Mon, 07/14/2014 - 22:23 | 4957787 thamnosma
thamnosma's picture

Gotta agree with you there.  If those fuckers want it to look like Wisconsin, then stay the hell IN Wisconsin.  At some point they will be forced by mother nature to stop it.

Anyway, Phoenix should be nuked.  There's no reason for a city of millions in the driest part of the country.  Same for Vegas.

Flagstaff, Prescott, Show Low -- eons away from the south.  Pretty livable.

Mon, 07/14/2014 - 18:57 | 4957289 Not My Real Name
Not My Real Name's picture

The Scorpions like Arizona so much they wrote a song about it.

https://www.youtube.com/watch?v=5VIphEl5xFY

Mon, 07/14/2014 - 16:08 | 4956674 Berspankme
Berspankme's picture

Forward

Mon, 07/14/2014 - 16:13 | 4956687 813kml
813kml's picture

I think it's time to officially turn Arizona into a draconian penal colony, it's already halfway there.

Mon, 07/14/2014 - 16:18 | 4956710 BlindMonkey
BlindMonkey's picture

Arizona as the Austrila of America.  I like it.  Good thinking.

Mon, 07/14/2014 - 16:27 | 4956740 Jumbotron
Jumbotron's picture

GREAT NEWS !   Now housing will be SOOOOooo much cheaper for all the GuatalaMexiColumbians coming over the border.

BULLISH !!!

Mon, 07/14/2014 - 16:52 | 4956834 migra
migra's picture

Its 100 degrees at 3AM. Whats not to like?

Mon, 07/14/2014 - 20:44 | 4957565 Jerk_Store
Jerk_Store's picture

But it's a dry heat

Mon, 07/14/2014 - 17:13 | 4956923 Freddie
Freddie's picture

Phoenix is a real shithole which will be overrun by illegals thanks to Obama, McCain, Jeff Flake and their patron Lester AIPAC Crown.

Scottsdale is a little bit better but PHX is hell on earth in the summer.  Sheriff Joe is awesome and the only man who stood up to Obama and Holder.

Mon, 07/14/2014 - 18:42 | 4957246 RmcAZ
RmcAZ's picture

Sheriff Joe is a moron who is only trying to advance the growing police state.

Mon, 07/14/2014 - 21:15 | 4957642 toady
toady's picture

I can see the police state comment as at least partially true, but the real deal with sheriff Joe is that he's an attention whore. A day can't go by without him on the local news doing his tough guy act.

He really got the old white retirees behind him with his tent city, cost cutting stuff back in the day. Now he keeps losing hundred-million dollar lawsuits and no one cares. All the money he saved with tent city has been lost 100,000,000,000.00 times over to the feds, ACLU, lawyers, and families of the victims he has killed.

Mon, 07/14/2014 - 22:20 | 4957774 knukles
knukles's picture

Yeah, but Good Olde Sheriff Joe is My Kinda Totalarian Marshall.
Y'all gottan ID fo' me boy?  Whatju say?  I don' give a rats ass if yo name is BarackI asted yo ass fo an ID.  Boy.

Tue, 07/15/2014 - 17:14 | 4960535 IdiocracyIsAlre...
IdiocracyIsAlreadyHere's picture

There are no such thing as good Totalitarians no matter how much you agree with their pet cause.  Sheriff Joe is an authoritarian asshole and an attention whore who does more harm than good.  You embrace that mindset and eventually it is you that is in their crosshairs.  Can't have any independent thought in the eyes of a high authoritarian follower - "Your papers please" is not a good reality ANYWHERE.

Mon, 07/14/2014 - 15:54 | 4956591 wee-weed up
wee-weed up's picture

But Obozo's MSM keeps saying the housing market is in recovery!

Mon, 07/14/2014 - 15:53 | 4956593 hedgeless_horseman
hedgeless_horseman's picture

 

 

There has never been a better time...

Mon, 07/14/2014 - 15:56 | 4956613 centerline
centerline's picture

... to sit one's overpriced home post-SHTF and realize that staying put means heat stroke, dehydration, etc.

Mon, 07/14/2014 - 16:12 | 4956680 Charles Wilson
Charles Wilson's picture

On the other hand, if you happen to have one of those Certificate of Participation Ameerican Citizen cards they'll be handing out soon, a free home in Arizona would look pretty good...

Mon, 07/14/2014 - 22:20 | 4957779 knukles
knukles's picture

So, HH, the camps look pretty good from the outside, no?

Mon, 07/14/2014 - 18:48 | 4957268 Squid Viscous
Squid Viscous's picture

prison planet...

Mon, 07/14/2014 - 16:02 | 4956651 Sudden Debt
Sudden Debt's picture

What I don't understand is why anybody would buy a piece of dessert sand with cardboard walls for a crazy price when you have to drive through the same dessert for hours throug worthless land...
Half of America is green and half is dust and people go live where the dust is... Go fish I guess...

Mon, 07/14/2014 - 16:12 | 4956682 I am Jobe
I am Jobe's picture

It's all about location and living in the burbs. The Amerikan way . Spend 1hr on the road one way communting and have a house you come to , pickup dinner thru MCD on way home. Ah the dreams.

Mon, 07/14/2014 - 16:45 | 4956809 Citxmech
Citxmech's picture

I don't understand it either.  I honestly can't believe that there was any "demand" in the 1st place.

Somebody who lives there will have to chime in on why.

Mon, 07/14/2014 - 17:32 | 4956996 seek
seek's picture

Freedom, low taxes, and Arizona is a big state. If you enjoy the outdoors you work during the week in Phoenix and take off for anywhere on the weekends.

I'm a 50yo native. It's a cultural wasteland, but it's our cultural wasteland, and since we're the last state in the continental US added to the union, some of the old west ways and indepedence still linger and that's appealing to a lot of us.

Mon, 07/14/2014 - 18:00 | 4957106 Professorlocknload
Professorlocknload's picture

And those 70 and 80 degree winter time temps are easy to live with, as well.

Though I'll admit, I still scamper off to the Pacific Northwest in late spring, when I see lizards carrying canteens.

Mon, 07/14/2014 - 18:57 | 4957274 Squid Viscous
Squid Viscous's picture

where do you "take off for" ... to roast in the desert somewhere? Vegas? Lake Mead to pretend to be a boater? oh wait you have the Grand Canyon, that would be fun for a day or two ... 

Mon, 07/14/2014 - 21:31 | 4957673 seek
seek's picture

Common misconception we're all desert. In the late spring you can go from water skiing to snow skiing with a two hour drive.

The northern half of AZ is a mix of forest and high desert, a lot of us head up to "the rim" in the summertime. 70 degrees and afternoon thunderstorms like clockwork.

In the wintertime the people on the rim head down to Phoenix to warm up.

As far as lake Mead -- there are many lakes. AZ has one of the highest per-capita boat ownership rates in the US because of that.

Mon, 07/14/2014 - 22:09 | 4957735 Squid Viscous
Squid Viscous's picture

ok ... whatever floats your boat ... beats the hell out of plains states and midwest, most of southeast, i guess,

I live in NJ, surf and fish and ski once in a while ,  just to sit by the ocean is therapy for me...

 

 

Mon, 07/14/2014 - 23:31 | 4957964 EHM
EHM's picture

You can go from cactus to pine trees in an hour and a half.

Tue, 07/15/2014 - 05:07 | 4958273 Where My Dawg At
Where My Dawg At's picture

Seek's got it right. The geographic diversity in Arizona is amazing. There's a 20 mile stretch of highway in southern AZ known as the Sky Island Highway that covers all sorts of various climates from desert to alpine in just a short 20 mile drive.

Summer storms are a sight to behold in the deserts and a quick 1.5 hour drive north yields substantially cooler temps in the summer. We can also go up there and ski in the winter. Hunting, fishing, hiking, biking, shooting and many other outdoor activities are easy due to the generally predictable weather. Also, we're only about a 6 hour drive from Vegas or San Diego. As a kid I used to go down to Rocky Point, Mexico but I don't think I'd do that anymore.

AZ also has no real threat of earthquakes, tornadoes (for the most part), hurricanes or anything other than dust storms, occaisionally harsh monsoons, occaisional blizzards in the north and that's about it other than the heat.

 

I'm a native, born to easterners that moved her close to 40 years ago. I spent my summers in Pt. Pleasant and Manasquan as my grandparents lived in Brielle. I loved the shore (and the pizza), I long for it, but I can't imagine ever living in New Jersey.

Mon, 07/14/2014 - 19:13 | 4957338 Citxmech
Citxmech's picture

Actually, in defense of AZ, during the time I've spent there - I really liked Flagstaff.  Kinda reminded me a bit of Tahoe without the Californians.  

I looked into Phoenix when the company I worked for at the time was going to start a new facility out there - but I just knew I would be miserable there (I am just not a desert creature, i guess). 

Mon, 07/14/2014 - 20:20 | 4957497 Freddie
Freddie's picture

Yeah McCain and Jeff Flake plus Jan Brewer engage in those old western ways like being Soros and Lester AIPAC Crown's little bitches.

Mon, 07/14/2014 - 17:11 | 4956912 NidStyles
NidStyles's picture

Ask the Baby Boomers they are the ones that played this market up. 

 

I live here because I have family here, and no other reason to be honest. 

Mon, 07/14/2014 - 16:13 | 4956689 Save_America1st
Save_America1st's picture

mmmmm...brown on brown with dirt and rock accents.  Home sweet home.  For the illegal invaders that's a freakin' paradise waiting to be overrun and taken over!

Mon, 07/14/2014 - 17:18 | 4956959 NidStyles
NidStyles's picture

RAWR!! YOU ARE DIFFERENT THAN ME, SO I HATE YOU!!! RAWR!! 

 

That is about the level of posting that I see coming from you. You're a fucking idiot. 

Mon, 07/14/2014 - 20:53 | 4957589 Save_America1st
Save_America1st's picture

rawr, little kitty...rawr.

;-)

Mon, 07/14/2014 - 19:06 | 4957314 Squid Viscous
Squid Viscous's picture

they look like good halfway houses before Folsom, Pelican Bay etc.

Mon, 07/14/2014 - 16:42 | 4956800 pashley1411
pashley1411's picture

I call that composition "21st century podfarm"; nice ring to it too.  

Dog is looking for a spot of grass to pee on, poor bastard.

Mon, 07/14/2014 - 16:49 | 4956823 duo
duo's picture

Mine's the tan stucco one

Tue, 07/15/2014 - 06:54 | 4958386 MrSteve
MrSteve's picture

Boy, did you get stucco!

Mon, 07/14/2014 - 17:09 | 4956905 homiegot
homiegot's picture

There's never been so much choice, so much variety...

 

We are very near the end.

Mon, 07/14/2014 - 17:29 | 4956990 Jumbotron
Jumbotron's picture

Little pink houses....for you and me.

Mon, 07/14/2014 - 22:13 | 4957221 Squid Viscous
Squid Viscous's picture

good one Jumbo, can't believe I just upvoted you...on second thought fuck you, ashkenazi pig

Mon, 07/14/2014 - 17:54 | 4957087 Yes_Questions
Yes_Questions's picture

 

 

chemtrails

 

 

Mon, 07/14/2014 - 22:27 | 4957796 knukles
knukles's picture

Of course, must aerial fluoridate the camp dwellers for compatibility's sake
Citizen Knuk137, time for you to go outside for your barium enema.

Mon, 07/14/2014 - 18:39 | 4957239 quasimodo
quasimodo's picture

Such fine and unique dwellings. Each one has a certain character all it's own.

Mon, 07/14/2014 - 20:46 | 4957572 Jerk_Store
Jerk_Store's picture

Must be more than a few oldtimers wandering around lost. Went out for a walk and couldn't find their way back home.

Mon, 07/14/2014 - 15:55 | 4956608 Bill of Rights
Bill of Rights's picture
Gold and Silver Price Manipulation Circumstantial Evidence of Gold and Silver Manipulation

http://smaulgld.com/gold-silver-price-manipulation

Mon, 07/14/2014 - 16:02 | 4956653 Pheonyte
Pheonyte's picture

Dude, PM manipulation was an open secret a few years ago, now it's just open.

Mon, 07/14/2014 - 15:56 | 4956616 Quinvarius
Quinvarius's picture

I think the market will start to crash tomorrow.

Mon, 07/14/2014 - 15:59 | 4956635 NOTaREALmerican
NOTaREALmerican's picture

Down 500 points or 50%?

Mon, 07/14/2014 - 18:39 | 4957232 Squid Viscous
Squid Viscous's picture

no a crash is defined now as a down 0.5% open, at which point you wait about 5 minutes then buy with both monkey fists ... then sit back and eat a banana

Mon, 07/14/2014 - 18:38 | 4957233 motorollin
motorollin's picture

A crash these days means only up .1%

Mon, 07/14/2014 - 16:00 | 4956640 Sudden Debt
Sudden Debt's picture

Better wait untill the summer is over.
I like it more when the market crashes and there are dark clouds, rain, wind and lightning. You know... The dramatic tough.

And september will be the month of mass layoffs in Europe, the year is fucked up and the costs of firing people can thus be put with the rest of the bad numbers to try to have a good year in 2015.

2015... This shit is really dragging on...

Mon, 07/14/2014 - 16:38 | 4956784 Quinvarius
Quinvarius's picture

I don't think the bankers care what the averages are at when there is money to be had easily kicking the shit out of them.  This market looks like the end of the tech market in 2000. If it is going to happen, they might as well make money doing God's work.

And whenever Goldman repeats themselves three times, it is like looking in the mirror and saying "candy man" three times.  You don't get any candy.

Mon, 07/14/2014 - 16:30 | 4956750 _ConanTheLibert...
_ConanTheLibertarian_'s picture

at 3pm

Mon, 07/14/2014 - 17:11 | 4956914 shadescale
shadescale's picture

Actually, I betting it will crash right after the US fall elections, when one set of corrupt government hacks (the Republicans) replaces another set (the Democrats). 

Mon, 07/14/2014 - 17:41 | 4957032 earnulf
earnulf's picture

When the SHTF, everyone will be pointing fingers, not realizing that out of the four fingers on each hand, three are pointing at the pointee.

Mon, 07/14/2014 - 15:59 | 4956634 NOTaREALmerican
NOTaREALmerican's picture

It was unusually hot in Phoenix.   The forcast calls for improved weather by end of Q3,  I'm sure things will pick up then.

Mon, 07/14/2014 - 16:01 | 4956641 greygoo
greygoo's picture

Fucking hellhole.

Mon, 07/14/2014 - 16:04 | 4956656 cityguyusa
cityguyusa's picture

Seems to me that this is exactly what would happen based on Fed policy.  Prices go up due to overprinting of money while people make less and are unable to afford new homes.

Mon, 07/14/2014 - 16:05 | 4956659 Save_America1st
Save_America1st's picture

Oh, don't you worry, Phoenix....there will be plenty of illegal invaders coming your way by the 10's of thousands very soon, if not already.  They won't work or purchase the homes, but chances are for the right votes, obama and the Hildabeast will give them all the free housing they want in your pretty city. 

How's the Mexican cartel, drug smuggling, kidnapping, and violent gang-related crime going there these days, ay? 

Hope and Change and Forward and all that good stuff should work out just fine. 

Mon, 07/14/2014 - 17:21 | 4956964 NidStyles
NidStyles's picture

Why is your bigotry tolerated but Francis is banned?

 

Why do I only see you posting that garbage everywhere? Why are you here again?

Mon, 07/14/2014 - 17:44 | 4957046 Dingleberry
Dingleberry's picture

Uh....truth perhaps?

Mon, 07/14/2014 - 18:36 | 4957224 Professorlocknload
Professorlocknload's picture

It's not bigotry,,,it's what makes America Great;

http://www.metrolyrics.com/what-makes-america-great-lyrics-firesign-thea...

Mon, 07/14/2014 - 16:06 | 4956663 Goldilocks
Goldilocks's picture

Cliff Clavin on Jeopardy
http://www.youtube.com/watch?v=botdmsQilnU (4:51)

Mon, 07/14/2014 - 16:08 | 4956672 Lewshine
Lewshine's picture

It's a good thing housing, consumers, retail sales, jobs (full time), geopolitical hot zones and Europe, China and Japan's flat-lining...Doesn't have anything to do with higher US stock value. Just ask anyone who owns US equities.

Mon, 07/14/2014 - 16:08 | 4956675 Darkdoc
Darkdoc's picture

What part of porous border is so hard to understand??

Mon, 07/14/2014 - 16:09 | 4956677 Duffy Duck
Duffy Duck's picture

the Breaking Bad effect?

NM, AZ - same shit....future northen province of mexico...

Mon, 07/14/2014 - 16:12 | 4956684 I am Jobe
I am Jobe's picture

TX will be in the same boat, lots of track homes

Mon, 07/14/2014 - 16:30 | 4956751 yrad
yrad's picture

As a 4th generation Texan, you have been downvoted...

Mon, 07/14/2014 - 17:01 | 4956866 Jugdish787
Jugdish787's picture

I know "texans" are a proud bunch, but come on!! Let's get with times here shall we? Sure there are a portion of "texans" who still have the old texas spirit but there are WAY, WAY too many vagina's who now inhabit the lone star state. Not to mention all the illegals flooding the border. Someone told me the other day that texas will be the last hold out, etc, etc...blah blah blah. Show me "texans" still have the spirit, they all think they have, otherwise sit down and stfu about texas...Mexican territory is going to expand up through the texas asshole headed north and west.

Mon, 07/14/2014 - 21:21 | 4957647 toady
toady's picture

Damn pillow biters.

Mon, 07/14/2014 - 22:57 | 4957871 Agstacker
Agstacker's picture

I lived in Anchorage AK growing up and remember reading something written in a men's room above the urinal...

 

"Alaskans aren't worthy to lick the hemmoroids of a Texan"

 

 

Mon, 07/14/2014 - 23:37 | 4957978 EHM
EHM's picture

I know right? Who is going to stop the brown invasion? Don't they understand that white people were here first. Oh wait..

Mon, 07/14/2014 - 19:12 | 4957335 Freddie
Freddie's picture

Yeah what is Rick Perry doing about the invasion?  The same as Jan Brewer and Susan Marinez - nothing.

Shame Rick Perry was not at the Alamo.  Jim Bowie would have shot him.  Texans talk a big game but they are so into football and they deny the invasion.  They say shit like - our Mexicans are not like California's mexicans.  

Mon, 07/14/2014 - 22:28 | 4957785 August
August's picture

>>>Yeah what is Rick Perry doing about the invasion?  The same as Jan Brewer and Susan Marinez - nothing.

In six months' time USA as a whole will likely have acquiesced to its open and irreversible transformation into an Anglo-Latin condominium; such a transformation is not in itself "bad", but it does represent a very significant historical shift.  The biggest losers are African-Americans and, of course, any of the former middle class who still pay taxes.

Mon, 07/14/2014 - 17:50 | 4957066 GFKjunior
GFKjunior's picture

Wrong. Demand for housing in every major city is off the charts. Every city, but especially the texas triangle, is gowing through an economic/population boom.

Mon, 07/14/2014 - 16:13 | 4956690 TheFreeLance
TheFreeLance's picture

See, the same thing is happening with "retirement" prop in the Blue Ridge. Been watching it very closely last 4-5 yrs and people are officially running for the exits this summer, cuz come fall that means another year winterization costs and property tax bills. I have my eye on a couple props on 3-4 acres that should be relatively zombie/food riot proof. Might head out about Labor Day with $50K in cash and see what shakes loose.

Mon, 07/14/2014 - 16:27 | 4956742 Frank N. Beans
Frank N. Beans's picture

good luck, make sure it's got a still

Mon, 07/14/2014 - 16:33 | 4956760 TheFreeLance
TheFreeLance's picture

If it don't, it will.

Mon, 07/14/2014 - 16:19 | 4956712 Seasmoke
Seasmoke's picture

After the SW collapses, head on up to the NE , where here in NJ , no shit I see 5 house for sale signs, go up every week, just in one street thru town !!!!

Mon, 07/14/2014 - 16:32 | 4956757 TheFreeLance
TheFreeLance's picture

Here's the problem though: If Quebec ever gets its shit together -- yeah, I know -- it could be the hydro power House of Saud in NA. Brown-outs and blackout riots could be a regular part of life in the NE, which simply does not have enough power capacity to meet demand. Fine if you are living in the woods of Maine with one of those old ammonia absorption refrigerators, but if you are even in a town of 30K and lights go out for a week every month -- interesting times.

Mon, 07/14/2014 - 21:18 | 4957640 oddjob
oddjob's picture

Quebec has until 2041 when the Churchill Falls contract with Newfoudland expires. After that, the Newfies will make them pay thru the nose.

Mon, 07/14/2014 - 16:20 | 4956715 BlindMonkey
BlindMonkey's picture

"..the market remains unbalanced.."

 

The money quote.

Mon, 07/14/2014 - 16:35 | 4956770 general ripper
general ripper's picture

New refugees from Southern Hemisphere will pick up the slack in low end under 150K with assist from US Govt. Drug cartel board room members will fill out the high end (in cash).

Middle ground reserved for naive seniors who insist on year round golf and occasional bingo. State will be blue shortly.

No worries!

Mon, 07/14/2014 - 19:32 | 4957379 lakecity55
lakecity55's picture

!Azul y Mejicano, amigo! !Solamente!

Mon, 07/14/2014 - 16:36 | 4956773 Dingleberry
Dingleberry's picture

Maybe the muppets finally realized they actually need water to live there?

Or are they afraid of the newly-minted democrats streaming across the....ahem...."border"?.

Mon, 07/14/2014 - 16:38 | 4956781 pashley1411
pashley1411's picture

Hayek would say that as the government moves into a market, the clearing price gets more or more set by political considerations, less and less by supply and demand.

Until the government is on both side of the transaction.   Which is just fine by them.    Until they wonder where the tax base went.

One of my closer friends is a newbie real estate agent, and she has to pull couples out of their parents bases to start them out on the American dream.

 

Mon, 07/14/2014 - 17:05 | 4956881 Uncle Remus
Uncle Remus's picture

I spent over 30 years in AZ, most of it in the Valley. Bailed almost 15 years ago - primarily due to crime and the influx of illegals. Cost of living is high, commuting is a bitch and frankly, I watched it turn in to LA east from the 60's on as asshole after asshole moved in and brought their social and political baggage along with their fucking pollen laden thirsty ass plants from home. It was a truly sad transformation.

I worked a bit on the Central Arizona Project as it was built out past the East Valley and knew then that it wasn't going to end well in Phoenix.

[I had nothing to do with Janet Napolitano, but I have to bear a vote worth of responsibility for that traitorous fucknut Juan McCain.]

 

Mon, 07/14/2014 - 21:56 | 4957722 One of We
One of We's picture

A beaner-ridden smog hole without benefit of a nearby ocean?  No thanks!  And fuck you for your Mccain vote!

P.S. Fuck me for my Mccain vote in '08 which was really a Palin anti-Obama vote before I realized I didn't really have a choice.....

Tue, 07/15/2014 - 06:11 | 4958336 Uncle Remus
Uncle Remus's picture

A righteous "fuck you" for McCain vote acknowledged.

Tue, 07/15/2014 - 05:12 | 4958275 Where My Dawg At
Where My Dawg At's picture

It's really a toss up as to who has ruined this state the most; illegals from the south or the legals from Califonia and every back east.

Mon, 07/14/2014 - 17:06 | 4956885 virgilcaine
virgilcaine's picture

The time to live anywhere decent in 'Merika' was in the 1950's-60's.. its been over a loong time.

Mon, 07/14/2014 - 17:06 | 4956889 Hulk
Hulk's picture

The 3 gigawatt nuclear power plant, palo verde (wintersburg, az), uses phoenix waste water (piped 50 miles) for cooling.

We does lives in interesting times...

Mon, 07/14/2014 - 17:09 | 4956904 Uncle Remus
Uncle Remus's picture

So, dirty dirty bomb then.

Used drive by it daily while under construction, especially when headed out for work at the Goldwater Range the AF stick jockeys practice on - well used to anyway.

Mon, 07/14/2014 - 18:40 | 4957242 Squid Viscous
Squid Viscous's picture

new definition for Same Shit, Different Day?

Mon, 07/14/2014 - 19:31 | 4957378 Ignorance is bliss
Ignorance is bliss's picture

That's some hot shit.

Mon, 07/14/2014 - 17:14 | 4956932 shadescale
shadescale's picture

"unprecedented", "unexpectedly", "polar vortex": you think that the media could come up with some more creative ways to spin the bad....

Mon, 07/14/2014 - 17:15 | 4956937 TheEndIsNear
TheEndIsNear's picture

"This [chronic housing] shortage has not gone away. It has just been masked by the unusually low demand..."

A chronic housing shortage with low demand?  Then the supply must be extraordinarily low.

Mon, 07/14/2014 - 17:15 | 4956938 TheEndIsNear
TheEndIsNear's picture

"This [chronic housing] shortage has not gone away. It has just been masked by the unusually low demand..."

A chronic housing shortage with low demand?  Then the supply must be extraordinarily low.

Mon, 07/14/2014 - 17:17 | 4956947 seek
seek's picture

Investors drove prices up to crazy levels on the low end, and now both new investors and low-end buyers are bailing out.

It's truly insane -- in the core markets in the central Phoenix area, things are priced at $250/sq ft for a 1950s era ranch house (so $400K for a 70 year old 1,600 sq ft tract home.) What's interesting is that established outlying areas (not the new stuff in Gilbert/Mesa/AJ, but old stuff like north scottsdale, Carefree, etc) is actually going for less, which is very unusual. Honestly I don't ever remember a time where these areas were lower relative to central Phoenix -- I'm seeing equivalent houses to central Phoenix on 2.5 acres selling for $100K less.

Anyway, I suspect Phoenix is played out -- it was virtually all investor demand, and while there's a lot of high-end new construction, that will implode with the slightest sniffle from the stock market.

Mon, 07/14/2014 - 22:24 | 4957789 Squid Viscous
Squid Viscous's picture

remind me again, why the fuck would anyone live there?

Tue, 07/15/2014 - 00:33 | 4958062 MrSteve
MrSteve's picture

Like Casablanca, they go there for the water!

Mon, 07/14/2014 - 17:34 | 4956948 seek
seek's picture

.

Mon, 07/14/2014 - 17:34 | 4957005 homiegot
homiegot's picture

Couple this just over a half century left of oil and you've got a winning combination.

Mon, 07/14/2014 - 17:35 | 4957006 DOT
DOT's picture

I will be going down to Phoenix at the end of this week. Glad to see that the optimists have fled.

 

Mon, 07/14/2014 - 17:42 | 4957033 auntiesocial
auntiesocial's picture

rental / investment - yes.

live in Phoenix? hell but fuck no! 

did it and couldn't wait to peace out. 

Mon, 07/14/2014 - 17:48 | 4957061 PoliticalRefuge...
PoliticalRefugeefromCalif.'s picture

Well it seems taking turns kicking Arizona in the crotch is a lot of fun as well as good exercise after the weekend, but the story's the same in real estate except for the DC area and isolated pockets everywhere across the US and that is the real theme of the article.

Soon reality will kick in and prices on existing homes will spiral in to an empty buying market for the same reason all across the nation.... no decent jobs growth for ten years.

  ..and that herd of buffalo ain't coming back ever- what is this- the fourth or fifth summer of recovery?

I like it here as well as anywhere else I have lived but have long since realized that the security of home ownership anywhere is a concept that's time has come and gone in America, it was a mirage anyway.

When this thing falls apart would you rather be in Arizona, Deathgrip Ohio, L.A. or New Jersey? after all Arizona has a population that is pretty well armed, few blacks and not saddled with whole cities of marauding feral urban opportunists.

I admit water could be a problem but it's gonna be a problem in New Jersey as well- sans the added excitement inner city terrorists will bring.

Mon, 07/14/2014 - 18:08 | 4957130 Uncle Remus
Uncle Remus's picture

.

but the story's the same in real estate except for the DC area and isolated pockets everywhere across the US and that is the real theme of the article

Bullshit. Phoenix is a place you most certainly don't want to be, ESPECIALLY when the shit goes full Monty. And the article was very specific to AZ and Phoenix in particular. Wassamatta, you on the hook?

I admit water could be a problem

What. The. Fuck. Could be? More like it has been, since before I left 15 years ago.

Wait, did you vote for Obama?

Mon, 07/14/2014 - 18:48 | 4957269 PoliticalRefuge...
PoliticalRefugeefromCalif.'s picture

What does which (fill in the blank) criminal did I vote for have to do with the housing market falling out America's ass even in an election year with near all time low mortgage rates?

No.. however I notice those who accuse others with no clue of how they think or vote or even if they vote at all are the first in line to bring out the toss-aways like... "if voting mattered they wouldn't let you" or something else equally idiotic; In my way of thinking, it's voting that got us to this point, so how is voting going to get us out of here?

This article is specific to Phoenix but if you had a clue you might realize that what is happening here is merely the first indicator of what is in store everywhere mortgages are required to consummate real estate deals.

Did you notice Citi and WF laying off nearly their entire mortgage service force starting last Autumn?- if so, what was that all about?

..or did that just fly right over your head?- I suggest you try to concentrate on the point of the topic which evidently you missed before you run your mouth.

Tue, 07/15/2014 - 06:06 | 4958329 Uncle Remus
Uncle Remus's picture

.

What does which (fill in the blank) criminal did I vote for

It was an insult.

 

This article is specific to Phoenix

Which was the point of my comment - so glad you picked up on that. Since the article was about Phoenix and I lived there for three decades, experiencing the ups and downs of real estate market and construction in general, I figured I had a leg to stand on.

 

Mon, 07/14/2014 - 20:41 | 4957560 Freddie
Freddie's picture

AZ at least has Sheriff Joe Arapio but the rest of the state and people are shit.  They voted to keep McCCain.  Retards. Las Vegas and Phoenix are pits.  Scottsdale is slightly better.  Albuqueque has a much better climate than both of those hell holes.

Mon, 07/14/2014 - 21:38 | 4957687 jldpc
jldpc's picture

Only Sherrif Joe keeps the Mexicans in check.

Tue, 07/15/2014 - 06:16 | 4958332 Uncle Remus
Uncle Remus's picture

Scottsdale - city of more money than sense.

EDIT: Sheriff Joe - tent jails, women chain gangs, pink boxers for inmates of any sex, bologna sandwiches - what's not to like?

Mon, 07/14/2014 - 18:08 | 4957126 Uncle Remus
Uncle Remus's picture

Dup

 

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