Paul Slaybaugh, Scottsdale AZ Real Estate

Still kinda sucks. Check back in a week.

As Phoenix area homebuyers look to cash in the winning lottery tickets in their hot little hands, it is worth noting that there is such a thing as biting off more than you can chew. While market analysts and laypersons alike point to avarice as the primary machination that brought our economy to its current state, buyers need to be watchful that they don't get clobbered by the same pendulum that threatens to come careening back their direction. As our populace accumulated far more Real property than it could actually afford at the height of the market, buyers today encounter a few substantial risks of their own. First and foremost is the uncertainty of the status of the product they wish to buy at a deep discount.

This past fall, I was looking at a really sharp mid-century modern condo conversion project in downtown Phoenix. Prices had come down considerably from their start point, and there were only a couple of occupied units amongst the 40 or so the development had in total. We knew the opportunity existed to command a terrific bargain. As a matter of fact, my jaw hit the floor when the developer later called me directly with an incredible offer on the unit my client found most appealing. She loved the unit, I loved the price. We were salivating.

And we passed.

I smelled trouble. If the builder was willing to basically give the unit away to my client, what would prevent him from drastically cutting prices even further for future buyers? The complex simply had "declining values" written all over it. More to the point, however, I was concerned with the overall stability of the development. I didn't want my client to move into a ghost town regardless of the price.

As it happens, our fears were well founded. The complex, aside from the couple of units that sold a year ago, is now in the hands of the bank. Lost to foreclosure, lord knows what will happen to the common grounds, let alone the individual units. The poor occupants who jumped too eagerly must now worry that they will soon have squatters for neighbors and that their values and personal enjoyment of their homes will be further decimated. As it stands, the prices on the units are now about 50% lower than the smoking deal we were offered back in the fall and declining as I type this.

I have seen too many builders pull out of developments, leaving the inhabitants with vacant lots and plummeting values for neighbors. I'm not talking about mom & pop builders, either. We're seeing formerly vibrant national builders circle the drain.

The long and the short of it is that you must protect yourself in this market by keeping an eye on more than the bottom line. There are tremendous opportunities out there, but you must be dilligent in assessing the full situation. Be aware of the risks you run when pushing for that little extra something in terms of price. It's not always just about finding the cheapest thing that you can.

Even in this market, if it sounds too good to be true, it most likely is.

There are resources at a buyer's disposal that can help you ascertain the stability of a builder or project. I implore you to use them. A good place to start is the Arizona Department of Real Estate, which features a list of home builders that are in financial trouble, tagged with mechanic liens or currently undergoing bankruptcy processes.

By all means, use the current market to your advantage in commanding a great deal, just make sure that you are getting what you think you are stealing.

<><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><>

To start your Scottsdale, Phoenix or Paradise Valley AZ home search, please visit our website today.

Ray & Paul Slaybaugh - Serving Scottsdale Since 1974

(And Not Above Exploiting the Cuteness of Small Children for Your Business)

(480) 948-9450

Frankie was eating an ice cream cone when the world ended at precisely 3:14 PM PST.

Perched upon the slightly too tall swivel stool that prevented his size four shoes from reaching the metal footrest, he raced the sun that beat down on his prize through the pane glass window for the last dripping remnants of rocky road. His four year old mind was not equipped to appreciate the terrible irony of his selection.

The van was somewhere beyond the wall of light, but the glare prevented him from seeing it. He wanted to move to a different seat, but his mother had told him to stay put while she used the restroom. Already mad at him for not listening to her on the drive over, she would take his ice cream away and put him in timeout if he didn’t do as she said.

“I behave, Momma,” he squealed as he spun to meet the sounds of the familiar footfalls. His eyes grew wide as she sat down with her own chocolate cone that contrasted wonderfully with the vanilla scented perfume she always wore.

“I have some! I have some!”

“No way, Jose,” she offered in mock protest through a coy smile. “This is Mommy’s. You already had yours.”

Looking down at the sad, melted cone in his hand, he was cut off before his objection could even be vocalized.

“Tell you what,” she compromised, “I’ll let you have a bite of Mommy’s if you promise to be good on the way home. Okay?”

“Okay, Momma!”

She handed Frankie the cone as she guided him to a seat away from the window. She’d initially selected it to keep a watchful eye on the parking lot, but the western exposure ensured the futility of that plan. The pair took a seat at a table in the middle of the Baskin Robbins, and she managed to wrestle her ice cream back with relative ease.

Frankie regaled her with tales of his day at preschool while she savored her indulgence. Catching only one or two out of every four or five words, she had long since learned that his sentences didn’t necessarily constitute linear thought. He tended to go the stream of consciousness route.

More like a flash flood, she thought.

If he were to be believed, Miss Heather had apparently been a monkey and chased a tiger up to the sky in a choo-choo train made of feathers. That’s what she heard, at least. Dropping in a well timed “really” or “wow” where appropriate, she struggled to feign interest. In truth, she was so consumed with her mental shopping list for dinner (chicken or salmon?) and the myriad chores she needed to finish before her husband returned home from his business trip that she wouldn’t have blinked if Frankie told her that his day had been spent running with scissors and sticking paperclips into the outlets. The travel associated with John’s new position made things much more difficult, but she couldn’t really complain. They were fortunate that he had been able to find work again so quickly after the layoff. The same couldn’t be said of most of his former colleagues.

“Momma?”

“Oh, yes, sweetie? Ready to go?”

She must have drifted off for a moment.

“I ready.”

“Okay, let’s get some for your sister for when she wakes up and then we can go.”

Stepping out into the brutal, shimmering heat of the concrete desert, she made her way to the tan Honda Odyssey with a paper bag in one hand and Frankie’s tiny hand in the other. He stubbornly clung to his barren cone, probing its recesses with his tongue for one last sticky drop as he was dragged along behind her.

When they reached the minivan, it didn’t immediately register that anything was wrong. She saw Darcy sleeping peacefully in her car seat when she looked through the window. The smile that spread across her face froze instantly, however, when she realized the engine wasn’t running.

As often happened, her baby daughter fell asleep on the way to pick Frankie up from school. Ordinarily, they would go straight home, but she’d decided to stop for ice cream today on nothing more than a whim. It was hot, and she’d felt guilty about how short tempered she’d been with the kids over the past few days.

The keys were still in the ignition where she’d left them, and the car had been purposefully left running. Everyone knows that you don’t leave a child in a vehicle without the A/C running in the summer.

“Oh my God!”

Not sure when the engine conked out, but knowing they had been inside for nearly twenty minutes, she frantically yanked at the handle of the back seat. It wouldn’t budge. Remembering that she had locked and armed the car by removing the alarm fob from the key ring, she fished in her purse until she found it. Pressing it twice to unlock all doors, she tore open the door and reached for her baby.

“Darcy? Darcy, wake up, honey! It’s Momma, wake up, Darcy!”

“What’s wrong, Momma,” Frankie demanded.

She ignored him as well as the small crowd that was beginning to gather.

“Darcy! Darcy, wake up!”

........................................................................................................................................

Every summer, children drown in Phoenix area pools and perish in parked cars. It’s important to remember that these tragedies befall not only the criminally negligent, but good people who simply lose sight of the dangers for an instant. Parents are overworked, tired, stressed and more preoccupied than ever. This leaves us all more susceptible to poor decision making. Let’s not allow the hardships that have befallen many of us to be the precursor to greater tragedy. If I have learned anything over the past several years, it is that parenting is the one occupation that doesn’t allow you to let your guard down. Not for a second.

Let’s all remember our true priorities this summer and not permit one single child to perish from preventable causes. Watch your kids around water and never, ever leave them alone in the car.

We can do this, Phoenix. Not one child.

When I first got into this business a decade ago, it didn't take long to encounter one of the favored pastimes of consumers and professionals alike: Reveling in prices that once were.

Whether it was the colleague pointing out a development where he lamented not purchasing five units back when they could be had for $75,000 apiece, or the investor who regretted selling that rental property years before now that it was worth three times as much, the underlying wish was to turn back the clock to grab as much Real Estate as humanly possible at the never to be seen again values.

Of course, the downside to the markets that spawned the low price housing in Scottsdale in years past was diminished purchasing power due to elevated interest rates, and the speculative nature of our community. Always a winter haven for the well-heeled, we were still very much a community in progress. All the signs pointed to a city on the upswing, but with abundant raw land and subdivisions still in their infancies several decades ago, there was still a bit of a gambling aspect to home ownership in the desert.

Flash forward to today, and those who rolled the dice on our bustling town hit paydirt, while those who were late to the speculative party (2005-2006) were the unfortunate ones who wound up with snake eyes.

The subsequent erosion of values has hurt many Valley homeowners, but it has also spawned an opportunity that many previously thought had been lost forever. Affordable housing has returned to Scottsdale.

• In all of 2006, there were 39 total sales of single-family homes listed at or below $250,000 in Scottsdale.
• In 2007, that number rose slightly to 48.
• 2008 saw that figure rise dramatically to 247.

*As of today (1/25/09), there are currently 159 Active Listings for single-family homes under $250,000!

Okay, McFly, you've climbed behind the wheel of your DeLorean, coaxed the odometer to precisely 88 miles per hour, and now find yourself back in 2003-2004. Of course, it is a parallel universe in which pricing reflects the period immediately before the boom while interest rates are lower, competition for properties is diminished due to tightened financing guidelines and the available home inventory from which to choose is infinitely greater. Our little town is all grown up now, so who knows when the opportunity for the scaled back pricing in a destination city that is presented today will ever return?

Time to fix some of those investment laments or find that entry-level Scottsdale home that is back within reach.

*Facts and Figures Gleened from ARMLS*

_________________________________________________________________________________________________________

For a Complete Guide to Affordable Housing in Scottsdale AZ

Paul Slaybaugh, Realty Executives

(480) 948-9450

Receive listing alerts, the Scottsdale Foreclosure Value of the Week, Community Spotlights and more by subscribing today! Click the button above to receive email alerts for new posts!

If you are like many potential home sellers I have spoken with over the past several months, you are leery of putting your home on the open market.  The crush of competition, the dirth of qualified buyers ... the constant state of panic that your home won't be in absolutely show ready condition when a buyer finally does show up after weeks of inactivity.  Perhaps you would like to move, but simply do not want the hassle associated with listing and marketing a home. 

Basically, you would sell if a buyer fell from the sky (or internet), but don't want to be bothered otherwise.

With you in mind, I am posting the needs of a few current buyers.  We've seen the current inventory for their criteria, but have yet to be blown away.  That's where you come in.

Buyer needs for the weekend of 1/16/09

1.  Buyer number one is looking for 5 bedrooms plus a den, 4000+ square feet, newer construction, on an acre in the Chaparral High School district.  The Town of Paradise Valley or along the Orangetree Golf Course are preferable, but we are open to other possibilities.  High ceilings are a must.  Will look up to $1.5 million for the right fit.  Must be an absolute show-stopper at that price point.  Will consider fixer uppers with the right bones in the $700,000 - $1,000,000 range.                                                                         

                                                                                                 *We were thinking something like this*

3.  Buyer number three is looking for a single-family home between 2500-3000 square feet in the Desert Shadows Junior High School District.  We will consider prices up to $400,000.  The critical factor is an owner willing to take back some paper.  If you are willing to hold a note in order to sell your home to a buyer with 20% to put down, I want to talk to you.                                                                 

*This should do fine*

4.  Buyer number four wants your semi-dilapidated McCormick Ranch home.  Currently looking at bank-owned properties, estate held properties and the line, we see no need to wait for the bank to destroy your credit through foreclosure before deciding whether or not a sale can be mutually beneficial.  If you have a home that is in either physical or financial trouble in the McCormick Ranch area, my investors are interested.  While 1800+ square feet, 3+ bedrooms and a pool are preferences, we will consider anything that has adequate upside potential.  Not looking to steal anyone's home, but the math must be advantageous to make it a possibility for these buyers.                                                                                 

*In the right hands ...*

I am always interested in properties in Hayden Estates as well.

If you are a local Scottsdale / Paradise Valley Real Estate agent with an upcoming listing that matches any of these criterions, give me a call.  We might be able to get that baby sold before you spend dime or calorie one on marketing it.

________________________________________________________________________________________________________

Paul Slaybaugh

Realty Executives

Scottsdale, Phoenix and Paradise Valley Real Estate

(480) 948-9450

Subscribe to Paul's Scottsdale AZ Real Estate Chronicles by Email