Stuck in Phoenix, the Epicenter of Housing Crisis

[JonLP24]

Commentary: It may take years for housing to bloom again in desert

n metropolitan Phoenix, two-thirds of all residential mortgages are underwater. Of these, some 200,000 are 50% larger than the current market value of the properties. Many homeowners have come to doubt whether they'll ever retrieve their lost equity.

In this city of 4 million, the 14th largest in the United States, the median home price is down 53% since the bubble peaked in 2006 to just over $120,000. Only smaller cities such as Las Vegas and Orlando have witnessed equally catastrophic drops.

Paul Hickman, the head of the Arizona Bankers Association, says for Arizona the current recession is worse than the Great Depression of the 1930s. "Then," he told Cronkite News of Arizona State University, "our economy was young and we were just barely a state." Now, he says, Arizona is suffering because it became excessively dependent on a "one-dimensional housing economy."

Phoenix is no stranger to booms and busts. Home prices here fell in the late 1980s after the savings-and-loan debacle brought down several local developers, including the notorious Charles Keating of Keating Five fame. Now 88, Keating lives quietly in Phoenix, having served a 4½-year prison term for fraud after his Lincoln Savings and Loan collapsed in 1989.

http://finance.yahoo.com/real-estate/article/113212/phoenix-epicenter-housing-crisis-marketwatch?mod=realestate-sell

[OffWithTheirHeads]

1. Wow! I think I will seriously start looking to buy a home in Tucson.

I really, at this stage of my life, don't care if it goes up or down. I just want a roof over my head that I can call mine and a fixed payment that I can comfortably afford. Sounds like the time may be now.

[dixiegrrrrl]

3. Seriously, you want to look at all the factors in buying at such a "bargain" price.

Will the infrastructure be there to provide what you need?(fire, water, power)?
What about stores and schools? Will they be available in areas of suddenly empty homes?
( Detroit is effectively shutting down about 1/3 of city, no services, to save money)

Will you be buying a house in a development that is surrounded by deserted houses?

Here, in my town, one business closed down and the water dept. raised OUR water rates to make up for the "shortfall" of the monthly water bill of the closed business!

In our town, they are delaying re-paving "out of the way" roads.
It will not take too many months before those roads crumble, in our climate.

We made a decision when we bought to settle in close to town, and now I am glad we did, as the chances of services being cut are much less.

[mh74562]

4. +1

[Bryan Buchan]

2. I am one of them....

....mortgage note for 140,000 property currently valued at 40,000. Seriously. The only thing saving my ass right now is the rental market is still solid so I can rent the place (at a loss) and keep things a float...fucking sucks!