In the News Friday March 31st 2006

Waterfront homes raise selling price in desert, from The Arizona Republic Ahwatukee, reports that lakefront houses in the Southeast Valley are so popular that they can cost $100,000 more than comparable homes. "It's considered a highly desireable amenity. There was a period of time where every community that came on line included lakes," said local housing analyst RL Brown. Jack Lavelle with the Arizona Department of Water Resources said that although some people disagree, the lakes do provide some important functions. They gather rainwater, prevent flooding and enable reclaimed wastewater to be used to irrigate golf courses and common area landscaping.

Waterfront homes raise selling price in desert
http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/community/ahwatukee/articles/0331ev-realestate0331Z14.html



Don't fret drop in new-home permits, from the Arizona Republic West Valley, reports that the number of new home permits in the Northwest Valley and Southwest Valley fell from 2,106 to 1,495 in February. But market experts say this is just the market getting back to normal after last year's frenzied market. "The drop in permits is merely a blip on the radar," said Steven Kraut of Premier Properties. "The market is certainly not tanking; the builders were just overspeculative in the number of homes they produced." Since the housing market is largely driven by population and job growth, the Phoenix metro area will continue to thrive. This trend is especially true in the West Valley. With April around the corner, the market will stabilize even more, said Tom Traw with Traw & Associates.

Don't fret drop in new-home permits
http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/community/glendale/articles/0331gl-newsales31Z18.html



Safari Drive rising at old hotel site, from the Arizona Republic Scottsdale, reports that the five-story Safari Drive project, at the site of the former Safari Resort, opens for sales today. The Safari Drive project will include more than 200 residences in eight buildings, priced from $600,000 to $2.2 million. Vanguard City Home and Wolff Co. have designed an urban neighborhood with modern architecture, high ceilings, lots of glass, large decks and live/work lofts. The Safari Drive project is located just northeast of Scottsdale Road and Camelback, near Scottsdale Fashion Square and the Scottsdale Waterfront.
Contact us today for your private appointment to view this great new project.
Location! Location! Location!

Maricopa Millionaires! Is it a Buyer's Market?

Maricopa County movin' on up millionaire list, from the Arizona Republic, reports that Maricopa County ranks fourth in the United States in the number of millionaire households. It counts 106,210, or roughly 8.2 percent of all households, as having $1 million-plus in net worth. In 2000, Maricopa County ranked sixth. The information is from a report prepared by TNS Financial Services, a British market research firm. Los Angeles County took the top spot with 262,800 millionaire households, followed by Cook County in Illinois with 167,873 households. "You're a large county to begin with, and I would imagine that a lot of people retire to places in Arizona, particularly the Phoenix/Scottsdale area because the cost of living there is a little more favorable than a place like San Francisco," said Jeanette Luhr, manager of the study.

Maricopa County movin' on up millionaire list
http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/arizonarepublic/news/articles/0330millionaires0330.html


Phoenix a buyers' market, from the Arizona Republic, reports that homebuilders are wheeling and dealing as a result of stagnant new-home sales, offering all sorts of incentives such as free cars, thousands of dollars worth of incentives, and other freebies. "This is proof that the market has turned from a sellers' market to a buyers' market," said RL Brown, publisher of the Phoenix Housing Market Letter. In February, Scott Communities began offering a Honda Civic, Honda Element or $15,000 off the base price of a home. Other builders are offering huge incentives on "spec" homes, which have increased in numbers as buyers back out of contracts, many because they can't sell their existing home. Even with incentives, consumers are being very cautious, said Margie O'Campo de Castillo, a broker/owner of Arizona Dream Realty. "The incentives help, but I don't see people jumping up and saying, 'Let's go buy'. Right now. there's a lot of gun-shy buyers," she added.

THE INFILL WAVE AND NEW HOME BUILDERS UPDATE FEB 2006

Developers, politicians clamor to jump on infill wave, from the Phoenix Business Journal, reports that infill development seems to be on the minds of everyone these days, from Phoenix Mayor Phil Gordon to major homebuilders. The reasons for the increased demand for infill projects are rising land prices and development on the outer fringe of the Valley that have caused homebuilders to look for alternatives closer into the city core. The article notes several infill projects already in the works, such as Beazer Homes 20 unit housing project at 24th Street and Broadway, Trend Homes development of 750-homes at 24th Street and Roeser Road, and Lauth Property Groups Washington Airport Center, a master-planned business park on the site of a former mobile home park.

http://phoenix.bizjournals.com/phoenix/stories/2006/03/27/focus4.html?t=printable

New home sales plummeted in Feb., from the Arizona Republic, reports that national new-home sales took their worst drop in nearly a decade in February, and early indications are that it wasn't a good month for builders in metro Phoenix. New single-family home sales fell 10.5 percent in February. In the Valley, new-home numbers will be released this week. "Looking at the preliminary numbers, obviously February was a disappointment compared to last year and year-to-date," said RL Brown, publisher of the Phoenix Housing Market Letter, Builders are requesting fewer permits because they are trying to clear inventories or spec homes on which buyers didn't close, Brown said. "The bottom line is it is a market transition now," Brown said. The slowdown has put downward pressure on prices. Economist still believe that housing is likely to see a moderate slowdown this year rather than anything as severe as the bursting of a speculative bubble.

http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/arizonarepublic/business/articles/0325homes0325.html

Phoenix Communities a master-planning hotbed!

A master-planning hotbed, from the Arizona Republic, reports that five Valley master-planned communities are among the country's best sellers, according to a report released by Robert Charles Lesser & Co, LLC. Four of the developments are located in the fast-growing West Valley, where large tracts of developable land are making way for amenity-rich neighborhoods. The five communities are:
No. 7, Anthem, Northwest Valley
No. 8, Johnson Ranch, Southeast Valley
No. 11, Sierra Montana, Surprise
No. 12, Surprise Farms, Surprise
No. 13, Vistancia, North Peoria.
It comes as no surprise that the Valley has more developments on the list than any other market, said Curt Smith, chief operating officer for Scottsdale-based Sunbelt Holdings, which jointly developed three of the communities. Many of these new homes are going up in the West Valley. "A few years ago, this area had 30 percent of the market, and now it's pushing 70 percent," Smith said.

CONTACT OUR BUYER'S SPECIALISTS TODAY TO VIEW ANY OF THESE GREAT COMMUNITIES. WE WILL PERSONALLY SET UP A PRIVATE TOUR AND PROVIDE YOU WITH ALL OF THE VALUABLE INFORMATION YOU WILL NEED TO MAKE AN EDUCATED PURCHASE.....AT NO COST TO YOU.....THE BUILDER PAYS OUR FEE!
YOU CAN CONTACT ONE OF OUR AREA SPECIALISTS AT WWW.MEETUSATTHEMALL.COM


A master-planning hotbed
http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/community/westvalley/articles/0324gl-master24Z1.html

Compare January 2006 to January 2005

The following is a list of home resales and prices recorded within some of the largest cities within Maricopa County, comparing January 2006 with January 2005:
The Phoenix resale home market decreased from 2,685 sales to 1,635 sales, while the median sales price increased to $207,000 from $154,000.
Scottsdale's resale home market declined from 785 to 400 recorded sales, as the median sales price rose from $458,690 to $600,000.
Resales in Mesa declined from 1,060 to 615 sales, while the median price increased from $172,900 to $240,000.
Glendale decreased from 640 to 410 sales, but the median sales price increased from $171,450 to $238,500.
The Sun City resale market fell from 160 to 100 sales, but the median sales price increased to $212,000 from $159,000. And resale activity in Sun City West also slowed from 95 to 40 sales, but the median sales price increased from $179,900 to $243,500.
The resale market in Gilbert fell from 565 to 310 sales, but the median sales price increased from $244,000 to $337,250.
Chandler's resale market slowed from 625 to 330 recorded sales, while the median sales price increased from $219,000 to $305,000.
Tempe's resales decreased from 195 a year ago to 140 sales, with the median sales price increasing to $269,900 from $193,500.
Avondale fell from 220 to 150 sales with the median price moving from $188,140 to $258,000.
El Mirage resales decreased from 150 to 70, while the median home price went from $150,410 to $224,000.
Goodyear's resale home market fell from 195 to 100 sales, while the median price increased from $204,900 to $275,000.
Surprise decreased from 370 sales to 165, as the median home price rose from $195,000 to $249,000.
The highest median sales price was in Paradise Valley at $1,507,500 with a median square footage of 4,160.

Resale market perkin' back up!

The first article, Existing home sales volume retreats to 2004 levels, from the Phoenix Business Journal, reports that Valley resales fell by nearly 2,500 recorded sales from February 2005 to February 2006, according to the Arizona Real Estate Center at ASU. There were 5,455 resales in February 2006, down from the 7,935 in February 2005, but up from the 5,260 sales recorded in January 2006. The median resale price rose to $265,000 in February 2006, up from $257,000 in January. "As prices have stagnated since August, inventory levels have continued to grow, as we suspect an increasing number of speculators are placing their homes on the market," Raymond James analyst Rick Murray wrote to clients on Monday. The article gives a breakdown of the sales and median prices for each city.

http://phoenix.bizjournals.com/phoenix/stories/2006/03/20/daily16.html?t=printable

The second article, Resale market perks up, from the Arizona Republic, also reports on the housing market numbers released by the Arizona Real Estate Center at ASU. Jay Butler, the director of the Real Estate Center, said the market direction wouldn't be clear until the second quarter. Investors placing their homes on the market was again cited for the big increase in inventory. "We're getting a few more buyers coming out and looking around, but the inventory is going through the roof," said Floyd Scott, designated broker of Century 21 Arizona Foothills. "Investors are rotating out, going to Dallas and Austin. They bought the resale market last year, took the inventory right out of the market and everyone raised prices...We're still trying to find our legs on whether these prices will hold up or there will be a small decline this year. It might soften a little bit because of the price increase last year," he added.

http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/arizonarepublic/business/articles/0322resale0322.html

In the News 03/20/06

The first article, Phoenix's Sunnyslope gets new look, rising interest, from the Phoenix Business Journal, reports that the Sunnyslope neighborhood, bounded by 19th Avenue, 16th Street, Northern Ave. to Peoria Avenue, has seen a renewed interest in its real estate, and rising home values. Two years ago, the average price of Sunnyslope homes ranged from $80,000 to $100,000. Now most sell over $200,000. Many of the homes are older, with about 1,200 to 1,500 square feet, one-car carports or garages, and few pools. This area is slowly redeveloping and is experiencing renewed interest due to its close in central location.

http://phoenix.bizjournals.com/phoenix/stories/2006/03/20/newscolumn1.html?t=printable

The second article, Phoenix's real estate industry is talking transportation, from the Arizona Republic, reports that developers, real estate analysts and economists are all talking about what will happen to the Valley's already congested roadways as the area continues to grow. Housing analyst RL Brown, who isn't a big fan of light rail, has brought the possibility of starting commuter rail service on the Valley's existing roadways. In January, Drew Brown, president of developer DMB, half joked that Interstate 10 would have to have 20 lanes to support all the new homes planned for the Southwest Valley. Greg Vogel of Arizona Land Advisors said that land for a reliever road to Interstate 10 in the West Valley should be bought before homes go up and it becomes more costly to buy. In a side note, the article states that buyers shelled out a record $10.2 billion for 225,000 acres of land across metro Phoenix in 2005, adding support to the fact that we will continue to grow as more population comes into the Valley. Buyers paid an average of $34,000 an acre for Valley dirt in 2005.

http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/arizonarepublic/business/articles/0319catherine0319.html

The third article, Homebuilders looking to deal, from the East Valley Tribune, reports that it only takes scanning the local newspaper ads to see some new homebuilders are dealing with a softer market in 2006. For many, its the first time in years that they have had to act more like car dealers by offering fat financial incentives. Engle Homes is offering $30,000 in upgrades, Shea Homes is offering new pools again, and Beazer has advertised price reductions as much as $40,000 on selected homes in its inventory. "The builders are back to marketing houses and marketing subdivisions, which they hadn't been because they had waiting lists for every lot they released," said RL Brown. "Things are getting back to normal, not abnormal. That's a positive sign." Some experts see the incentives as temporary and that builders will work through their excess supply of homes in the market quickly as more people move to the Valley. Part of the excess supply is from homebuyers and investors who are now cancelling contracts because home values have stabilized, or even dropped in some areas.

http://www.eastvalleytribune.com/index.php?sty=61421

Phoenix cost of living remains low!

Phoenix cost of living remains low
The Business Journal of Phoenix - March 10, 2006
by Chris Casacchia
The Business Journal
Despite skyrocketing housing prices, greater Phoenix is one the most inexpensive major metropolitan areas in the U.S. to live, work and operate a business.
Phoenix ranked 8 among 29 major metropolitan areas according to the latest statistics released Friday by the American Chamber of Commerce Research Association, the Council for Community and Economic Research and the Greater Phoenix Chamber of Commerce.
Greater Phoenix's 2005 fourth-quarter index of 100.4 was slightly above the national average of 100, and lower than other metropolitan areas such as Las Vegas, San Diego, Seattle, Los Angeles and Chicago.
The composite index is based on six components -- housing, utilities, grocery items, transportation, health care and miscellaneous goods and services.
Overall, the report shows the standard of living ranged from more than twice the national average in Manhattan to more than 20 percent below the nationwide mean in McAlester, Okla.
With a composite index of 88.9, Houston ranked as the most affordable large metropolitan area.
Even with the Valley's recent spike in home sales, which appreciated more than 35 percent in 2005, the housing market remains only slightly above the nation's average with an index of 101.8. In comparison, Las Vegas had a housing index of 134.8.
"Up until last year, the supply and demand of housing was such that housing was always very reasonable," said economist Elliott Pollack, of Elliott D. Pollack & Co.
Greater Phoenix's affordability makes it an appealing target for relocating businesses as job growth, he said.
"Because it's easy to attract employees, it's easy to attract employers," Pollack said.
The Valley has attracted some large employers within the last six months, including Google Inc., which will create 600 IT and engineering jobs, and AAA, which will locate between 900 to 1,100 new jobs in a new information technology and customer service center in Glendale. Intel Corp. also announced a $3 billion expansion in Chandler.
According to Global Insight Inc., Phoenix's employment base grew 4.1 percent in 2005, while its economy expanded 8.6 percent.
Most of this growth can be attributed to the scorching real estate market of 2005.
The Massachusetts economic forecasting company named Phoenix, Las Vegas and Orlando, Fla. as its leading cities for job growth in 2006.
Katie Pushor, president and chief executive of the Greater Phoenix Chamber of Commerce, said the index reflects why the Valley is a great place to start, relocate and grow a business.
"Employers are better able to afford to add new workers in our market compared to other metro areas, where employees demand higher salaries due to the cost of living," Pushor added.

Homebuilders have their eye on Fountain Hills

Home builders eye state trust land
Fountain Hills may annex site
Jessica Coomes The Arizona Republic Mar. 15, 2006 12:00 AM
FOUNTAIN HILLS - At least four major Valley home builders are interested in developing the more than 2 square miles of state trust land north of town that the state plans to auction and Fountain Hills plans to annex.• Fountain Hills-based MCO Properties pictures high-end, custom homes on most of the developable land, and would build far fewer than the land's 1,750 potential home sites.• SunCor Development Co. of Tempe imagines homes on the same piece of land that would capitalize on the surrounding open space. • Pulte Homes, with regional offices in Scottsdale, also is interested in the state trust land, but spokeswoman Jacque Petroulakis declined to comment about Pulte's possible plans.• Toll Brothers Homes, which also has regional offices in Scottsdale, is interested, but also declined to divulge specifics, a representative said.The 1,312 acres of state trust land will be auctioned by June to the highest bidder by the Arizona State Land Department. "It's such a magnificent piece of ground, and that's why we're working so hard on it," said Jim Adair, SunCor's director of community development. Fountain Hills officials are working with the Land Department to decide what the eventual owner, or owners, of the land will be allowed to build.A proposed agreement between the state and the town would allow a developer to build no more than 1,750 homes, while keeping at least 700 acres as open space and still having room for a 42-acre park, a 12-acre commercial area and a resort.On April 20, the Fountain Hills Town Council will consider the agreement with the state and an amendment to the town's General Plan, which guides future development. If, as planned, Fountain Hills annexes the property in the coming months, the eventual owner will be required to build according to town codes.
MCO details plansIf MCO wins the auction, the state trust land project could be the company's last development in town.After the company wraps up its Eagles Nest and Adero Canyon projects, MCO, the successor to the town's master developer, would be out of major parcels of land on which to build.Though MCO would like to build mostly custom homes on the state land, it also would like to construct some production homes and multifamily buildings, MCO President Jeremy Hall wrote in a letter to town officials.Fountain Hills is zoning most of the property for lots from 6,000 to 10,000 square feet. MCO would build homes on much larger lots, and Hall said he fears MCO would have to get the lots rezoned after the auction, which he said could be halted by a referendum.This risk, Hall wrote, would hurt MCO when attracting investors.Town Manager Tim Pickering allayed Hall's apprehensions in another letter, writing, "The town would welcome, and the proposed GPA (General Plan amendment) would allow, a development scenario utilizing a higher number of larger, custom lots with fewer community lots."
SunCor's thoughtsSunCor previously worked with MCO to build the SunRidge Canyon development.If SunCor won the auction, Adair said it would like to build a development similar to SunRidge Canyon, which has homes from 1,700 to 3,500 square feet with even larger custom homes.Adair said the company would market the open spaces, though it does not plan to build a golf course.SunCor would like to build the maximum 1,750 homes, although Adair said he does not think it would be possible because of limitations from the steep slopes in some areas and sewage hookup limits.Ron Huber, general manager of the Fountain Hills Sanitary District, said the current facilities could not handle 1,750 homes without the construction of a new sewage treatment plant, which would cost the developer millions of dollars.The district can currently handle as many as 1,071 new homes, Huber said. That capacity could be greater, he said, but the developer would have to commission a study to say for sure."Wastewater is a challenge at this point," Adair said. "We're trying to figure that out."SunCor had submitted an application to buy the land, which started the ball rolling for the sale. After submitting the application, Adair said, the company had little involvement with the planning.
Highest bidderSunCor does not get any preferential treatment on auction day. The winner is the one who spends the most money.The state appraises the land, and the appraised value is the minimum it could be sold for at auction. The trust property near Fountain Hills has not yet been appraised.The Land Department's goal is to get as many bidders as possible to boost bids on auction day. Public K-12 schools receive about 90 percent of the revenue from state land auctions, with the rest divided among several state agencies.Deputy Land Commissioner Richard Hubbard said he did not know how many developers would bid on the property near Fountain Hills, but, "Anything could probably happen."More than 9 million acres of Arizona land set aside at statehood in 1912 remains in a trust that is managed by the Land Department.

In the News!

3 offices sold for $144 mil, from the Arizona Republic, reports that three Valley office properties changed ownership on Wednesday in a $144 million deal. The deal included the Gainey Ranch Financial Center, the Scottsdale Executive Office Park, and the Paradise Village Office Park. The deal is one of the larger commercial portfolio transactions in the Valley and highlights the attractiveness of local properties to institutional investors. The buyers were a joint venture between Los Angeles based Lowe Enterprises Real Estate Group and GE Real Estate. They plan on spending $1.4 million in property improvements.

http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/arizonarepublic/business/articles/0302gaineysale02.html