I just got back from a week in Phoenix.Wow.
Where do I start.
The Phoenix metro area was built on housing and commercial real estate speculation, out-of-control big-box retail, massive illegal immigration, REIC conmen, stupid urban planning, and cheap-gas sprawl. The government was run by realtors and developers, the population got caught up in speculation, debt and over-consumption, and then the entire house of cards collapsed.
The good news? Home prices and rents are crashing, making it affordable like it used to be. The illegals are going home in droves. Another Best Buy won't be built for fifty years. What's left of the desert is beautiful. The realtors and mortgage brokers have been discredited and shamed. And above all, foreigners, the banks and US taxpayers are on the hook for Phoenix's losses, not the Phoenicians themselves.
After home prices fall 50%+ and the bubble is finally washed away, Phoenix may one day rise from the ashes. They'll need to bulldoze the crap wood-framed homes and empty big-box stores, they'll need to reinvent their economy with green jobs like First Solar, and they'll need to make sure the REIC is run out of town forever.
And yes, no matter what happens, the Cardinals will still suck. You can count on that.
Home prices continued their downward march with Phoenix leading the nation, according to the S&P/Case Shiller Home Price Indices released Tuesday.
Fourteen of 20 major markets recorded the worst price drops ever for single family homes with double digit declines between October 2007 and October 2008. But Phoenix fared the worst by far, with a one-year depreciation of nearly 33 percent.
According to a Standard & Poor’s news release, “Phoenix remains the weakest market, reporting an annual decline of 32.7 percent, followed by Las Vegas, down 31.7 percent, and San Francisco down 31 percent.”
Other markets with housing price declines in excess of 25 percent were Miami, Los Angeles and San Diego.
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35 comments:
I bought my PHX house for $149K in 2001. Now, Zillow says it's worth $218K. Frankly, I hope it keeps going down. I don't see selling this house. If I do, it will be because I have kids and need a little bit more space. I would just as soon have the price of upgrading continue to diminish.
If in the meantime, Phoenix's economy becomes based on more real production and less middlemen, less big box retail and less sprawl, that's even better.
Of course, if I get laid off, it would be nice to dump the house on someone else and pocket the equity.
Stupid urban planning? - Where do you arrive at this? Phoenix, as viewed from the air seems to be divided into perfect square mile sections - to follow the original survey grid that most of North America was divided up back in the 1800's I can always find my way around Phoenix - I always get lost in European cities and the east coast cities where there is no grid, just roads going all over the place like a bowl of spaghetti.
Unchecked urban sprawl is stupid urban planning.
Putting a new football stadium and hockey stadium in the middle of nowhere is stupid urban planning.
Having no center or soul is stupid urban planning.
Phoenix represents all that is bad with car-based, strip-mall-obsessed, realtor-dominated urban planning. The outer fringes will be modern ghettos soon, dominated by empty homes, drug dealers, gangs and meth labs. And in 50 years, much of the metro area will need to be bulldozed as gas prices make living on the fringes impossible.
Phoenix and LA have a shared destiny. Beautiful landscapes destroyed by the REIC.
For a look at how western cities could and should have been developed, look to Portland or Boulder. For a look at urban nightmares, go to Vegas, LA, Phoenix or Tucson.
Yes, Phoenix has nice little predictable grids. And a Circle K is always within view. I can get gas and groceries on every corner. So, if you measure your life in basic conveniences, Phoenix is great. If you want great art, historic buildings, charming neighborhoods, you have to look a little harder in Phoenix. It is diluted in a sea of Walmarts and Home Depots.
Yes, you can get lost in European cities. I got lost in Venice. It was one of my favorite moments in my five-week post-college tour of Europe.
Let me put it like this, I moved to Phoenix from Cleveland in 1997 ... and I really miss Cleveland.
But Greg Swann said we'd bawl balefully and never admit we were wrong!
Heading to San Diego on the 1st for some training, can't wait to see how much it has changed. Last time 2 years ago, everyone was talking about how much money they had and how they are living in houses that just keep going up. God its going to be great.
keith,
The new stuadium in the middle of nohere?Dude you are way off here brother.I happen to like he phoenix area.the downtown area needs some work.The area is going to keep growing as more people leave ca and the bullshit there.Weather is great for 6 months.housing is way more affordable now.Those ghetto towns you refer are actually pretty nice.New homes for young families and first time buyers.
So... how about that new billion dollar light rail system in Phoenix?
Saw some punk rammed his old Honda into it, pretty funny shit...
Light Rail Crash
Greg Swan stays in business how?
"The economic fundamentals are strong".
-George W. Hoover-Bushco (R), soon to be former two-term 'War" President indicted for War Crimes and Murder and Most HATED and Despised man on the Planet.
-John INsane McCain (R), failed, shamed and disgraced forever GOP Presidential candidate and soon to be ex-Senator from the Wonderful Wining state outlined here of Arizona.
Two examples of shining beacons for Freedom and Democracy
See any paralells or similarities?
DIE YOU PIGS. I hope 2009 brings each of you misery, sickness and death. You have earned it.
America is DEAD
The huge drop in prices now makes Phoenix an economically attractive place to move to from other areas. That was the model all along, until everything went crazy.
And Phoenix is still like a junior high student that does not know yet what it wants to be when it grows up.
That is the beauty, since there are opportunities along with the unknown. And to be sure, lots of problems to solve, like any other major city. Especially the RE mess.
I've said before on older blogs, I have lived many places, and traveled to just about every city and state in the US, and most all of Europe, and Phoenix is the place for me. Also, I live and work downtown, and the positive changes here are nothing short of dramatic.
Peace.
Keith,
My wife and lived in Phoenix for 1 year (2000) while working on a project. From what we've gathered, that year seemed to mark the turning point for what "was" and now "is" the Phoenix metro area.
The climate was way too dry for my tastes, but my wife loved it. We've made several return trips since then and were able to see the REIC bonanza take over.
Of course, on a scale, there are probably other areas that rank at or above Phoenix in the level of damage inflicted by the REIC on those communities.
I'd list Atlanta, Miami, Las Vegas, LA, and parts of San Diego, Chicago and Orlando as areas that were NUKED by the REIC.
S&A'ers. Who else would you add to the list?
Re: the link from hp fan's 3:04 PM post:
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“Phoenix police Lt. Kim Charrier said surveillance video from the train could be used to help identify the driver.”
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If that fails to produce results, it may eventually dawn on the Phoenix police to check the driver’s registration and license plates in order to identify the driver.
-Mammoth
I live in the Phoenix area and this place is hell on earth. Spineless, souless, monotonous. The people here are arrogant, uneducated dimwits. I can't wait to get out of here and watch it burn to the ground from afar.
Easy there Keefer. I will be in attendance for the Cardinals playoff victory vs. Atlanta in Glendale on Sat.
I hope we do re-invent ourselves out here. I just may not stick around to see it. Did you get flashed by photo radar?
Look at the twin shities, Monnysoooota. Right behind Cali and Phx. They called anyone who dared speak of a housing bubble chicken little and doom and gloom. THEY PARTIED LIKE ROCK STARS. Every waitress and 20 year old kid owned 4 houses and they new how to borrow against their houses.
Their veiw of working people was sickening. Their culture is and was corrupt. I wish I could say they alone will pay for their greed arrogance and stupidity, but they won't. Barrack the Messiah will shower them with newly printed 100 doller bills so that they may party on and it will be good. (Oh he will also pay off their 5.2 billion doller budget deficet while he has the presses running.)Every conservative subculture in this country can sit back and watch their savings and futures be forever destroyed. ORRRRRRRRRRRRRRRRRRRRRRR NOT??????? Hmmmmmm?
Ross,
Sorry man. Bad way to start the new year.
Falcons will beat Cardinals. They're going down just like housing prices in your town.
Also, what has happened to QB Matt Linert?
I reside in Phoenix, and it is a great place to live.
You are correct though, i.e., the Realtors and their cohorts in crime really screwed people here.
"My wife and lived in Phoenix for 1 year (2000) while working on a project. From what we've gathered, that year seemed to mark the turning point for what "was" and now "is" the Phoenix metro area."
You nailed it. It has changed dramatically.
"I live in the Phoenix area and this place is hell on earth."
A number of people have said the same thing, and have come back. You should consider leaving to see if it is not your cup of tea, but would glad to have you back.
In my generous attempt to help the AZ economy, I will be attending the Cardinals/ Falcons playoff game. (Only a quick jump from Vegas).
Good move having the stadium designed by Peter Eisenman, one helluva architect. One helluva stadium design.
Will the Cardinals win?
No.
based on my analysis of the Case-Shiller Index from October, housing still has a long way to go down.
Take New York for example. If you look at the pre-bubble appreciation rate in the mid-90's (94 to 99) it is about 3.75% annually. if you apply this rate from 1999 to 2008 the index should be at around 136. The index today, as reported by Case Shiller, is at 190. That means the index should be around 30% lower than its current level.
So, there should be at least another 25% to 33% decline in house prices in New York to get to the correct equilibrium between household income and house prices.
happy new year keith
what a year it has been! i am personally losing my ass now even though i knew it was coming and tried to prepare! oh well fuck it! anyways i find it outragous the cheesecake factories, nba games, nfl games, best buys etc are still going strong with sheeple! how do these people do it with a conscience (can't spell today) I wish i would have heloced my ass and did what you have done and traveled euro land and cruise ships!
rich in fl
Frat Swinert looks like he's been practicing the quarterback position a little bit, after perfecting his beer bong making skills in the summer of 2007. He probably needs another humbling year of sitting and watching Kurt Warner put up big numbers in a pass happy offense.
I welcome the housing bust in my town. I cautiously stayed away in 2004, when I was offered up fraud housing money on a silver platter by a broker "friend" of mine. The person who actually bought the same house was foreclosed on last December, upside down by 30% in an option arm.
I watch my friends and family whine every day about "all the money" they've lost since their house prices dropped. When I remind them that it was all fake, they seem to come around a little. But hey, everyone wants money for nothing, including Matty Leinart.
I thought it was different in DC?
Greg Swann must hate the internet
I'll never understand how the NY area is down only 12%.
I'd tend to agree on the crap built houses there. I was part of the construction work force from around 99 to 01, when the price boom hadn't even started. There was already a shortage of qualified carpenters back then. The city expanded radially outward at a pace of about 10 miles every couple years. I remember when they put the first tract up in Maricopa. Now that was a weird sight to see.
"You are correct though, i.e., the Realtors and their cohorts in crime really screwed people here."
How about taking some personal responsibility: something lacking in the U.S.
No wonder the U.S. is going to sh** when everyone feels they are entitled but not responsible.
Scottsdale has only come down 20%. Needs another 50% at least.
Best financial podcast around, out of Scottsdale, AZ.
http://patriotarchives.blogspot.com/
Swannnnnnnnnnnnddddddddddiiiiiiiiiivvvvvvvvvvvvvveeeeeeeeeeeeeeeee!!!!!!!!!!!
"And in 50 years, much of the metro area will need to be bulldozed as gas prices make living on the fringes impossible."
If we are still using non renewable fuels to power our vehicles in 50 years the entire country will be f$cked not just Phoenix. Arizona is the perfect area for solar. If we ever get our shit together there could be inexhaustible energy for the state. H2o however is a different story as California is stealing most of that to hydrate their illegal alien population.
I haven't commented here in a long time, but ahh, I just can't resist a good Phoenix post :)
On urban sprawl, I had NO IDEA just how hugely spread out the place is until I moved away. Although I'd have to disagree on Boulder - having beggars and panhandlers all over the streets bothering you kinda ruins everything else about it. I can get that on Mill Ave in Tempe.
Had an interesting conversation at dinner last night with a friend of ours who bailed out of there when the jobs disappeared and moved back to her native San Diego. She doesn't even follow any of this stuff and even she commented that Phoenix is f*cked because the city's only real industry in the recent past was real estate.
As for the outer fringes turning into modern ghettos, just look at Palmdale, CA. It's a dead-on accurate picture of what the outer suburbs of Phoenix will be soon (except of course the ones that already are). Palmdale is a center of meth labs, gangs, hookers, etc., masquerading as a nice suburb.
Oh wait, I just described all of Scottsdale south of Shea. LOL!
Oh c'mon Keith, don't bash my Cardinals! Everything else is fair game....
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