Searching for Happy Endings in Phoenix Real Estate

Received an e-mail from a past client today and I have to admit it left me a bit saddened, though the story wasn’t anything I hadn’t anticipated.

This couple just happened to purchase a home in June 2005 and since have watched the value dive. The good news, if there is any, is that their home happens to be in one of the areas that to my mind at least have over-corrected fairly seriously. The bad news is even with the over-correction, we’re years away from seeing even the slightest hint of a significant upward movement in price.

Maybe we all should have seen the crash coming. It’s easy enough to say that in hindsight. I’m not sure many saw the depth of the housing collapse or the length it would take – and will take to clear. And for those who did, congratulations on betting the Don’t Pass line when no one else was doing so. On such foolishness as the rest of us displayed, Las Vegas was built.

For these folks, unfortunately, there’s not much that can be done right now. Without equity, none of the exit strategies are attractive. For others, who still have some equity and are looking purely for investment, there are options.

Those keeping score will note this is the second time this week I’ve mentioned this, so let me throw in this caveat.

If the Valley of the Sun is going to be your home, none of what I’m saying really applies. Yes, real estate is an investment but there also are the intangibles that go with owning a home that don’t matter to an investor. You can rent until you’re sure we’re at bottom, hope interest rates and prices haven’t moved up in the interim, and go from there. Of course, in some areas the price of renting is higher than the price of owning but that’s another story for another day …

If you happen to be looking at a vacation home first and foremost that you might rent out on the side, again this doesn’t apply to you. Again, there are reasons you’re looking here – the weather, the golf, the pro sports, the community amenities – that may not exist in similar abundance elsewhere. Maybe you want to wait longer. If you happen to be a Canadian, though, it would seem the only direction for the loonie to go is down.

These two groups can have a happy ending in Phoenix real estate. It’s more than possible with a decent timeframe and a dose of patience.

For the pure investor … well, you can still get the happy ending, too. But it’ll likely come sooner and be more lucrative in other places.

If only all of us knew these things a few years back.

Jonathan Dalton

Jonathan Dalton is a 40-plus-year resident of the Valley and has been helping folks buy and sell homes since 2004. He can be reached at 602-502-9693 or info at