Demand for Foreclosures and Foreclosed VA Homes in Phoenix

by on cities

Phoenix is rising fast from its real estate collapse, with investors and home buyers bidding against each other to acquire forclosed VA homes and other foreclosure homes.

Phoenix realtors have observed that more houses are being sold than at any period since 2006. Just like the past housing boom, investors and home buyers are again outbidding each other in getting the forclosed VA homes and other foreclosure houses that they want.

Real estate agent Shannon Hubbard said that people are getting over their doubts and hesitation and coming out to look at houses and buy.

John Burns of John Burns Real Estate Consulting has previously cited Phoenix as the housing market with the most potential in the nation. He said current affordability is the best since the early 1980s and buying a home in Phoenix is a better financial option than renting.

Phoenix’s housing market had the steepest collapse in the country, with median home prices in June 2006 reaching $268,000 and then diving to its current lowest at $120,000. The city’s median home price decline is the steepest among the top 20 metro areas monitored by the S&P/Case-Shiller price index.

The housing collapse battered Phoenix, which depended on the housing sector to drive its economy. In 2008, the city lost 136,000 job slots in all sectors, including 41,000 job slots in the construction sector which represented 7 percent of the city’s workforce.

As home building stopped, workers, immigrants and realtors left, causing a free fall in home prices in the last two years.

It was only in March when the home price decline in Phoenix slowed. Realtors are hopeful that the housing market has reached its bottom and that it is starting its way to recovery as the inventory of homes, including foreclosures and forclosed VA homes, declined from one year’s worth to nearly half a year’s worth.

Karl Gunterman, business professor at Arizona State University, said the incremental slowdown of the decrease in home prices could be a sign that the market is bottoming out.

However, other housing analysts argued that the bidding wars for forclosed VA homes and other foreclosure may be a temporary thing and that the volume of bank owned foreclosure homes for sale has declined because some lenders are still holding off on their foreclosures in anticipation of the expansion of President Obama’s housing programs.

Nevertheless, many in Phoenix are encouraged by the positive affordability levels and rising number of homebuyers for existing homes, foreclosures and forclosed VA homes.