2010 Real Estate Outlook

When 2009 first started off the Real Estate market had a mess that no one was willing to predict except for saying that there were going to be foreclosures, lots of foreclosures. Even a person that isn’t in the market on a daily basis like myself can predict foreclosures in a declining economic event that the US and world is experiencing.

The Real Estate market within the Phoenix/Scottsdale market during 2009 has, to say without a doubt, been an exciting year. If you want to purchase real estate it is truly a great time to buy. The homes under $150,000 are experiencing multiple offers and a true sellers market. The buyers who are able to buy are those that have cash or strong credit with a large percent to put down (10% to 20%). The Banks who are the typical sellers in this range have Asset Managers overseeing the transactions in hopes to receive the top dollar. They are impossible to be contacted by the Buyer’s representation; their Realtors just upload the offers into a computer system where they determine which offer they will accept. There appears, at times, that there is neither rhyme nor reason to why they accept one offer and reject another. To me it appears the closer to the end of the month if the Asset Manager has a huge number of units still on their table the chances of buying one is a bit better, they just want the units gone.

The $150,000 to $500,000 market is moving also not as active as the lower dollar but moving. Some of these homes are those that sold during the peak upwards to the $1,000,000 range, and have some very nice upgrades. Many of these are still attempting to Short Sell the home but this can be a very time consuming process however the reward if the Banks accept the offer can be tremendous.


The million dollar home market is ripe for good deals right now too. Homes that cost more to build are being marketed and sold for tremendously less. To many on the market to choose from, but if you have the time and the capital you can purchase 5,000 or more square feet for a great buy. There are custom home lots in several plush highend areas available for unheard of prices and, they too are seeing foreclosures.


The Foreclosure market is going to remain strong into 2010 and I really do not see our President Obama actually helping too many of those folks in the process of foreclosing being saved. It isn't to say theat he isn't doing anything for them they just don’t want to be saved, they have seen their homes devalue and all they can see is the loss. I try to remind people that when they buy an automobile they see a 30% devaluation as soon as they drive off the Car lot and that loss will never come back, at least with the home that they live in it does have a greater possibility in 3 to 5 years of gaining back the lost value.

If you don’t need to sell and you can afford the payments then why move? You still have the tax advantages of the home ownership tax deduction and with that alone you will be holding your own. Will you earn back what you claim that you have lost? If you mortgaged the home there shouldn’t be any problems, try to amortize your payments and the potential loss will be much less.

Oh but you say; if I let this one go back to bank I will be able to purchase more house for less money. Well not exactly. Since you will have a deficiency against you now you will be paying a higher interest rate and any savings that you think that you are gaining is going to be lost with the higher interest rate.

The Best bet, stay where you are at if you can afford the house payment. Try to buy another house if you want, but be advised that it will be a second home and you will be expected to have 20% in cash to make the purchase.

It is still a great Buyer’s Market, yes, cash is king but if you have a strong credit background and some Skin in the game (20% capital to put down) you can purchase with mortgaged money and get a great home at a great price.

Call me and we can discuss the market.
602-549-7994 DougFry@douglasfry.net www.DougFry.com