I heard about this a few days ago, but now the media has picked up on it. Randall Martin Homes, a smaller sized builder has announced that it is letting the lender take back the remaining of their vacant lots in certain communities. Surprise’s Marley Park, Avondale’s Roosevelt Park, Chandler’s Dobson Crossing and Gilbert’s Higley Park are the communities effected by this decision. Obviously, they couldn’t make their payments in the Valley’s Housing Market downturn.

Existing homeowners will not be affected, other than having a number of vacant lots throughout their neighborhoods. Randall Martin has committed to finishing any existing contracts with homes under construction, but will not be starting any new ones in those areas.

Two other builders, Turner-Dunn in Pinal County and Trend Homes Inc. in Gilbert, have had similar problems in the past two years. A private equity company purchased Trend last month and is sending it through bankruptcy reorganization. Turner-Dunn walked away from 200 unfinished homes in 2006.

- Cathryn Creno, azcentral.com

My take on this? I’m sure another builder is already in negotiations with the lender to purchase the lots at an AMAZING price. This happened out in Queen Creek a year or two ago. A number of lots we sold at pennies on the dollar from a builder who just couldn’t financially compete with the market. The result was 3,000-4,000 sq ft homes, fully loaded with every upgrade you can imagine, being offered at $250,000 starting price. Yeah, I wish I would’ve jumped on THAT opportunity! It’ll be interesting to see over the next year who capitalizes on the situation, and at what price they release the new homes. I also anticipate at minimum of 2 other builders doing the same thing this year.

Here’s another article on it.

ok guys, time to gear it up here. Just came across a SMOKIN deal in the Gilbert/Chandler area. Here’s the specs-

1750sf, 3 bed/ 2 bath, No Pool, Single Level, built in 2005, It is a Bank REO, and the Fair Market Value is anywhere from $250,000 to $300,000+. We can get it for less than $190,000.  Did I mention it’s in a gated community? It’s off of Germann and McQueen, roughly. This is a GREAT DEAL for someone as a rental, or, owner/occupy. If you are interested, give me a call and we’ll go snag it! A deal like this WILL NOT last long, so we gotta move fast!

Arizona State University’s W.P. Carey School of Business has published a new way of measuring appreciation rates here in Arizona. It’s about time someone came up with a solid way to tracking this data!  Instead of rehashing out the entire study- here’s the gist of it.

They tracked houses that have sold previous, and compared them to what they’re selling for NOW to come up with a measure of appreciation between the 2 dates. Now, because of the seasonality of the Real Estate market, they compared like months to like months to maintain some consistency. It’s the exact same thing I do in my own analysis on the market.

Now, don’t get confused and freak out when you see these charts! This is the Repeat Sales Index, not where the prices are currently! If you look at the charts and not read the article, you’d freak out thinking your home and other investment property has lost 50% or more of their value. THAT IS NOT TRUE. These charts are the RATES OF APPRECIATION, not home prices. So, during the boom, Chandler had a 48% appreciation. Now, it’s slightly declined in value. When you look at the chart for it, it’s pretty dramatic. Just make sure to keep some perspective and remember, this is the RATES OF APPRECIATION.  Check it out here.  Finally we have a legitimate and current source to track our appreciation rates.

Repeat Sales Index - ASU W.P. Carey School of Business.

If you have any thoughts or comments, I invite you to post below!