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Thousands of Phoenix Cheap Homes for Buyers and Investors

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By : John Cutts    99 or more times read
There are currently about 42,000 Phoenix cheap homes available on the market for both owner-occupant buyers and investors, but this already high number could shoot up further because there are thousands more from lenders, from the early investors and from the delinquent pool.

According to Mike Orr of Cromford Report, there are currently 42,500 houses listed for sale, up from the 40,000 units listed in December. Another 50,000 units could soon enter the market as this is the number of pending foreclosure postings in the area, according to analyst Tim Sullivan.

Additionally, there are also over 50,000 foreclosure properties that have been bought by investors over the past months, and many of these units may be resold by investors in the next several months.

Lenders in the area are also keeping over 5,000 units that they have repossessed from foreclosure auctions in Phoenix, but have not yet released to the market.

In addition to these already high numbers of Phoenix cheap homes, thousands more units are expected to enter the foreclosure market as about 30 to 50 percent of mortgaged houses in metro Phoenix are delinquent. The high number of homeowners whose loan modification applications have been rejected is also expected to overload the market with foreclosures.

With these staggering foreclosure numbers, finding and buying cheap single family foreclosures will not be a difficult task to do in Phoenix. Currently, the sales price median for houses in metro Phoenix is around $127,000, down from around $130,000 in the latter part of 2009.

Analyst Sullivan said that the dumping of another 50,000 low-priced units into the Phoenix market will push the median price further down to around $120,000.

There are a lot of uncertainties surrounding the Phoenix market, according to analysts like economist Elliott Pollack. He explained that a large number of homeowners will strategically default because of their equity losses while others will give up if their mortgages are not modified, but estimates of these borrowers are difficult to predict.

There are, however, analysts like Tom Ruff of Information Market who are more optimistic about metro Phoenix. They contended that investors will not resell immediately the homes they purchased, particularly those who bought with cash.

According to them, although the recovery of Phoenix will take longer, the metro area will no longer suffer a big housing market crash because the high number of investors looking for and buying Phoenix cheap homes will help absorb the inventory.

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