Southern Arizona Housing Market Moving Back to Normalcy
While there may be a national housing slump, local experts believe that Southern Arizona housing and land sales have gone from crazy to normal.
According to the San Pedro Valley Sun-News, most see steady growth here, despite what is happening in the rest of the country.
While the national property-sale market may be decreasing, local real estate agent Mary Ann Scott said Benson, Ariz., is not on the path to a slowdown, but back to normal.
“Land sales have taken sort of a nose dive right now because landowners have priced themselves right out of the market,” she said. “The market right now is being called a corrective market.”
Until prices adjust, Scott said Arizona mortgage activity and sales will remain slow throughout the San Pedro Valley. It is unlikely home prices will rebound to last year’s levels any time soon.
“It was almost like a panic-buying mode in 2005,” she said.
“People were coming in from everywhere and buying whatever they could get their hands on. Compared to [California housing prices], even the overpriced land here looked fabulous to them.”
In 2005 and 2006, because Benson’s land became popular for housing developers and real estate investors, undeveloped land was being sold for up to $12,000 an acre. Will White of Arizona Land Advisors in Tucson said prior to the boom, land cost about $4,000 an acre.
“The general overview of the market is it’s taking a well-deserved breather right now,” White said. “The land developers and investors are taking a break.”
Developers already in Benson plan to proceed. Ernie Graves of the Whetstone Ranch development on State Route 90 said while reports say the national housing market seems to be going downhill, they remain optimistic.
Graves said national home builder D.L. Workman recently pulled out of projects in Whetstone Ranch, forcing Graves to contract with local builders from Tucson and Sierra Vista.
“It’s obvious the national builders are cutting back,” Graves said. “We’ve lost some of them but already signed up with some others.”
Graves said he’s not really focusing on the number of homes being built, but whether or not they are moving forward. The Cottonwood Bluffs portion of the development sold about 30 homes last month.
When it comes to new and existing homes, Scott said it’s going to be a long time before the market slows down in Benson.
“There is a major need for new homes,” she said. “I think the national builders may have underestimated our market, but the buyers are still here.”
City officials had expected more growth in 2006, especially as Arizona mortgage costs remained low, but are nevertheless pleased with the slow pace of development.
City Manager Martin Roush said it’s not as slow as some may think, since permits for 106 new homes were pulled in 2006, compared to two in 2005.
“I don’t have any concerns about the market,” Roush said. “Growth is going to come; it’s just a matter of when and how much. If it slows down, it’s not necessarily a bad thing. That allows us to get caught up.”
John Davis, a mortgage broker, said he’s been working with Workman on Homes in the Whetstone Ranch development since September. In that development alone he said more than 50 homes were sold, historic for Benson.
“The year before, there were only two homes total. That doesn’t point to a slow-down in the market,” he said. “They went from two or three to dozens and dozens of homes.”
Davis said that many of the new home buyers are winter visitors who don’t want property in Tucson, but want to be near the big city, making Benson the prime location.
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