This is a summary of the notes and information that I included for 2008 on the maps that I prepared
and made available "for Public Use" in the information boxes at the two signs I have in Whispering Ranch. One is located by the mailboxes at
299th Avenue and Patton Road, and the other is at 347th Avenue and Carefree Highway, so depending on which way you come in, there were
maps and current information near each entrance. Originally, I was just putting out maps with the listings of properties for sale, but I broadened
the scope to give more people an idea of what was happening in the market, and how market changes were affecting Buyers and Sellers in the area.
Since there was more space available here on this site than on the maps, I may have gone into more detail or more fully explained events. If you have any questions or comments, please feel free to send me e-mail to me by clicking here.
November 8, 2008 - We have passed our election day, and now have a new political face heading to Washington to steer our nation for the next four years. I hope we have made a wise choice, but only time will tell. We should start the process of dealing with the problems in our economy, financial industry structure, an ongoing and financially draining overseas war, and hopefully a new perspective of how our choices and decisions today will impact our children and grandchildren. Most folks I have talked to agree that today's problems are not entirely someone else's fault. We all to some degree are to blame in this mess that we are in, though there are a lot of unsavory characters who got away with a lot of money they didn't deserve, but this isn't the first time this has happened and it won't be the last time either. Maybe we will learn from this lesson - then again, maybe not.
This election should put us on the path toward a new economic policy by a new administration. With a little luck, we will see more confidence in our economy than we had had in the past two years, and this increased confidence will lead to growth. It will take time to dig ourselves out of this mess we are in, but confidence and positive growth are the starting point. I'm not looking for any great strides, just some small steps in the right direction.
The news from Whispering Ranch is pretty much the same as it was from last month. No reported sales, and those who I took out to look at property are in the early decision stages - gathering information, getting to know the area, looking into the various areas to determine what location is best suited to their future plans, comparing pricing of similar properties and weighing the directions the market is heading - all of which are important to a sound business decision. Almost everyone is in the same position - not wanting to make any significant financial moves until they are more confident in the stability of our economy. Hopefully there will be a change in this mindset in the near future. I don't know when we will start to see activity, but I am ready at any moment should the opportunity arise. Recovery will occur, it's just a matter of time.
As for changes in my inventory, I had one parcel with floodway impact drop their asking price from $29,995 to $23,500. I did pick a few more listings in the $50K to $60K range, but these are Sellers who understand the property won't sell at this price now, but they want to be visible in the local Multiple Listing Service so that when activity picks up, their property will be in the pool of available properties. The old saying "You can't sell them if no one can see them" is the basis for this mindset. They are asking for a particular price, and sooner or later the market will rise to this level. And in my experience, when the market turns, it does so rather quickly, lower priced properties being bought up first, then moving upward through the price range. There are about 160 properties on the market at any one time and pricing ranges from $4,700 per acre up to $18,000 per acre. Lower price = less desirable parcels and Higher price = highly desirable parcels. Later this month there will be a section on the web site where I'll list all of the parcels I have on the market and provide links so you can get the information that explains the variation in pricing for the various properties. If you want to know how your property compares to the others on the market, send me an e-mail and I'll prepare, print and mail an analysis out to you.
I have had a lot of calls and e-mails from owners who are concerned about what has happened to the market, and I am giving everyone pretty much the same advice . . . "If you don't have to sell . . .don't. Wait for the market to recover. If you do have to sell, I'll get you the best price I can in this market, but don't expect much above the current bottom prices." I thought previously that the 4th Quarter of 2008 would be the bottom of the market, but looking at today's economic factors, market conditions and Real Estate conditions, it looks like it is going to take a little longer - possibly the 2nd Quarter of 2009 before we bottom out and start to head back upward. And this is barring any other calamities in our economy. If the "Big Three" - General Motors, Ford and Chrysler start sucking money out of the government, we will need to push our recovery period out farther into the future. Bummer.
For those who are upset about the rise in taxes, keep in mind that I have had the information about how to apply for the Agricultural Exemption using Grazing Leases on the web site since March of 2007. Those who jumped in and got the paperwork done will see these tax savings fall into place in 2009. Those of you who have waited until now probably won't get these savings to start until 2010 or 2011 but better late than never. And once this exemption is in place, keep it there ! ! This can represent a savings of hundreds of tax dollars every year from now into the distant future. And since we don't know when the market will turn or when you might decide to sell your property this could represent some big bucks. For more information, go to the Whispering Ranch web site and click on the paragraph header that says "Grazing Leases". That will take you to the area where you can download all the forms and decide which direction is best for you to pursue.
In the meantime, what can you do towards the efforts to increase the future value of your investment ? ? The politicians running for the various offices impacting this area have now been elected or re-elected, and should now be working on moving forward on a number of issues. The two areas where we can have the greatest impact on getting things done are through 1., the Arizona Corporation Commission, and 2., the County Board of Supervisors. There were three new members elected to the Arizona Corporation Commission. This is the five member commission that regulates the power companies water companies, supervises placement of power lines and pipelines, and grants or denies utility rate increases and/or programs. I have already taken one member of the Commission - Commissioner Kristin Mayes - on a tour of Whispering Ranch, so she is aware of the challenges of bringing power into the area. We will need to contact the three newly elected members of the Commission and advise them of the importance of moving forward on this project. Our Supervisor on the County Board of Supervisors is Max Wilson. I have not yet met with Max, but I have met with Scott Isham, his Chief of Staff, and we have had communication on a number of issues. The areas where we need to focus with this office are along the lines of roadway maintenance and improvements through the Maricaop County Department of Transportation (McDOT), County Services - Building Permits, Planning and Zoning. Since we have seen our tax rates increase by a factor of three to four times, maybe we should all send a note questioning what we are getting for all this additional tax money. The dirt roadways are still in poor shape - plenty of potholes and nobody grades or maintains them, which presents a Health and Safety hazard for everyone who lives in or visits Whispering Ranch. If you have a minute, go to the Whispering Ranch web site and click on the paragraph header where it says "Whispering Ranch Electrification and Roadway Improvement Efforts". You can read through what's happening and I'll set up links so you can e-mail your questions directly to the newly elected Commissioners or send your questions or comments directly to Supervisor Max Wilson's office. In my experience, we won't get anything done by quietly sitting on our hands on the sidelines. So let's wade into the fray. One of my associates recently put it like this - "Getting involved in politics is like wrestling in the mud with a pig. It's not fun for you but pretty soon you discover that the pig likes it."
Bottom line: Market still stinks so we will wait for recovery. New politicians need to be trained. Looks like mud wrestling is called for. Let's get muddy.
October 11, 2008 - So now we are witnessing the failure of banks, insurance companies and financial service companies, and despite the efforts of the Federal Government to stabilize the financial meltdown we are witnessing a significant downward spiral. Home prices are continuing to fall as foreclosures increase, businesses are having trouble finding short-term loans needed to stay in business, unemployment is increasing leading to more of a slow down in spending, and the cycle continues to feed upon its own misery. Times are getting pretty tough. This is the price we all pay for buying the latest model computer, newest big screen TV, the latest model car, bigger house than we can afford while all the time we were counting on a growing economy to fund the future interest we owe on what we borrowed. So who is responsible for this mess?? I think it is the banks who were offering the financing. But nobody held a gun to our heads and insisted we take the money (or the loans) so we have a degree of guilt in this as well. We all have to remember the advice we got from our Grandparents . . . "live within your means, save for a rainy day, don't borrow money if you can't pay it back, don't buy something if you can't afford to pay cash for it". All of these are ringing in my ears and are sound advice.
I may not be the brightest bulb in the pack, but I have been through these "hot markets' in the past and they always come to an end. I consider myself as very lucky, having avoided the temptation of thinking the good times would never end. And I applied the lessons I had learned in the past. When Real Estate was selling and times were good, I didn't go crazy buying the latest and greatest. Now I have manageable debt, and other than a modest house payment and a payment on one of our cars, we only have to worry about every day living expenses. Our retirement investments have been hurt, and it may get worse, but we'll get by. And so will you, if you are willing to remember and apply those lessons that our parents and Grandmaw taught in the past.
The good times are gone. There will be more good times in the future once we work our way out of this mess we created. We have all heard the phrase "When something sounds too good to be true, it probably is". Well, this is what happened in 2004 and 2005 (Boom). Now the lows we are going through (Bust) are the payback for those highs we experienced.
For those of you who are concerned about your 2008 taxes, there is action you can take for the future. You had your chance to appeal to the County in 2007, and if you didn't, it's too late. I have been handing out the information on Grazing Leases for more than a year to those who were far sighted enough to take advantage of the Agricultural Exemption. So, if you want to save on your future taxes, you had better get started right now. And this won't take effect until 2010 even if you start tomorrow, but better late than never. Go to the Whispering Ranch web site, click on the header for the paragraph for "Grazing Leases", read through the information, download and fill out and then file the forms with the County. Or call me and I'll e-mail (or snail mail) the forms out to you.
Now lets' get to this month's activity. I only saw two transactions. I listed one parcel at 308th and Forrest Pleasant for $35K and it sold to the owner who lives next door. The other parcel was just east of 299th Avenue on the south side of Montgomery and I put that one in escrow at $40K. Officially, that's all. Unofficially, there were a couple of five-acre parcels that sold for $8,000 each. So the market is still slow. Buyers right now are sitting on the sidelines, waiting to see if prices will go any lower. But, that has been the case since late 2006. The problem is that when the market turns, it will do so quickly, and if you don't buy in right away, the market will rise past you, and you will have missed the low point.
And, once again, I'll say what I've been saying all along . . . this market will turn back upward . . . I just don't know when it will happen, but it always does.
My perennial optimism is still there despite my inability to see precisely when this market will start to move upward again. I saw plenty of signs that the 4th Quarter of '08
would be the bottom of the market, but the latest events are pushing that timeframe out by another six months or so. We'll see. There is great potential in this area.
September 13, 2008 - In the past month, I have seen renewed activity in property listings. There have been some foreclosed properties coming on line that are priced at $7,000 per acre for high and dry lots. At this price, I am getting some interest, but I still have a lot of prospective Buyers who are telling me they would buy when parcels prices drop down into the $4,000 per acre range, but there's no sign that prices are going to drop to that level. But, what do I know - I didn't think parcel prices would drop under $8,000 per acre, but I currently have 19 properties below that price point. Granted, quite a few of these parcels are "Bulk Sales" where you have to buy at least six five-acre parcels per transaction, but there are still some really nice high and dry five acre properties for $35,000 each that can be bought individually.
On the other side of the coin, most of the properties being listed are in the $12K to $15K per acre price range - some at even higher prices. Most folks know what the real value is of their parcel, and they are not in such a pinch that they "have to sell" and they are aware of what is going to happen once we recover from the current financial disaster we created during the "Boom of '05". These Sellers know that prices will rise - they always do - and they are not going to give something away today that will have a greater value in the future. So they are telling me to put it on the market at a particular price point and we'll keep it on the market until the market rises to that level. So, that's what I'm doing. I am advising people who contact me that you need to do the opposite of what other people are doing . . if they are all selling as prices decline, you should be buying. And if you don't have to sell now, then don't!! Prices are now where they were in February or March of 2005. In September of 2004 these parcels were selling at $2,500 to $3,000 per acre, and I don't think we will ever see those prices again. Then in November and December of 2004, sales increased and these lower priced parcels we bought, with new listings coming in priced at $4,000 to $5,000 per acre. They, too, sold like hot cakes, and the next bunch of listings in February and March were selling at $6,000 to $7,000 and they went quickly too. I commented to one Seller in April of '05 that we needed to plan to raise the price on their parcel by $5,000 every two weeks. We did, and as the market rose, we finally went to escrow in June of 2005 at $18,000 per acre. That was the top of the market, and we have been on a downward slide since September of 2005. A slow decline at first, getting worse in 2007 and 2008 as financial institutions continued to go belly up. But, watch out . . . when this market turns it will happen quickly. The market will turn . . I just don't know when.
Since things are still so slow in sales out in Whispering Ranch, and since there is no sign it will increase in the near future (things probably will stay slow for the next couple of months while we await a few more financial institutions to collapse and an election which will propose new economic policies), I am getting involved in some of the projects in progress. There has been some recent progress with Claudia Gomez's public well getting the Special Use Permit so she can get electricity hooked up and start pumping water, and I think that Enrico is ready to go to the County on getting his parcel on 299th and Patton Road re-zoned. The area could use a "legal" store so everyone can avoid the 30 miles drive back and forth to the nearest store for basic necessities. So I'm calling the political officials who can help us get these projects into the system. It would help to have them. Ant the area residents would all benefit as well.
Our new and improved Multiple Listing Service is still giving agents headaches, and after about six weeks of fighting with them it came to light that the system can't
produce the reports you are used to seeing on the other page, so I'm going to do these reports in another form, giving more information that folks request when they
are looking for a parcel. I'm adding columns that show how many acres in each of the listings, price per acre for each, whether or not these is flood impact and an
approximate distance to power. Let me know if you need other information when I put these maps out and I'll see if I can get it into the mix.
August 9, 2008 - The past month has been pretty active . . . but sadly, not with sales activity.
I spent all morning on July 15th with Commissioner Kristin Mayes of the Arizona Corporation Commission, touring around Whispering Ranch, visiting with a few of the families that would like electrical service but can't get it brought in because of cost and construction issues. We went all the way out to the Vulture Mine and drove through the whole "Ranch" area. Looking at the various houses and how they were surviving on solar panels, wind turbines and generators, having to haul in water to live, the sheer size of the Whispering Ranch area, and the current minimum Health and Safety needs lacking in the area all were a real eye opener for her and her aide. I know this trip has had a strong impact, and will lead to more activity. She asked if there was a chance we could have another "Tent Event" where she could bring other Corporation Commissioners (once she brought them up to speed on the issues), APS Executives, County Officials involved in Planning and Zoning and Roadway Maintenance and Improvements, and Arizona Department of Transportation Officials to lay out plans for Bridges and Roadway improvements. I told her that if she could assemble that group, I would notify everyone about the meeting and arrange for the tent and tables, hopefully for a turnout that would far exceed our last meeting of this type. But I also told her I wanted the exclusive franchise to rent torches and pitchforks at this meeting - expecting business for those items to be brisk ! !
I was referred to Max Wilson's office as well. Max Wilson is on the Board of Supervisors for Maricopa County, and is responsible for District 4 where Whispering Ranch resides. On August 1st, Lynn Valverde and I met for a couple of hours with Scott Isham, Max Wilson's Chief of Staff and went through the items discussed with Commissioner Mayes. We also went into the past history of Whispering Ranch, how it has changed for the better in the past few years, and what it is going to take for the area to move forward into the future. For years the County has resisted anything proposed in this area. We are now at a point where it will be important for the County to cooperate with us in efforts to bring the basic necessities into this area. Our communication with Supervisor Wilson's office was to make them aware of the previous resistance and see to it that we are able to move forward on a level playing field in the future.
You will soon see a number of parcels coming on the market priced to sell. These parcels - priced at $35K for a five acre parcel - are just a few of the foreclosed properties that the property owners are putting on the market at these low, priced to sell prices. There will be more coming on the market once we determine what the price point is for sales in today's market. My advice to not put a bunch of low priced parcels on the market all at once has been heeded, but once these parcels sell, you may see more coming on to replace them. When an owner wants to move their parcels, prices drop. The tough part of the current market is to determine the price point where a parcel will sell. In this market, if you price the property too high - by even $1000 per acre - there may be no interest. And if you drop the price to get interest in the property, are you getting as much as you can for your Seller. Thankfully, with most of the Owners I represent, there is no immediate need to sell, they can wait for the market to climb back and reach their target price. It's a tough balancing act.
Then there are the investor groups. I have had inquiries from groups interested in assembling acreage from 500 acres and up. I am getting the message that these groups see the future of this market pretty much the same way that I do. If we are not at the bottom, we will be before the end of the year. Prices may drop a little by that time, but barring some cataclysmic event, we will bottom out and start moving back upward after the election after the first of the year. It will take time for excess inventory to be absorbed - in both the housing and land market - but as this happens pricing will firm up and then increase.
The market will turn, it always does.
July 12, 2008 - As depressing as last month's newsletter was, this one does not hold out much hope for an immediate change in current market conditions. When I pulled up the sales for the 2nd Quarter of 2008, there were only three transactions. Here's how the three transactions stacked up. . .
The lowest priced was a parcel that had been on the market for almost two years at $34K, but finally the Seller caved in and dropped the price to $7,000 and sold the property for $4,000. Yup, that's $4,000 for a five acre parcel. Some Buyer got a real steal. It's all floodway, but could be a nice grazing area. And there was parcel on the market for $59,888 that sold for $30,238. The only other transaction so far this quarter was a property I had on the market at $65,000 that sold at $57,500. The last two transactions were on the market for less than 60 days, so I guess they were priced right.
Gas prices have leveled off somewhat - stabilizing just above $4.00 per gallon, but that jump is now causing prices to jump up on everything else that needed to be moved from farm to factory to market. We will continue to see these increases as we move forward in time until everything catches up with the increase in transportation costs. But there is good news and bad news. The bad news is that the housing market is not getting any better. The good news is that it's not getting any worse. There have been recent articles about the economy indicating that we may be at the bottom. But with all of the jitters about the weakness in the economy, the large amount of inventory on the market, and uncertainty about a future economic policy from our government on the Federal level (the election in the Fall should clear up that last question) we may just have to resign ourselves to continue to skid along the bottom until the 1st Quarter of 2009. And even then, it appears that it will be a slow road back to a normal market.
So what's in store for Whispering Ranch ? There are a few Sellers getting property back in Foreclosure and Deed in Lieu actions, but I am telling them not to put them on the market at the moment. If they were to do this it would flood the market and drive prices downward even further. We need to tighten our belts, hang on as long as we can, and wait out this depressing market. The economy will recover - it always does - and we will see things returning to normal. Actually, in Whispering Ranch it will probably be better than normal. If you nose around a little, you'll see there is still quite a lot going on. Douglas Ranch is still moving forward with their groundwork (they did extend their timeframes a little), Festival Ranch is still moving forward and there are stores going in at their "Town Center", and a couple of the other developments along the Sun Valley Parkway are getting in front of the County officials and Buckeye planners so they are ready to capitalize on the market as soon as it turns. I am still a burr under the saddle of the Arizona Corporation Commission on the issue of power in 'the Ranch', and now we have the Department of Transportation doing a traffic study to see if we can qualify for some roadway maintenance work. (Thanks to Enrico for being a pest on that issue!)
Will it get better? Yup. Do I know when? Nope . . but I'm watching closely and will let you know as soon as I know.
June 7, 2008 - The current price benchmark for sales activity in Whispering Ranch is pretty depressing. The lowest priced was a parcel that had been on the market for almost two years and finally the Seller caved in and sold the property for $4,000. Yup, that's $4,000 for a five acre parcel. Some Buyer got a real steal. And there was parcel on the market for $59,888 that sold for $30,238. The only other transaction so far this quarter was a property I had on the market at $65,000 that sold at $57,500. The last two transactions were on the market for less than 60 days, so I guess they were priced right. As of today, there are just about 160 parcels on the market, down about 20 or 30 from the all time high. This is probably because Sellers are just letting listings expire since their parcels didn't sell, and we'll see them come back on the market when the market starts to turn and go the other way.
There is a strong possibility that there will be a number for foreclosed properties coming on the market as well, though I have cautioned the Sellers that this would further drive pricing down. Their best bet is to hold on until the market turns and then put the properties on the market a few at a time. So well wait and see what happens.
The overall economic news is getting worse - gas prices continue to rise, breaking the $4.00 a gallon level, causing a ripple effect through the rest of the economy. Recently, there has been an increase in unemployment with more companies downsizing as the economy tightens up. The stock market is all over the map - up one day and down the next. More and more people are having difficulty with the cost of the commute to and from work and normal errands. I quit driving my truck when I don't need to and buzz around on my motorcycle if I don't have a lot to carry or a client with me. It's a simple choice between 20 miles per gallon and 70 miles per gallon. Everyone I know is uncertain about the economy, and I don't see much change until there is a plan by one or other of the politicians running for President to stabilize things and give us a little faith in the future. Until then, we just have to keep our belts tight and conserve where we can. I'll say it again - "The market will get better, I just don't know when." I am just holding tight and planning to ride out the market.
I have heard back from Commissioner Kristin Mayes Office about our efforts to bring plans to get power into Whispering Ranch. She was apologetic about not being
able to focus more attention to our issue, but there is another rate request by Arizona Public Service Company on the table and the Corporation Commission is looking at that
issue first. I don't think they realize that each time APS gets another hearing and rate increase, something gets taken away from the areas like Whispering Ranch. At the last
APS Rate Hearing, we lost the "1,000 Foot Free Zone" for anyone who wants to get electricity. So it now costs you an extra $12,000 to $15,000 to get power brought in.
And the next hearing is going to cost us even more. I think everyone should start e-mailing the Corporation Commission and APS again and maybe we should all show up at
the next public hearing. I hope to have the e-mail addresses on the web site soon so you can e-mail directly from there.
May 10, 2008 - Late this week, I was going through the economic reports and forecasts for the housing industry and the economy in general, and there are indications that some economists surmise that we are nearing the bottom of the business cycle. Some have even stated that April of 2008 was the bottom of the market. We won't know if that's the case for a while. But there are a few wild cards that will have a serious impact on any projected recovery. There is still a lot of inventory sitting on the market - most agree that there is about a years worth of unsold homes to be absorbed into the market - and builders continue to build new homes, though at a much slower pace than in the past. The resale homes are in competition with the new homes for Buyers, so nobody is burning up the track. The economic slowdown has had an effect on every household in higher prices for groceries, utilities and most importantly, fuel prices. This diminishes the spending power of everyone - we tighten our belts and decrease our spending to stay within our budget as costs increase - and go to the restaurants less, only buy at the grocery store what we really need, try to consolidate our trips and avoid unnecessary driving around - and since we spend less, all of the other businesses we were supporting see a decrease in their income, and the cycle continues. They lay off employees, who then have to cut back on their spending. The meltdown in the mortgage market was, and continues to be the primary catalyst in the downward economic cycle. But there seems to be a bottom. One of the law firms I stay in touch with has noticed that even though the number of foreclosures is increasing through this summer, they are seeing a decrease as we head into the 3rd Quarter of this year. It looks like most of the "Teaser Rate" and "Adjustable Rate Mortgages" from 2005 have indexed upward (there are more out there, but there are fewer re-setting and causing problems at the moment) and those borrowers who can do it have re-financed into lower interest rate 30 year fixed mortgages or into longer term adjustable rate notes. So the volume of problem mortgages will become more manageable. What should happen now is that prices will stop falling, inventory should start to decline as Buyers realize the market has stabilized and is heading slowly upward, and the pent-up demand (people waiting for the bottom of the market) start to buy into the market before it rises too much. The same thing will happen to land parcels in Whispering Ranch. And my advice to Sellers is the same now as it has been for the past two years - "If you don't have to sell - DON'T. Just wait it out until prices start to rise." I know that it will happen; I just don't know when it will happen.
And I relate the same information to prospective Buyers. "You had better buy NOW instead of waiting for the bottom of the market and hopefully, lower prices. You won't know that the market has bottomed out until you look back and realize that prices have risen, and then you will have missed the boat."
The number of parcels on the market has slipped to under 170 properties on the market, prices of the parcels has dropped slightly. Sales are still few and far between,
but this will change as the economy recovers and consumers have more confidence. And the efforts toward getting power into the area, improving roadways and even
the possibility of incorporating the area into a Town all may be the "trigger" event that jumpstarts the area economy.
April 12, 2008 - The 1st Quarter '08 numbers are in and once again there is no good news to report. There were four transactions during the period, two of which were foreclosed parcels that M&I Bank had to get off their books. One of the properties I had listed over on the west side at $75K sold, and there was a sale at $55K for a property on 307th Ave south of Lone Mountain. We are still looking at 180+ properties on the market and no end in sight. I have been talking to a couple of the Lenders who had sold properties in the past couple of years, and they are getting properties back, so you may soon see a lot of these properties going back on the market, some as individual properties and others in groups of six or more. One of the interesting points is that these Owners are working toward completing the required Subdivision Public Reports so they will be able to sell individual parcels at higher prices and at the same time package six or more parcels together for bulk sales. I expect that these bulk sales will attract investor groups, but they should expect to have a four to six year hold as their strategy. When you add in these properties that are currently going through the Foreclosure or Deed in Lieu actions, we will probably see a marked increase in inventory available. Hopefully, these properties will be added slowly to the area inventory. If there is a large number of properties that come on line all at once, prices will drop - that's just simply how the laws supply and demand work. With the current inventory of parcels on the market, the stagnant economic market conditions, rising fuel and food prices, it is going to take a little time to work our way out of the current "recession" that our leaders are finally acknowledging. But when you add up all the factors - roadway planning, progress of planned area developments, water study completions, annexation activity by Wickenburg, Peoria and Surprise, and the agreements between the Bureau of Land Management and State Land Trust toward intelligent planning - the area has a bright future.
As we head into the elections this fall, I don't anticipate that we will see much movement toward getting a power grid started in Whispering Ranch. Most of the members of the Corporation Commission are nosing around to see what their political opportunities may be depending on which way the political winds blow, and any decisions made today would easily be overturned next January under a different political regime. But, I am still seeking information and awaiting notification from the Commissioner that they will be available to go out and tour the area. I hope to rally another wave of interest in this issue from Residents and Owners, but it looks like we may need more political horsepower to get and keep things in motion.
All we can do at this point is stay the course and continue to keep plodding along. If you look at the larger picture, though, we are way ahead of where we
were only five short years ago. At that time I had about 35 properties listed, and couldn't give them away at $12K. Now, I have about the same number of properties
listed and I can't give them away at $60K ! But that still is a five-fold increase in value - and they will sell at these prices in the future market. It's just a matter of waiting
until the current economic cycle runs its course.
February 9, 2008 - Despite the efforts of the Federal Reserve Board reducing interest rates to create more spending in our economy, this weeks report is that consumers are holding tight to their wallets and retail spending is down slightly. The stock market is down as well, and everyone is being pretty conservative in their investment spending. We are seeing a few more home buyers getting into the market. But there is still very little sales activity in the Whispering Ranch area.
Our efforts toward the goal of bringing power into the area are getting some attention from the Arizona Corporation Commission and Arizona Public Service, but the situation is one they have never faced before, and they don't know what direction to take to resolve the issue. But at least we are "on the docket" of issues they both will need to address in the foreseeable future. The newspaper article this Sunday in the Arizona Republic should help to bring more information on this issue into public view and demonstrate again to the government and power company that they need to deal with this issue sooner rather than later. The problems in the area at present are not going to go away and will be more difficult to deal with as time moves forward. I am glad that I dedicated the time to this project and wish there was more active support toward this goal, but we are moving forward with what we have. I had expected that Commissioner Mayes would take a tour through Whispering Ranch to get a better feel for what needs to be done, but that hasn't happened yet. Hopefully, it will happen in the next month or so.
In the next few weeks, the property tax bills for 2008 will be sent out, and though there is no way to determine exactly what the taxes will be, I am sure we will see significant increases. There will be a lot of people who may decide to sell their parcels, further flooding an already glutted market, and prices may fall even further with these properties coming on line. There will be another rush to apply for agricultural exemptions and there is the possibility that the County may not approve all of these exemptions. I have the contact information and forms needed to apply for this exemption through grazing leases if you need to know more. This is not an easy process, but if you are willing to do a little work, it just might pay off in reduced taxes for the future. Most folks I have talked to would accept a higher tax rate if they saw something tangible for the additional money they are paying - roadway grading and improvements or improved police and fire protection, for example. That might be a direction for the next 'grass roots movement'. Let's think about going to the County and making some requests for the additional monies we will be paying now that they have raised all of our property valuations.
When we add up all of the current issues - a stagnant economy, a jittery stock market, nervous consumers holding on to their cash, a glut of properties on the market, slow sales activity, rising taxes and no power improvements on the table at this point - the short term picture is not very bright. It appears we are not going to see any increases in activity for a few months, and, even then it will take a while to absorb all of the properties currently on the market. And with the higher tax bills going out, parcel prices may fall even further as more owners just throw up their hands and decide to sell. And I have been getting calls from folks who bought at the peak of the market who are not able to make their payments in this declining market. This is the normal real estate / investment / economic cycle running its course. Are we at the bottom of the market yet?? That remains to be seen. If there is more bad economic news or a continuing decline in the stock market things may just get worse. But this is a great time to buy in light of lower prices and great selection if you have the money.
Things will improve in time. Just hang on until we turn the corner. I don't know when that will happen, but it always does. I'll keep you posted on what I see as this goofy
January 12, 2008 - 2007 is now behind us, and despite my 'optimistic' hopes, this past Quarter was one of slowest in the four years I have been working in this market, with no reported sales. There were some private sales (principal to principal with no MLS agents involved) but these transactions apparently were by investors bottom fishing - generally taking advantage of uninformed Sellers who accepted far less than the actual property value. Or investors deeding parcels to other investors. Isn't Capitalism great?? Unless you're the Seller - I guess.
I have been showing properties to a number of prospects interested in the area, and they agree the area has gorgeous views and prices are good, but the biggest drawback is the lack of infrastructure - primarily electrical service. When you combine this disadvantage with the general Real Estate downturn, it became obvious that after years of being ignored, it was time to see what could be done to correct this problem, and hopefully plan for a brighter future. And, since the market is slow, I have taken on the task and become the point man in an effort to see what can be done to bring power into Whispering Ranch. Our earlier efforts with Arizona Public Service on a business level were met with lip service, so a decision to take another approach, from a political direction seemed to make sense. We began that effort last August. Over the next three months I delivered flyers to Whispering Ranch Residents, then sent out e-mails and mailings to all the remaining property owners. This appears to have had the desired result, as in December we were asked to meet with the Arizona Corporation Commission and representatives from Arizona Public Service to see what reasonable solution to this problem can be agreed upon. So we are now at that point. There is a long road ahead to solve this issue, but at least we are now on a path to some sort of solution. For those of you who have e-mailed or called or written letters, thank you for you help. And your help and support will be appreciated in these efforts in the future as well.
There are plans for freeways, highways, major arterial roadways, bridges, commuter rail service all over the West Valley area, so it is inevitable that power for Whispering Ranch should be a part of that planning. And all this effort will hopefully create added value for your property in the future. I have said since the 2006 slowdown that there will need to be a 'trigger event' to renew interest in the area, and it looks like a power grid in the foreseeable future may be just the event we need.
Once this issue is being addressed, the next efforts might be to see what additional services can be obtained from the County in return for their revenue increase from Whispering Ranch in the form of higher taxes. Maybe we can get an agreement for roadway improvements and maintenance. They might say no, but we should at least ask.
My optimism is somewhat tempered at this point, but I still see a lot of "upside potential" for the area. I know the market will turn and start back up, I just don't know when that will be. My best guess is probably the third or fourth Quarter of 2008. It may be sooner if the power issues are addressed quickly.
If you're thinking of buying, your best bet is to buy before the market turns upward. If you're thinking of selling, your best bet is to wait out these tough times, and sell when prices rise.
In the meantime, I'll be here to answer questions or provide you with updated information. Let's have a productive 2008 with an eye toward a brighter future for
Copyright 2004-2017, J. D. Liberty