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Lending / The Ticker

Phoenix housing market hit by unprecedented plunge in demand

Goodbye cash buyers

Phoenix
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ZeroHedge is taking aim at plunging home values in Phoenix. Is the blog kicking the on-again, off-again housing market while it's down?

No. There is a reason Phoenix is special selected for unique scrutiny, the blog explains:

"The Phoenix housing market has a special place in the heart of housing bubble watchers: together with Las Vegas and various California MSAs, this is the place where the last housing bubble was born and subsequently died a gruesome death which nearly brought down the entire financial system."

Here's what's going wrong today, in a nutshell:

Cash purchases have been running at an unusually high level but this has been on a declining trend over the past year. In Maricopa County the percentage of properties recording an Affidavit of Value and purchased without financing was 25.0% in May 2014, significantly down from 32.3% in May 2013. We consider 7% to 12% the normal range for cash buyers, so mortgage-lending still has a long way to go to get back its normal share of the market.

Source: ZeroHedge
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