TheTucsonFoothills

Condos

I don’t do condos and normally I don’t report on them either. But I saw this piece on CnnMoney.com and couldn’t resist.

Read all about it>

Condos for less than the cost of a Corolla

Seriously. It talks about condos for sale in Florida and Vegas that are now going for $25 to $30,000. That’s for a 1 bedroom condo. During the boom, condos were quickly and massively overdeveloped in these areas, thus the precipitous fall in prices.

Here in the Foothills there was similar rush to develop condos in, I think it was, 2004 – 05. But instead of building them, because there was no land to build on, condo developers just converted rental apartments to condos – with the added benefit of, presto, instant condos.

But they all did it at the same time. And suddenly new condos were sprouting up at Veranda, at Pinnacle Canyon and at other newly minted condo communities within three to six months of each other. So, overnight, we went from a meager supply to a huge glut.

In the period of April thru July 2006, Tucson Foothills condos sold for an average of $223,440/$203,450 median. With the lowest price going for $126,900.

In the same period this year they went for an average of
$145,000/$134,000 median. A 35% drop in average and down 34% for the median. With the bottom of the barrel selling for $55k, $61K & $83k. And with 25% of this years sales as foreclosures or short sales.

Currently there are 155 condos for sale in the Foothills, average list price $157,684/$159,000 median. With the lowest price at $75,000
for a 1 bed/1 bath/701 sf unit at Veranda.

Condo anyone!

they're still hanging tough at Villa Milano

I don't know if anyone's paying attention at Villa Milano at Rancho Sin Vacas, but the only two homes that have sold in there in the last six months, sold for $227 and $221/sf. And that was well before our latest financial woes took root.

Yet inexplicably, the 20 homes that are still for sale in Villa Milano are listed for an average of $322.79/sf. The high is $384/sf, and 15 of the 20 are above $300/sf.

And most of these homes have been on the market for more than 500 days, some for 600, 700 and more days. Hello! Anybody home
See them here> Villa Milano (link will expire on 12/28/08)

And Villa Milano's very nice. It's in a great Foothills location, in gated Sin Vacas, far from the maddening crowd. And the homes are nicely designed and built. But for some reason (price maybe?) it ain't working.

Worse yet, a year ago I wrote about Villa Milano,
villa milano at rancho sin vacas,
with basically the same story to tell. So this is now getting boring, even for me, so let's hope something changes by next year.

see my web site thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes

builders in trouble

In the News and Alerts section of it's web site, The Arizona Department of Real Estate lists Arizona home builders, along with the developments they are currently involved in, who are in financial trouble. list of known builders

Of the 44 developments listed, there are 5 in the Tucson metro area, with RiverWalk the only one located in the Tucson Foothills.
The developer/builder of RiverWalk is River Elks, LLC.

RiverWalk is the luxury townhome development that sits adjacent to the Rillito River just east of Campbell Ave. The ADRE site does not provide details as to the extent of 'financial trouble' the builders are in, but does provide an advisory for home buyers,
Commissioner’s Advisory No. 2 Guidance for Homebuyers

Last year I wrote about RiverWalk, and said it was a bold and interesting concept that I thought would be very successful -
New concept for the Tucson Foothills. And while I still think it's a bold and interesting concept, and I hope they're able to work through their troubles, the collapse of the credit markets about a month after I wrote that piece put this and many other projects in jeopardy.

According to the site plan there are 140 units built or planned for in RiverWalk. But because RiverWalk has an on-site sales office and does not put all sales through the MLS I can't tell how many units have sold in there.

When I wrote that piece last year, the on-site agent told me that all 40 units in phase one had SOLD OUT. But I didn't take take that to mean SOLD, as in closed escrow. What she was probably (not) saying was that only some of those 40 units had actually SOLD, and the remainder just had deposits on them. And then when the credit markets collapsed a month later, I'm sure it took many of those buyers with deposits, right out of the market.

In any case, the MLS shows just 12 sales last year ranging in price from $432,569 to $735,000, and no sales this year and nothing listed for sale. And the tax records are no help either, listing just 7 sales in RiverWalk. There's gotta be more than that. Doesn't there? I'll look and see what else I can come up with.

see my web site thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes

condo prices in the Tucson Foothills, then and now

There are a lot more condos in the Tucson Foothills these days than there were just a few years ago. And these days they're selling for just about what they were selling for a few years ago too.

That's because condos in the Tucson Foothills have been
over-developed and over-speculated. In a very short time we went from a real shortage of condos in the Foothills to a very hefty supply.
And while hundreds and hundreds of those new condos have been sold, and most of the over-supply has now been absorbed, prices for condos got hit pretty hard to make that happen. 

I was showing condos this week to some out-of-town buyers and pulled up the sales data on a few different condo developments to give them an idea of what's been happening with sales and prices over the years. And with condos it's really easy to compare sales and prices because condos are so similar to each other - the ultimate cookie-cutter property - particularly within the same development.

I'm going to use Canyonview@Ventana condos as an example because it converted to condo back in 2003, well before the most recent conversion craze, and because of that it allows us to look at sales over a longer time period. So here's what's happened to sales and prices at Canyonview condos over the past five years.

Jan - June 2008, 8 sold for an average sale price of $169,000, or, $185/sq. ft. 

Jan - June 2007, 11 sold for an average sale price of $210,227, or,  $192/sq. ft.

Jan - June 2006, 14 sold for an average sale price of $250,786, or, $234/sq. ft.

Jan - June 2005, 17 sold for an average sale price of $194,588, or, $188/sq. ft.

Jan - June 2004, 24 sold for an average sale price of $150,133, or, $154/sq. ft. 

So right now prices at Canyonview are somewhere between where they were in 2004 and 2005, and sales are slower today than back then. Some of this may have to do with the overall fallout of real estate in general, but the real culprit is the hundreds of new condos that came on-line from mid 2005 through mid 2006 creating an absurd over-supply.

And in the most recent conversion, Skyline Villas, located right behind La Encantada, there's a big difference between just last years prices
(avg sale price $203,886 or $216/sq ft.) & this years
(avg sale price $165,455 or $179/sq. ft.) A big difference.
Skyline Villas has just now sold out, and it sold very quickly given the eroding market conditions, and competition from a slew of other condos for sale across the Foothills. But they did it by cutting prices until all the units sold, undercutting the competition.
Unfortunately, those who bought last year are likely in for a long wait before prices rebound.

see my web site thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes

it's a condo, it's a town home, it's a ...

Bob, a reader of this blog emailed me asking how the town-home market is doing in the Tucson Foothills . 
This was in response to my post in the Tucson Foothills real estate market ... where I was asked readers to let me know, what they'd like to know about the Tucson Foothills market.

Ok, the town-home market. For single family homes this is usually a simple and straightforward task, and I do it regularly. But for
town-homes I knew that it wouldn't be quite as straightforward, and would involve a bit more sifting through the data.

Here's why.
Until early 2007 town-homes and condos were treated as the same type of property in the MLS, TH/CND, townhome/condo.
When an agent listed either a town-home or a condo, there was one box to check on the MLS listing sheet and that covered both
town-homes and condos, and as a result listings for town-homes or condos showed up as TH/CND. No distinction. They were all glommed together.
Then in early 2007 the Tucson Association of Realtors decided to
un-glom them and create two separate categories - Condo, and town-home, each to have their own separate designation. That makes sense.

And then, as a follow up, I'm told, they somehow would go back and
re-designate all the properties that had sold and were originally listed as TH/CND into the newly appropriate separate categories.
Condos were to be re-listed as condos, and town-homes as town-homes. Neat as you please. Or so the story went.
 
I don't track condo/town-home sales like I do single family homes, so I wasn't aware of the extent of this condo/town-home mash-up,
and assumed that the TAR had more or less straightened things out, so I could move ahead and answer Bobs question.

So I started pulling the data from the MLS;

I saw that in 2003, 326 town-homes sold in the Tucson Foothills.
That seemed like a very healthy figure for town-home sales in one year.
Moving on I saw that in 2004 272 sold, but in 2005, 429 sold.
How could that be, 429 town-homes sold in one year in the Foothills.  Up periscope, I started wondering, did I sleep through some game changing town-home event that occurred in 2005, or am I just losing it
OK, let's see what happened in 2006.
IMPOSSIBLE. DID NOT HAPPEN.
-according to the Tucson Association of Realtors MLS -
655 town-homes SOLD in the Tucson Foothills in 2006,
NO WAY! There's never been near that many town-homes for sale in the foothills in any one year, never mind 655 sold,

Now I had to find out what was going on and take a look at the details of where these alleged town-homes were located.
It took about a minute and it all fell into place.

In 2005 & 2006 there was a tsunami of condo conversions that took place in the Foothills - Tierra Catalina, Veranda, Pinnacle, the Villas at Sabino Canyon, Ventana Vista, etc, etc. And those condos were originally listed as TH/CND, townhome/condo. But later, when the MLS decided to separate the two categories, almost all the condos somehow got re-listed as townhomes. And because of that, the hundreds of condos that have sold since then, ended up being listed as town-homes that sold. Not condos. Hundreds of them.

So all the data on town-home sales is corrupted and useless, and all the data on condo sales is useless too.
The MLS data shows that 655 town-homes and 62 condos sold in 2006. Flipping those numbers - to 62 townhomes & 655 condos sold -though not completely accurate, would be a lot closer to the actual number of condos and town-homes that sold in 2006.

So in trying to answer a simple question from Bob, " how's the
town-home market doing in the Tucson foothills " I've instead opened a big can of worms.

So Bob, for now, it's hard to say how the town-home market is doing.

At this point, in order to figure it out, me, or anyone else, would have to go through each listing, one-by-one, in each of the last few years to determine whether each property is actually a condo or a town-home, and then separate them out, keep a list, check it twice, and add up the number of properties sold that are actually town-homes, plus the sold price for each, and then compute the average and median sold prices. Sound like fun yet.
If I only went back to 2005 it would mean going through about 1300 listings, one-by-one. Quick, where's my abacus.

Needless to say, I've got a few calls into the Tucson Association of Realtors MLS, hoping that they will figure out a way to untangle this mess. I'll let you know what I hear. 

see my web site thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes

the villas at Sabino Canyon

As I mentioned the other day in, the condo sizzle fizzles 40 condo units are to be auctioned at The Villas at Sabino Canyon on May 10.
There are two 2/bedroom and one 3/bedroom floor plan, ranging in size from 1004 to 1209 sf, and three Starting Bid prices of, $89,000, $99,000 and $109,000, depending on size, location and views.

The brochure says to go to http://www.auctiontoday.com/ for additional photos and information, but as yet, there's no information there on the The Villas auction.
Until it becomes available on the web site you'll have to stop by
The Villas to get all the details, they do have a brochure, or call the auction office at, 1-888-582-7332

The Villas at Sabino Canyon - 7255 E Snyder Rd, northeast corner of Snyder & Kolb

As usual with these auctions, there's lots of fine print about the steps and procedures, terms and conditions, your rights and responsibilities, due diligence, bidding requirements, etc. Read it all carefully.

see my web site thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes

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the condo sizzle fizzles

I don't have all the details yet, but word is that 40 condo units at The Villas at Sabino Canyon here in the Tucson Foothills are going to auction on May 10.

I don't know if these are all the same units, but when they were listed for sale in the MLS recently, they ranged from 1004 to 1209 sf,
2 to 3 bedrooms and 2 baths, and were listed from $169,900 to $220,000.
And according to the MLS, 36 others have sold in there over the last year or so, from $155,000 to $255,000. These owners are not going to be happy.  Unconfirmed information tells me that bidding will start at $89,000 or $99,000 depending on the unit, and there is an undisclosed reserve price that must be met.

But you could see this coming from a long way off.
The condo craze got started here in 2005 with the zippity-quick 6 hour sale of all the units at Tierra Catalina, the first new condo development to open in some years in the Foothills.

Soon word got out that there was fast money to be made in Tucson, and out of town developers quickly bought up all the apartment complexes in the Tucson Foothills, and waved their wands and turned them into condos. But they all did it at about the same time, and in the blink of an eye we went from 40 or 50 condos for sale at any one time, to more than 1000 and growing.  OOPS!

The Villas at Sabino Canyon were one of the last to open their doors, and by that time, the market for condos in the Tucson Foothills was suffering from a severely bloated supply amidst trickling demand.

I'll post the auction details when I get them tomorrow.

see my web site thefoothillsToday.com
to search for and learn more about Tucson Foothills Homes

villa milano at rancho sin vacas

Have you ever heard of Villa Milano at Rancho Sin Vacas -
the 'ranch without cows'
Apparently not too many people have. And that's too bad.

It's a newer community of single family homes and townhomes built during the last couple of years in the Tucson Foothills.
Recently I had occasion to be up there looking at some of the homes for sale. I was very impressed, they're very well done.
Located within Sin Vacas, an established guard-gated community high in the Tucson Foothills, the homes are new or newer, they were built in the last two years, they're very attractive - with good floorplans,
high quality materials and finishes - and they appear to be very
well-built. And the streets have charming names,
Via Corta Dei Fiori (way of the flowers)
Viale Di Buona Fortuna (tree lined avenue of good fortune)
But despite all that, sales have been slow.
There are 72 home sites in Villa Milano, and 24 homes are currently listed for sale through the Tucson Association of Realtors MLS - Of those 24 for sale, they are about evenly split between completed homes, some of which are re-sales, and homes that are yet to be built being offered by the builder. And yes, it appears that some of the resale homes were originally bought by investors.
This subdivision, which was announced during the peak of the boom seems to be having a difficult time getting off the ground now that real estate has cooled.
And that's certainly a concern and worth further investigation.
But if you're looking at the patio homes or golf villas in La Paloma or Ventana, or even larger homes in a guard-gated Foothills community, and you don't need to be next to a golf course, you might want to consider Villa Milano.
In my opinion, the homes in Villa Milano are nicer than what is generally available in those country club communities, and they're newer, and given that there are quite a few for sale, there may be an opportunity to make a good deal.
The 24 homes for sale in Villa Milano are list priced from $475K to $860K, and they range from 1840 sf to about 2740 sf.
Click Villa Milano at Rancho Sin Vacas to see all the homes for sale.
Buona Fortuna!

the growing condo market in the Tucson foothills

Unlike the market for single family homes, the condominium market here in the Tucson Foothills has been expanding by leaps and bounds. As I've often said, land for building single family homes is very scarce in the Foothills, one lot here, another one there, but no large parcels available for development. Condo developers on the other hand, have been having a free-for-all converting rental apartments to condos in the Tucson Foothills during the last few years.
Things started to heat up in the spring of 2005 when Tierra Catalina announced that it was converting from rental apartments to condos. Well you’d a thought they were giving these things away. Hundreds of people spent the night camping out on the street to be able to put down a deposit on one or more of the 250 condo units available in there. They sold out in 4 hours.
That kind of news travels fast, and it wasn't long before developers from far and wide got a whiff of that action, and the condo market here went wild, with new conversions popping up all over the Foothills.
Ventana Vista, Greens at Ventana Canyon, Veranda at Ventana, Reflections in the Catalina Condos, Foothills Professional Plaza (aka Tierra Catalina), Pinnacle Ridge (aka Pinnacle Canyon), Villas at Hacienda Del Sol, Villas at Sabino Canyon, Skyline Villas - these are all condo developments in the Foothills that have been converted from rental apartments in just the last three years.
Before the boom there were just a handful of condo developments in the Foothills, and admittedly, condo choices were very limited. Now they seem almost limitless.
The Tucson Association of Realtors MLS shows 163 condos for sale in the Foothills. But there are more than that. The way it works is that the newer condo conversions don't necessarily list every single unit that is for sale in the MLS.
Instead they'll list one or two units of each floor plan, like model units. So you pick your floor plan, where you want to be in the complex and your upgrades, etc, and that determines the unit and the price. So it's hard to say how many are really for sale.
But with all those conversions coming on the heels of each other, there was, and maybe there still is, a glut of condos on the market. But they are selling. The MLS shows that 137 have sold in the last six months, and 22 more are currently under contract, that's 159.
And just like the newer conversions don’t list every single unit that is for sale in the MLS, they also don’t report every single closed sale in the MLS. So there are more than 137 that have sold.
But using those numbers, because that's all we have, with 163 for sale and 159 sold or under contract, we're at a six month supply.
And according to my friend and fellow Realtor®, Walter Klein,
aka the condo man, a couple of things are happening right now in the Foothills condo market that can tilt the outcome either way.
- this is the beginning of the prime season for condo sales, and there are lots of lookers, as snowbirds continue to arrive in the Catalina Foothills for their yearly visit. As yet though, this has not translated into a surge of sales.
-inventory is up, prices are down and sellers are more flexible than ever, to the extent that you can buy a condo for less today than at the height of the frenzy a couple of years ago.
-and while buyers today are much more likely to be people who are buying them for their own use, as primary or second homes, vs. the investment craze of the past, in a somewhat surprising development, some people who already own a Foothills condo, are buying a second, and usually larger unit, because prices seem so attractive now.
We'll look back at this market in a couple of months, and by then we should have a good idea which way the winds blowing.

the Foothills lifestyle

For a long time now I've said    '...the Foothills is pretty much built out, so that what you see is what will be, with few exceptions',
But now I find that I've got to back-pedal on that statement a bit.
On June 14th I wrote Last Big Development which talked about the 54 new homes that A.F.Sterling was building in the Foothills along Sunrise Dr by La Paloma, along with new commercial/retail space.
Then in New Concept for the Tucson Foothills I wrote about RiverWalk, a new development of 120 homes, plus restaurants and shops, that offer a style of housing and lifestyle that has not been available in the Foothills, 'til now. 
When I made the' pretty much built out' statement, I was thinking -traditional Foothills residential - an acre lot for one single family home. There are very few of those lots available.
But the developers, builders and investors, have found a way to utilize land that doesn't fit with that traditional concept of Foothills living, and in doing so, to broaden that concept and introduce new types of housing and lifestyle choices.
I never thought I'd be saying this, because I'm crazy about the traditional Foothills style of living, it's why I moved here, but I welcome these new concepts, and think they'll be very good for the Foothills. They're going to introduce the Foothills to people who are not interested in the traditional Foothills lifestyle, and probably wouldn't have considered living here, 'til now.
I think this all started -though maybe that wasn't the intention- with the explosion of new condos that have become available in the last couple of years in the Foothills. The new condos have made low maintenance, moderately priced housing in an upscale area, available to a lot more people.
You can buy a one bedroom condo in the Foothills in a great area for around $150K. While you could do the same thing a few years ago, there was a very limited supply of condos in the Tucson Foothills and they were mostly bought, sold and inhabited by second home-owner winter visitors. Today, with many more condos available in the Foothills, I see a lot of younger people interested in buying a condo as their primary residence in the Tucson Foothills.
Riverwalk, and to a lesser extent the A.F Sterling homes in Paloma Ridge, have begun to turn the definition of Tucson Foothills living on it's head. And that's a good thing, because it will add a new dimension to what it means to live in the Foothills, and in doing so broaden the appeal of the Tucson Foothills and help to diversify the population.