PHOENIX LONG TERM OUTLOOK

Phoenix has a lot of positives going for it. We do not have extreme weather other than a little heat in the summer. No earth quakes, no tornadoes. Our climate is ideal to attract people, both older and younger.

In addition our location is great, only a few hours to Los Angeles, Las Vegas, The beaches of Mexico and 2 hours north you can go skiing. Phoenix also had one other major component that attracted people to relocate to the valley - Affordable Housing.

THAT is our current problem, our housing costs increased to levels that were not sustainable in the long run. The valley attracts a lot of employers, however we do not attract enough employers that offer high salary jobs. Prices needs to stay in line with salaries, for it to be sustainable.

We have been seeing a decline in population increase over the past few years, in my opinion mostly due to rising housing costs. We do however still have 160,000 people relocate here every year. We are one of the fastest growing states in the country and will continue to be. Once housing costs return to more sustainable levels, we will see another rise in the population increase.

With so many positives to our valley, I do strongly believe that the turnaround in the valley will be a much quicker process than in many other parts of the country. But we won't see a turnaround until people can afford our housing. Long term, I see strong growth and a massive population increase. The biggest question, even bigger than when the housing market will turn would be water. But that is a whole other issue.

SELLING LOW, OUCH

Trust me, no one wants to sell low. Why would we? For many of us, the equity in our house is all we have. However, the equity we think we have, might not necessarily be there anymore. I know it's harsh, but just because we at one point thought we had a certain amount of equity, the true equity in our house is what the market says it is. A house is only worth what a buyer is willing to pay, weather that is more or less than what we think the house is worth. Many homeowners are attached to their home, and most of us think that our house is worth more than our neighbors house because __________ (insert reason here).

To be able to see the REAL value of your home, you need to look at your home as a business transaction, rather than an emotional transaction. Look at it from the buyers standpoint. If you go to buy something, don't we all want a bargain? Would you pay more for a car than what the competitors offer it at? Chances are your answer is no.

Right now, it is really is a gamble. People have always predicted the future, and sometimes they are right, sometimes they are wrong. The truth is, the majority did not. If we did, we would not have been in the current situation. The outlook for the market is constantly being adjusted, why? Because it is impossible to tell for sure. All we can base our educated guesses on are current market trends, and what we know is coming. The current short term outlook does not look good. So the gamble of selling low at the current time might very well turn out to be in your favor 6 months down the road. Bottom line is, it is more to life than money, things happen that we have no control over. One thing is for sure, we only live once, so try to make the best of it!