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Housing Panic Comes to Wickenburg!

Many in America right now would not deny that the housing market has taken a sharp turn from the glory days in 2002-2005. Looking back at the rapid inflation of home prices in such a short period of time, it’s not rocket science to see that this price jump was not based on solid financial fundamentals, but rather by a false sense of demand, low interest rates, toxic mortgage plans, and willing lenders giving loans to risky customers.

Many of you are asking now, well what does this have to do with Wickenburg and my home? The answer is not for the faint of heart!

According to ZipRealty, the number of homes on sale in the Wickenburg market now stands at 351. This is the largest number of homes that have been on the market in the two years I have been tracking it. There is much more supply than currently meets demand.

The psychotic part of all this is that developers are currently building more homes and adding inventory to the already saturated housing market in Wickenburg. New housing projects such as Wickenburg Ranch and Hermosa Ranch are forging ahead with projects because if the developers do not develop, well it’s off to find a new line of work. The safety problems inherent with the Hermosa Ranch project alone (due to the proximity to the airport’s runway) would be enough for a normal person to delay or cancel the project.

It just does not make good financial sense to build a product when no one wants it. Whether this will be the case in 10-15 years, no one can tell. But right now there is just not a need for the new inventory.

The reason people are drawn to Wickenburg is because of the vast open space, desert views and the gorgeous sunsets at night. Wickenburg should not be turned into another Chandler or Surprise due to shortsightedness.

17 comments to Housing Panic Comes to Wickenburg!

  • Allan Hall

    Dan:
    What makes the situation seem even crazier is that these developments are forging ahead in a market that has inadequate local employment opportunities. Assuming that three out of every four houses will be sold to working families, this means they will all be commuting to metro-Phoenix. That is the nightmare that Maria spoke of in her article.

  • Daryl

    Perhaps the plan is to sell to retiring baby boomers, the pig in the python is coming. It wouldn’t surprise me to see Wickenburg at 25k pop. by 2025.

  • Jim Ferman

    This was an excellently written article, Dan. You made a lot of sense and see things as they are. Unfortunately in Wickenburg we have a town whose citizens don’t want to get involved. Until something is plopped down in a citizen’s front yard, there is generally no response.
    I ran for Town Council a couple of years ago because I was tired of the apathy and because I was very concerned with the direction our town was headed.
    In our town now we are represented by a Town Council and Planning and Zoning Commission which has members seated who are realtors and mortgage brokers. Our Chamber of Commerce is very supportive of these particularcouncil members and are very supportive of any new housing developments. All one has to do is to go to their website (www.wickenburgchamber.com) to see who makes up their list of leadership. One current council member is the Chamber Tresurer and the another is on the Board of Directors. Our mayor is the Ex-officio Director of the Chamber.
    During the last election there were two citizens running for the council who readily accepted donations (check their campaign finance reports) from local developers. It’s interesting to note that none of the zoning change requests or development plans they have requested have been defeated since that time. One candidate was elected and the other defeated, but then was later appointed by the mayor to sit on the Planning and Zoning Commission.
    It is also interesting to note that I pushed for the town to investigate and potentially adopt an Ethics policy in order to establish rules to avoid conflicts of interest. Ofcourse that issue was rapidly hushed and turned down.
    Even our local newpaper has been very supportive of any and all developer’s requests and have supported the Chamber’s representatives on the council and P&Z Commission. Does it surprise you, Dan, to find out that the newspaper’s publisher is on the Chamber’s Board of Directors?
    So, you see what we face here in our town. It isn’t about what is good and carefully thought out for our town. It all boils down to the almighty dollar and uncontrolled population growth and increased roof count which these folks think will favorably help our town. There is nothing taking place which includes careful planning and forethought.
    If you are up on local issues, you’ll note that our town wants to annex an area of land larger than current Phoenix. Annexation has it’s merits, but not if you are a town which doesn’t have the infrastructure in place to support this growth.
    Get involved, Dan, and see for yourself just what we have in place in Wickenburg that is rapidly going to spell the downfall of our wide open spaces and easy to breathe supply of air. I pray you have the moral integrity and backbone to stand up to it.

  • Allan Hall

    Dan:
    Can you provide an educated estimate that will help us understand how much of supply these 351 homes currently represent? Is this a six month supply or longer? Also, if you combine all local area developments, what is the aggregate planned buildout of additional new homes?
    Thanks, your article provided a sobering insight.
    Allan

  • Allan Hall

    Dan:
    A friend of mine in the real estate business told me today that Wickenburg sells an average of 150 new and resale homes per year; so the current inventory represents roughly a twenty-eight month supply. With new developments already underway, the inventory is bound to increase.

  • Dan Schwimmer

    Allan,

    The main goal of the article was to bring awareness of how irresponsible development can have dire consequences on the economic health of small communities. Wickenburg will need public infrastructure, schools, jobs, and an overall healthy economy to absorb the new housing that enters the market. There is just too much uncertainty and risk to allow this into the current market!

  • Daryl

    Did you look at those “homes” Zip includes? Looking at a few of the pages, it appears many of the listings are lots or acreage.

    Makes this article’s headline seem a bit sensational, if not alarmist.

  • […] Housing Supply: Dan Schwimmer reported in his article (Housing Panic Comes to Wickenburg!) there were 351 homes for sale in the Wickenburg market at the end of October, 2007. Although this is orders of magnitude smaller than metro-Phoenix (where there are more than 55,000 houses for sale) we are still affected by the same market forces. A friend in the real estate business told me that Wickenburg sells an average of 150 new and resale homes per year; so the current inventory represents roughly a twenty-eight month supply. Unmanaged growth in inventory (new construction) could serve to depress current home values in the community. I am distrustful that local developers are willing to exercise self restraint and refrain from enlarging our already bloated supply of housing. […]

  • Duane C

    I counted the actual number of homes listed on Zip, and there is only 96 homes. The rest of the listings are acreage for sale. You guys need to get your facts straight before making any assessments. This is not professional journalism.

  • Dan Schwimmer

    Duane,

    You are correct, it is not profesional journalism since no one here is getting paid for what they write. The main point of the article was to see how a oversupply of homes can have a negative effect on the local economy, and how it would make little sense to add housing inventory to a already oversaturated market. Are you a realtor by profession?

  • Daryl

    Dan,

    Any point you may have attempted to make was completely obscured by your shoddy research and misrpresentation of Zip’s figures.

    A perusal of the facts would seem to indicate that Wickenburg has a current HOME inventory of about 8 months.

    BTW, I am not a realtor nor actively involved in the real estate industry.

  • Onie H

    I live in another state and when I visited Wickenburg about a week and half ago, I fell in love with the community. It’s small yet very clean, it offers all the necessities of life for the average person, however I would not be working at the local mini mart. I would be investing in a business and then a moderately nice home. I currently live in a small town and for most people like me, we are attracted to humble beginnings with big town appeal and the hope of prosperity. Any suggestions as to what type of business Wickenburg would need and want? Open to suggestions. We considered buying the old JR motel and remodeling it, but we are very open to suggestions.

  • Allan Hall

    Hello Onie:
    I am by no means an authority on the question you have asked, but I will offer a couple of suggestions based upon my own shopping trips into Phoenix or Prescott for items that are not locally available (or that are over-priced) in Wickenburg.

    1. There are not enough “regular” clothing stores
    2. There are no stores dedicated to arts, crafts or hobbies
    3. There are no sporting goods stores
    4. General office supplies are limited and over-priced
    5. There is only one book store
    6. There is a limited availability of consumer electronics

    These, and probably a host of other ideas would offer anyone an opportunity to provide services to Wickenburg and nearby towns that would be valued. I imagine other readers could weigh in with their suggestions as well.

    Best wishes to you!

  • I see things are getting a bit out of hand in the comments here.

    First, I’d like to say that what Dan says is true: no one is being paid to write for this site. As the site’s Webmaster, I greatly appreciate ANY content contributed for others to read. But I doubt whether my appreciation is enough to compensate authors for the time they spend writing here.

    If I were in Dan’s shoes, receiving abuse from commenters after putting time and effort into writing an informative opinion piece about the state of real estate in Wickenburg, I’d be unlikely to write another article for the site. And if everyone started feeling like that, we wouldn’t have any new content here.

    I need to remind everyone that the articles and opinions shared here are shared for the purpose of getting information out and discussions going. Dan’s article is one of the most commented on the site and has gotten a discussion going. Personal attacks from either side will not be tolerated on this or any other post in the future.

    I now see and manually approve every comment that goes through this site. If I feel that a comment unfairly and rudely blasts an author or another commenter, that comment will be deleted. I will not have fighting on this site. I hope that’s understood by all concerned.

  • Now that I’ve finished scolding, I’d like to add my own answer to Onie’s question.

    I agree with everything Alan says. I think an arts/hobbies shop that appealed to women and families would be an excellent addition, since there are so many retirees and a lot of them like hobbies to keep busy.

    I think a clothing store with reasonably priced, relatively good quality clothing might do okay here. Wickenburg has the very low end covered with Alco and the very high end covered with Double D and Suzanne’s. It’s the mid-range basics we need.

    I wish there was a good bookstore, but I can honestly say I’d probably continue buying from Amazon.com even if we had a decent bookstore in town, mostly because the prices are better than most stores. Ditto for office supplies, which I order through Staples.

    The sad part about Wickenburg’s retail situation is that those of us who have needs and can’t spend time driving down to Surprise have learned to buy online. Other than groceries and fuel, I’d say 75% of my purchases are made via the Internet: books, music, office supplies, pet supplies, computer equipment, electronics — the list goes on and on. If I can’t get it in town, I buy it online and have it shipped to me. The main exception is clothing: I generally don’t buy that online.

    I do, however, buy whatever I can in town — unless the price is outrageous (which it sometimes is) or the quality is crap (think Alco, Dollar Store, etc.). I like to support local businesses — when I can.

    I think the key to having a successful business here is treating customers like they’re important. I’m far more likely to buy in a stop where people remember me or give me a friendly smile when I come in than one that shuts the door in my face if I arrive at closing time. (And yes, that has happened in town — to my husband — and he won’t go to that particular store again. He’s in Phoenix every day for work, so he does a lot of shopping/buying when he’s down there.)

  • pipelineaudio

    I left a decent living in Kailua, Hawai’i about 15 years ago in large part because I loved Arizona so much. The land, the wildlife, the people, the incredibly wide open spaces (when you are on a tiny rock for most of your life, not seeing the ocean every time you come over a hill is an amazing experience).

    Due to pursuits I had, my hours and finances kept me from seeing much of the land, and by the time I had enough time to even the areas around my home in Phoenix, it had become a parking lot. No matter how hard people tried to preserve a bit of the nature, the developers just glassed entire areas and killed everything they found, with bleach gravel and fake grass lawns, and those awful, awful miles of walls spelling the coup de gras.

    Now in a probably temporary change in fortune, I get to stay in Wickenburg for a while. You may have seen me in my beat up old slippers, taking pictures of snakes, riding my bike around Constellation Park, driving my toyota corolla and getting stuck in rocks where only 4×4’s should tread or running around at the rest stop on the Hassayampa chasing birds around with a microphone and a laptop. I LOVE it here! Not just the land, but the people. Its a great place to be and full of stereotype shattering characters as well as living icons.

    I used to feel the same way about Cave Creek. Took a while to drive out from Phoenix, but man! It was worth it. Nowdays its stoplights all the way there, and the same walled in, stucco wasteland that you could find just as easily anywhere in the middle of the valley cities.

    When I see the giant scars where the developers are glassing hundreds of acres I worry this will be the next Anthem or whatever the newest “drive 50 miles, but end up in the same %#*& place you were, stucco, lifeless, grasslawned imitation midwestern town.

    Please don’t let Wickenburg become just another suburb parking lot of Phoenix.

  • Donna

    I live in Phoenix and visit a good friend in Wickenburg every other weekend. It is a beautiful place, but what I’ve noticed is a need for some really good restaurants. We go to the Bar 7 which has a nice atmosphere, and there’s a coffee shop on the main drag (can’t remember the name) that has good salads, but I keep thinking that some good restaurants would bring in revenue from both full-year and part-year residents.

    As a side note, thank you for putting together such an informational site, I am considering moving to Wickenburg in the next couple of years, and this site allows me to learn more about the town in the interim.

    Donna