Archive for June 6th, 2009
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6
Jun
2009
Best Choice Properties
For readers unfamiliar with the Phoenix area, let me give some background as to why the region was and continues to be so popular. The climate in Phoenix is spectacular and very easy to get used to. Apart from 10 or so weeks during the height of summer, when temperatures can stay above 100°F (around 40°C) for a few weeks on end, the weather is just perfect, with 350 sunny days a year and low humidity. The job market is stable and growing, with many high-tech firms having headquarters or major centers here, such as Motorola, IBM, Honeywell, and Rockwell. Google has just relocated from Silicon Valley to Phoenix. There are many call centers such as the one for US Airways, and a plethora of other employers.
For a long time now, some 6,000 people have been moving into the greater Phoenix area every month. This provides ongoing demand for anything from podiatrists, hairstylists, and coffee shops to all flavors of real estate.
For a number of years, we were actively engaged in a wide variety of real estate ventures. We had bought orange groves, subdivided them into residential developments, and even had some of the homes constructed. We were involved with commercial retail development in outlying suburbs. However, like anyone operating in this fast-growing market, we couldn’t fail to see what was happening with land prices.
We had seen speculators buy land for a few hundred dollars an acre, only to sell it a few months later for twice as much, or even five times as much. You can only observe that for a limited time before you develop the desire to give it a go yourself.
We knew that being successful with land development or speculation required more than just buying some dirt, sitting on it, and selling it at a profit. Despite the tremendous growth in the region, there were vast tracts of land that were not part of the general upsurge in values. So we pooled our collective knowledge, researched areas, studied population trends, met with companies that specialize in monitoring real estate trends, and looked at a lot of pieces of land. After conducting this research for what seemed like years, we were ready to make some moves.