River Cities Business Journal: Cover Story

River Cities Business Journal

BULLHEAD CITY - The housing market in the Bullhead City and Mohave Valley area may have bottomed out and be on track to grow, according to one local Realtor.

Even Fuchs, broker at Bullhead Laughlin Realty, sees signs that home sales are about to perk up.

“If we're not at the bottom we're in the neighborhood,” Fuchs said. “One thing we track very closely is the supply on the market. In mid-February we were sitting on 30 months of inventory, based on how fast houses were selling in the past 90 days. In mid-February there were 1,039 homes in Bullhead City and we were selling 30 a month.

“Last week (the first week of June) we were selling 50 a month so we're down to a 20-month supply. Days on the market have gone down too.”

A number of factors contribute the slowdown in the market in the regions, some of which are common nationally and some are localized.

A buying slump in Southern California is a major contributing factor here, but investor speculation, rapid appreciation and foreclosures have all played a role.

“The regions that are coping the best did not have great appreciation,” Fuchs said. “Those markets stayed pretty stable.”

Investor speculation and foreclosures went hand-in-hand.

“There was a buying frenzy. We had unsustainable appreciation,” Fuchs said.

And investors did not see an end to the skyrocketing values, but then the buyers disappeared leaving them with houses sitting empty.

“A lot became rentals. We have all these vacant houses so rental rates went down,” Fuchs said.

But, a lot of investor-owned houses went into foreclosure because the investors could not keep up with the payments when they weren't selling any houses.

“Of our current inventory 13 percent of the house for sale right now are foreclosures,” Fuchs said. “They're owned by the banks and they don't want to be in the real estate business, 37 percent of Bullhead City sales in the last 90 days have been foreclosures.”

There is another down side for those who bought houses while sales were booming.

“Now a lot of people find their house is not worth what they paid for it and they owe more than it is worth,” Fuchs said.

But, there is a bright side.

“There are a lot of quality homes out there,” Fuchs said. “If you're going to be a buyer right now there is a lot of choice and you can choose quality.”

It is too soon to say the slump is over, but it may be very close to over.

“The real estate market is self-correcting. The value is established by what people are willing to pay.

“You're not going to know you hit the bottom until it is behind you.”