As October comes to an end I’m seeing a real increase in the number of people buying foreclosed land and lots from both public and private lenders in the Tucson market. I’ve sold 4, improved  parcels this month and I know of the sale of at least 4 other Bank Owned vacant parcels by other agents. Many prognosticators wonder what it will take to turn around local real estate markets and I think this trend of heightened  foreclosure sales is certainly an important part of the answer. As we begin to lower the inventory of “below market ” properties, we make room for new and re-sale properties which are the lifeblood of a normal market.

Who are the people buying these assets? Two lots I sold in Oro Valley were  to an Investor from Pennsylvania who has been following the Tucson Land Market for quite some time. He bought for Investment with no intention to build. His plan is to hold these for 2-4 years until he believes the market will return and sell them for a profit. They had been selling in the high $200’s and he purchased them in the mid $100’s.  They’re good candidates for investment as there are no homeowners fees and have reasonably low real estate taxes. One lot, in a high end subdivision, also in Oro Valley, was previously purchased in 2006 for the mid $500’s and resold in the mid $200’s. This was purchased by a couple wanting to build a home in this gated, golf community and they wisely followed land opportunities until a very fine lot at a bargain price became available. (I just learned of a similar lot at a similar price about to be available in the same subdivision). The fourth lot was a beautiful, ridgetop, 3.3 acre parcel with big views in northeast Tucson that was offered for sale in 2007 in  the mid $500’s and just sold in the low $200’s. Again, this was a couple moving from Texas who had been searching for existing homes but were unable to find what they wanted. They couldn’t have afforded to build their dream home on a lot like this a couple of years ago but with current land prices, excellent seller financing and lowered building costs they could do it.

As I said, these represent just a few of the deals being made right now but it is very clear to me that those of us dealing in the foreclosure and REO Market are very busy. This afternoon, I’m showing 3 contiguous, 12- 14 acre parcels of horse property to a Broker representing a California buyer considering a Tucson move. Three months ago they were priced at $650,000, $550,000 and $550,000 respectively and today are $569,000, $399,000 and $399,000. Although not bank owned, they’re owned by a seller who knows he must remain very agressive to compete in this market. Today’s market is characterized by an  oversupply of lots where  careful buying will produce terrific opportunities and future returns.

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