The Phoenix Investor Boom, part 2 - A New Breed

Investors are definitely back, causing concern that the market is becoming speculative once again. The enticement of great deals for investors, which have been estimated to account for 50-70% of recent purchases, may be hindered by the ability to rent those homes to tenants.

Some long-time investors say they have started seeing a large number of naive, newbie investors with an attitude of sure-win that may have got us into trouble just a few short years back. Some investors are speculating, which could lead to an oversaturated rental market. Although the need for rental properties is still healthy, investors who are expecting huge returns could be in for a rude awakening, particularly if they don't put adequate time and effort into making the home the best it can be. Investing practice solid investment practices, speculators look for big return quickly with minimal effort, something that often will collapse on itself.

The vast foreclosure market has no doubt created the need for more rental properties.

Many investors are now purchasing with cash, lessening the chances of the home going into foreclosure again, and minimum down payments for financing properties are 20-25%, sometimes more. Investors will not be as likely to walk away from a property where so much of their own money is tied up.

Now investors and first-time buyers are clashing over some of the same properties. The competition that is causing frustration for buyers is also keeping prices from falling further, creating a double-edged sword. If there were only starter-home buyers are not investors the market would not have absorbed nearly the inventory as it has, creating what we are now seeing as a more stabilized marketplace.

Investors have fixed up and brought value to many valley homes where otherwise there may have been an abandoned property. Because of the investor presence neighborhoods are recovering.