Location, Location, Location

We have been living in the northwest Phoenix area of Peoria for seven years. Work, school, and church are all within ten minutes of our current home. We wanted to find a piece of land in the same area. Because this area has been developed for a number of years, this was going to be difficult. Only three small sections still had lots for sale. Near 67th Avenue and Happy Valley the prices remained over the top at 200,000 dollars an acre. 67th Avenue and Union Hills had just 2 or 3 lots for around 100,000 dollars, but the homes around it were build in the 1970s. Both of these areas were excluded from our search. The only location left was near 83rd Avenue and Deer Valley. Lots of open lots remained but mostly in neighborhoods already established with gigantic homes or located on main streets.

As I noted in a previous blog, my uncle informed me of a neighborhood to explore. In August of 2010 I found the neighborhood of four lots behind a gate with three beautiful custom homes already built. Everything in the neighborhood was for sale including the fourth and final lot. It was the corner back lot, exactly what we wanted. The gate did not really concern my wife and me; not a deal breaker either way. The price was set at 110,000 dollars. This was too much in our minds, so we continued to search for a home but kept an eye on this lot as well. After one month the price dropped to 100,000. That was interesting. October it dropped to 80,000. This was looking better and better. At Thanksgiving I was shocked to see the price at 70,000. This is the point where we began looking for a construction loan. We were hoping to pay no more than 60,000 dollars for a lot. We decided to get crazy and try to wait for the price to drop to 60K. Just before Christmas it dropped to exactly 60K and we jumped on it. We were afraid if we waited for anther price drop we would definitely lose it eventually to another bidder.

One thing we thought we had on our side was the other three homes had not sold yet. I called the real estate broker and put in an offer for 48K. She was not happy about the offer saying that we were very low considering how much the price had dropped in the past few months. I made it clear that 48K was our only offer. Within two days the bank responded with an offer of 59K. We came back at 49500. After three days the bank responded with with 57500. So we once again responded with 50K. When the real estate broker called us the next day she stated that the bank wanted to know our final offer. After much discussion, my wife and I decided to gamble and go for a final of 51K. Within 24 hours it was accepted.

In less than three weeks we had the deed to the land in our hands. I have bought two other houses in my life and this cash transaction was simple. Within the following month all three homes in the neighborhood had sold. We had gambled and won.