Valley Has Wealth of Luxury Homes

Catherine Reagor
The Arizona Republic Jan. 20, 2008

Metropolitan Phoenix, long known for its affordable new houses on the fringes, has become a magnet for affluent home buyers.

Nearly every suburb of the Valley, from rural Buckeye in the far southwest Valley to the farm community Queen Creek in the far southeast, posted sales of homes with seven-figure prices.

Paradise Valley, Scottsdale and the Biltmore and Arcadia neighborhoods of Phoenix continue to be the hot spots for the Valley's poshest homes. Nine out of metro Phoenix's 10 priciest homes are in Paradise Valley. The town hosts the most expensive dwelling: a $26 million estate with more than 31,000 square feet of space.

But as Historic metro Phoenix grows, more deep-pocketed buyers are opting for other areas closer to their work, family, favorite golf course or mountain preserve.

A few years ago, more sales of million-dollar homes started showing up in the older central Valley neighborhoods, in the new high-rises in Phoenix and Tempe, in well-established West Valley neighborhoods of Litchfield Park and Glendale and next to the mountain preserve in Ahwatukee.

More recently, luxury-home builders have started constructing speculative million-dollar homes in farther out communities known more for semi-affordable luxury homes and good schools. Among them: Ocotillo in Chandler, Las Sendas in Mesa, Estrella in Goodyear, Verrado in Buckeye and Vistancia in Peoria.

Craig and Wendy Kasten recently bought a $1.1 million home in Gold Canyon's Superstition Mountain golf community. The couple, who live most of the year in Wisconsin, have been visiting the Valley in the spring for several years.

"We looked in Paradise Valley and north Scottsdale, but the homes were smaller and there was more traffic," Craig Kasten said. "We wanted the best house for our money."

The Valley's million-dollar-home market slowed in 2007, but seven-figure sales weren't down as much as the rest of the market.

Last year, 2,227 million-dollar homes sold across metro Phoenix, according to an Arizona Republic analysis of real-estate data from the Information Market. That compares with 2,505 in 2006, which is about an 11 percent drop.

Overall, home sales were down almost 30 percent Valley-wide.

"Buyers are definitely looking for values," said Walt Danley, a luxury-home real-estate agent in the Valley with Coldwell Banker Residential. "But I haven't run into any million-dollar buyers having trouble getting financing because most are paying cash or putting significant down payments down."

Like the rest of the housing market, the number of listings of million-dollar homes is up.

There are 3,500 new and existing homes with price tags above $1 million for sale on the Arizona Multiple Listing Services Web site. In 2005, there were half that many pricey homes for sale Valley-wide.

Lawrence Yun, chief economist of the National Association of Realtors, said many people from pricier housing areas such as California and New York are buying million-dollar homes in Arizona because they are deals compared with the home prices they are used to.

Sandra Baldwin, a luxury-home agent with the Phoenix office of Equitable Real Estate Co., said the Valley's growing luxury market continues to attract a lot of buyers from not only out of state but also internationally. But she said like the rest of the area's housing market, some owners of million-dollar homes are overpricing their properties, which works to slow sales.

Two-thirds of the Valley's ZIP codes with large residential sections had million-dollar home sales last year.

The adage that buyers get more house and land for their buck the farther they drive holds true for the luxury-housing market, as well.

"A million dollars will get a buyer an old, smaller home that needs work in Paradise Valley and a newer home on a golf course with almost everything they need but their toothbrush in Chandler," said Mo Yaw of Realty Executives Ahwatukee.

A Mesa home listed for $1 million has 5,500 square feet, an acre lot, two master suites, a pool and spa, five baths and two offices. The least expensive home for sale in Paradise Valley was listed at $2 million. It has 3,500 square feet, three bathrooms and a pool.

Buyers looking for million-dollar homes can find them in most new suburbs. Besides getting bigger homes, some people who grew up in parts of the Valley and can afford million-dollar homes don't want to move away from their longtime neighborhoods.

"People who lived in Arrowhead on the west side and now can afford a million-dollar home are moving to Verrado, not necessarily Scottsdale," Baldwin said. "People from the old farming families in the southeast Valley are buying million-dollar homes in Chandler and Gilbert."

Only a few of the Valley's biggest suburbs didn't have million-dollar sales last year. But two of those ~ Laveen and New River - now have residential properties listed for more than $1 million.

"The housing market may be slowing now," Yaw said, "but new exclusive pockets of million-dollar homes are going to keep opening up in the Valley."

Search for luxury homes with Laura B. at her Historic Central Phoenix website who specializes in Historic Luxury Homes. Contact her today at 602.400.0008. Laura B. is a licensed Realtor in Phoenix with DPR Realty, LLC. Member MLS, NAR, PAR. EEOC.