A Phoenix housing bust: now whole subdivisions are in bankruptcy auction [The Real Estate Economy]

I posted last week that Frank Owens, a pivotal player in the Phoenix housing market, estimated that volumes for the major builders there would be halved next year compared to 2005 — and I later noted that it would actually be the third- and fourth-tier home builders who are going to be fighting for survival.

A proof to the theory surfaced this week. Turner Dunn Homes had filed for bankruptcy protection in the summer — after stranding a pipeline with hundreds of homes in various stages of completion. They’d promised buyers, sub-contractors and creditors they’d get their act together in four months. They failed. Instead, an auctioneer is now liquidating *FIVE* entire Turner Dunn subdivsions. The newspapers don’t seem to have picked up on this yet.

A local agent, Tracy Thompson, flagged this turn of events — and told me that she can’t recall a builder collapse of this magnitude in the region during two decades in the real estate business. The subdivisions are in the vast Maricopa-Casa Grande “green field” south of the city of Phoenix. The tragic fallout of the saga is that home buyers who put down deposits, former company employees and tradesmen may end up with cents on the dollars that are owed to them — if anything.

This area, by the way, is where John Wayne famously owned two ranches — later purchased by Mike Ingram, our November, 2005 cover subject who made tens of millions dollars by banking raw land in Maricopa.

The Turner Dunn auction is scheduled for Dec. 14 in Phoenix’s bankruptcy court. Presumably the assets will also include Turner Dunn’s domain name, which the trustee has apparently parked to collect pennies from type-in traffic.

Original post by noemail@noemail.org (noemail@noemail.org (Paul Kaihla)