New Resort? Sonoran Star?

Has anyone heard about this? It looks like a sign was put up somewhere around town? There is a website but it seems more like a placeholder for now...

https://sonoranstarresort.com/

I don't know where it will actually be, I assuming they're gauging interest, so the can put together a sales package to start pre-sales.
Since there still are many unfinished units at the Esmerelda, Casa Blanca ( I heard they are trying to re-start finishing units here) and Las Polomas
still has an empty tower unfinished, this doesn't make sense.

The Encantame project at Playa Encanto seems like it will sell out, so maybe the Star is going to try latching onto this momentum.
Property sales and prices are doing well in Penaso, so this might have a chance to succeed. Who knows?

I would just wait for the next downturn in the economy to buy and better pricing vs the sky high prices we are dealing with now

We still have a few years to run in this bull market in Peñasco real estate. A secondary market like this usually lags several years behind primary markets like Phoenix. In 2021 Phoenix had one of the top appreciation rates in the US. I predict that price appreciation still has at least two years to go here, and maybe a lot more. In addition to demand you also have inflation, which is generally significant in Mexico. Look at interest rates on Mexican bonds. Additionally, there is a lot of pressure to increase minimum wages in Mexico, and construction supplies, appliances and fixtures have been hard hit by supply chain issues. Prices could continue to increase for years.

Idyllwild said:

We still have a few years to run in this bull market in Peñasco real estate. A secondary market like this usually lags several years behind primary markets like Phoenix. In 2021 Phoenix had one of the top appreciation rates in the US. I predict that price appreciation still has at least two years to go here, and maybe a lot more. In addition to demand you also have inflation, which is generally significant in Mexico. Look at interest rates on Mexican bonds. Additionally, there is a lot of pressure to increase minimum wages in Mexico, and construction supplies, appliances and fixtures have been hard hit by supply chain issues. Prices could continue to increase for years.

The bubble is about to pop in Phoenix. 1/3 of the demand is investor demand. Highly volatile. Rents, mortgages and property taxes increasing YOY compared to wages. Rates are about to start rising. There's no more profit incentive for investors so the sell off will start soon and while it will take a few years or more to see the depreciation there are signs that it could be as much as 25-30%. As soon as Open Door, Redfin and Zillow dipped out it was over! From what I remember in 2008 the market in RP was pretty connected to US markets Phx, Tuc. There wasn't much lag. I'm sure a lot of that then had to do with cash out refi's and leveraging too much equity. Las Palomas 3 was essentially defunct by 2009... I don't know though, I'm not an expert but I do read and follow people that are much smarter than me. I thought we would have seen the crash sooner than this with covid so I was wrong about that but that's because the fundamentals of economics don't matter when you pump that much cash into the economy. I think we only delayed the inevitable. The downturn is right around the corner. Of course if you're a long term investor or lifer then short term economics don't really matter. The next 3-5 years could be volatile for any short term investor getting into the market right now. I follow this guy that bought put options on Zillow and Redfin, betting against their stock price because he knows the bubbles are starting to pop or verge of popping in a few key markets across the US and sofar in the 6 months of following this guy he's been correct on everything he's said. It's all data driven lecture using US Census Bureau historical data and seeing this information on graphs it's pretty evident based on historical trends that the shtick is over... Not sure how this relates to a secondary vacation market like RP but if I had to guess it's somewhat relative considering the influence of Americans from Phx, Tuc in high appreciation markets. ReVenture Consulting on YouTube if anyone wants to listen. He might do a podcast too, not sure.

I’ve got a lot of skin in the game. Prices will continue to go up but at reduced rates compared to 2021. I’ve just reviewed my investment performance for last year, and I’m planning for this year. There will be no crash. Rather a cooling off. I’ve bought, inherited, or sold 9 or 10 houses in the last decade. There is nothing like the subprime mortgage securitization crisis of 07-08 to drive a collapse in housing prices. Some people I know have spent the last several years on the sideline waiting for a correction in housing prices. They missed out. The housing market has at least another 20% to run in the next 2 years. I’m more worried about stock and bond funds. It’s almost certain there will be a 10% correction in the S&P 500 this year — because that’s typical volatility. A bear market (20% from peak) is more problematic, and I’d say that’s 50% likely to happen, but how long it would last is what matters, and whether you are positioned to treat it as an opportunity. Bond funds will be hurt as the 10 year treasury note climbs from 1.5% to more like 2.0% as the Fed winds down buy-backs and moves toward actual rate increases by Q3 or Q4.

Houses in Arizona and Puerto Peñasco will be more expensive next year. As minimum wages continue to increase toward a living wage in Mexico and supply chain constraints in building materials, fixtures and appliances remain, price increases for new construction will be a fact in Puerto Peñasco even without demand increases.

Next to Las Gaviatos.

Queen of Kings said:

Next to Las Gaviatos.

If that is the case, many people, especially the locals and Mexican visitors will lose their favorite beach.

...

Next to Las Gaviotas

The resort will be on the east end of Sandy Beach.

I'll just leave this here....

Bloomberg.

The slide is here and it's going to be substantial.

1/3 of all demand in Phx is investor demand. "The selloff has started".

https://www.yahoo.com/finance/news/jeremy-grantham-doubles-down-crash-161247192.html

Mexico Joe said:

I'll just leave this here....

Bloomberg.

The slide is here and it's going to be substantial.

1/3 of all demand in Phx is investor demand. "The selloff has started".

https://www.yahoo.com/finance/news/jeremy-grantham-doubles-down-crash-161247192.html

I would be surprised if the coming sell off is more than a 10-15% slide. It is long overdue.
The cash poor investors will be the most affected by this.

So many houses/condos in AZ have been scooped up by big investors needing rental properties and people
moving to AZ from California.

Mexico Joe said:

I'll just leave this here....

Bloomberg.

The slide is here and it's going to be substantial.

1/3 of all demand in Phx is investor demand. "The selloff has started".

https://www.yahoo.com/finance/news/jeremy-grantham-doubles-down-crash-161247192.html

Joe:

You posted a random article from a stock contrarian predicting a big downturn in stock prices and morphed it into an assertion that home prices are sliding. They are not. This New York Times piece from yesterday argues that home prices are going to keep moving up due to a fundamental supply and demand imbalance, and this is the mainstream view.

https://www.nytimes.com/2022/01/20/upshot/home-prices-surging.html

As far as stock prices go, if you reread my January 2 post on this thread you will see I predicted a 10% correction in the S&P 500 this year as normal volatility, and we’re getting close to 8%, so it might happen. People who saw this happening already took protective action like creating a cash reserve to fund expenses for 6 months or more. Some planners were recommending 9 months. That repositioning contributes to a short term decline in share value, as retirees and other investors sell stocks to bulk up their cash. The bond market (with different problems) will continue to be hurt by rising rates, but ten year T-Bill rates in the vicinity of 1.5% had to go away. Who wants a savings bond that yields below the rate of inflation? It may be that mortgage rates will creep up to 3.5 to 4 % in the next year. Will that crater house demand? In the early 90s I had a mortgage at about 8.5%, and in both 1998 and 2007 I took out mortgages at 6%. The tax code rewards mortgage borrowing. There is no housing bubble. 2021 saw year-over-year increases as much as 20%. Prices are expected to rise about 10% in 2022.

BTW, the website at the beginning of this thread is bogus. Someone apparently trying to gather leads by posing as the Sonoran Star. Not sure yet who they are as it is set to private. The phone number goes to the message "Sonoran Star Sales". Messages are not being answered. Drives me crazy that some people stoop to that level in order to make a buck. Anyway, the official (real) website and Facebook page are below:

www.sonoranstar.com
https://www.facebook.com/sonoranstar

Jim said:

BTW, the website at the beginning of this thread is bogus. Someone apparently trying to gather leads by posing as the Sonoran Star. Not sure yet who they are as it is set to private. The phone number goes to the message "Sonoran Star Sales". Messages are not being answered. Drives me crazy that some people stoop to that level in order to make a buck. Anyway, the official (real) website and Facebook page are below:

www.sonoranstar.com
https://www.facebook.com/sonoranstar

Jim, since you are here, would you answer one of the original questions as to the exact location of the new Sonoran Star?

Idyllwild said:

I’ve got a lot of skin in the game. Prices will continue to go up but at reduced rates compared to 2021. I’ve just reviewed my investment performance for last year, and I’m planning for this year. There will be no crash. Rather a cooling off. I’ve bought, inherited, or sold 9 or 10 houses in the last decade. There is nothing like the subprime mortgage securitization crisis of 07-08 to drive a collapse in housing prices. Some people I know have spent the last several years on the sideline waiting for a correction in housing prices. They missed out. The housing market has at least another 20% to run in the next 2 years. I’m more worried about stock and bond funds. It’s almost certain there will be a 10% correction in the S&P 500 this year — because that’s typical volatility. A bear market (20% from peak) is more problematic, and I’d say that’s 50% likely to happen, but how long it would last is what matters, and whether you are positioned to treat it as an opportunity. Bond funds will be hurt as the 10 year treasury note climbs from 1.5% to more like 2.0% as the Fed winds down buy-backs and moves toward actual rate increases by Q3 or Q4.

Houses in Arizona and Puerto Peñasco will be more expensive next year. As minimum wages continue to increase toward a living wage in Mexico and supply chain constraints in building materials, fixtures and appliances remain, price increases for new construction will be a fact in Puerto Peñasco even without demand increases.

In Phoenix the influx from the chip manufacturing plants and their associated suppliers will keep things rolling for a while.

Idyllwild said:

We still have a few years to run in this bull market in Peñasco real estate. A secondary market like this usually lags several years behind primary markets like Phoenix. In 2021 Phoenix had one of the top appreciation rates in the US. I predict that price appreciation still has at least two years to go here, and maybe a lot more. In addition to demand you also have inflation, which is generally significant in Mexico. Look at interest rates on Mexican bonds. Additionally, there is a lot of pressure to increase minimum wages in Mexico, and construction supplies, appliances and fixtures have been hard hit by supply chain issues. Prices could continue to increase for years.

Canadian money is still just pouring into Phoenix “According to Tricia Lehane, a sales agent with RE/MAX Excalibur in Phoenix, there are more than 25,000 Canadian homeowners in the Valley of the Sun. As investors, she says they operate both long-term and seasonal rental properties. In particular, the Phoenix-Mesa-Scottsdale area, known as Maricopa and Pinalcounties, is hot.” Has anyone noticed an increase in Canadian buyers in RP?

Old55 said:

Canadian money is still just pouring into Phoenix “According to Tricia Lehane, a sales agent with RE/MAX Excalibur in Phoenix, there are more than 25,000 Canadian homeowners in the Valley of the Sun. As investors, she says they operate both long-term and seasonal rental properties. In particular, the Phoenix-Mesa-Scottsdale area, known as Maricopa and Pinalcounties, is hot.” Has anyone noticed an increase in Canadian buyers in RP?

Canadians don’t buy when the markets hot. Currency exchange makes it less appealing. If anything their selling off from 2008 and heading home.

Idyllwild said:

I’ve got a lot of skin in the game. Prices will continue to go up but at reduced rates compared to 2021. I’ve just reviewed my investment performance for last year, and I’m planning for this year. There will be no crash. Rather a cooling off. I’ve bought, inherited, or sold 9 or 10 houses in the last decade. There is nothing like the subprime mortgage securitization crisis of 07-08 to drive a collapse in housing prices. Some people I know have spent the last several years on the sideline waiting for a correction in housing prices. They missed out. The housing market has at least another 20% to run in the next 2 years. I’m more worried about stock and bond funds. It’s almost certain there will be a 10% correction in the S&P 500 this year — because that’s typical volatility. A bear market (20% from peak) is more problematic, and I’d say that’s 50% likely to happen, but how long it would last is what matters, and whether you are positioned to treat it as an opportunity. Bond funds will be hurt as the 10 year treasury note climbs from 1.5% to more like 2.0% as the Fed winds down buy-backs and moves toward actual rate increases by Q3 or Q4.

Houses in Arizona and Puerto Peñasco will be more expensive next year. As minimum wages continue to increase toward a living wage in Mexico and supply chain constraints in building materials, fixtures and appliances remain, price increases for new construction will be a fact in Puerto Peñasco even without demand increases.

100% agree with your statement above.
I couldn't have said it any better.

As long as equity in Arizona housing continues to increase housing prices in Penasco will increase. Many people use the equity in their primary residence to finance their vacation home purchases. I live in Playa Encanto and there is a lot of construction going on here, comparatively speaking.

There is a lot of construction in town and in Cholla as well.

mexicoruss said:

There is a lot of construction in town and in Cholla as well.

You got that right. Gone from Las Conchas for 20 months and 6 house went up In our section. Everywhere you look house are being renovated or being built.

https://rockypoint360.com/sonoran-resorts-to-develop-the-sonoran-star/

The last public beach in the area soon to be a fading memory for the locals.

JJ

Jungle Jim said:

The last public beach in the area soon to be a fading memory for the locals. JJ

I thought the same thing. The new mayor claimed the project would not impact local access to the beach, but how could it not? Someone has to lose out- either the locals lose easy access to the beach, or the new condo owners will be battling with hundreds of locals littering the beach with tecate cans and tostito wrappers...

You know if it weren't for the "beach" Puerto Penasco wouldn't even exist. Every job in that ville is somehow related to tourism.
If someone form the USA say like Phoenix thinks they can just take a drive down to PP for a day on the "beach" they will have a rude matter of fact when they arrive. Just try to find a beach, not to mention park near one!

After the Playa Hermosa beachfront becomes private for the tourists, the last remaining public beach will be the little strip between Mirador and Las Conchas. Leave your vehicle there unattended and you will have your windows busted out and robbed of anything inside. The window busting rocks are right there for thieving bastards use as soon as you walk down to the water.

One could always do what we do, drive at least sixty miles south then cross the desert and muddy salt flats, drive over the dunes then find some of the finest unspoiled coastline anywhere. Better have a serious off road vehicle before even considering it.

JJ

JJ, I've parked there a 5-6 times, I find a guy to watch my car and pay him $5.
I then tell him there's more $ coming when we return.
So far not a scratch, but we have nothing of real value left inside of it.

Heck the car was even washed for me with water when we returned. LOL

Now we go to the beach in-between the Esmerelda and Sonoran Sun resorts, pay the $5 and enjoy the beach, vendors and all.