Sunday, May 29, 2011

Rocky Point vacation units hit by drop in buyers

The vacation-home market in Mexico's coastal city of Rocky Point, Sonora, is bound to the rise and fall of Arizona's economic prosperity, like the ocean's tide to the moon.

That fact will come as no surprise to the hundreds of Phoenix-area residents who have purchased an estimated 2,400 beachfront condominium units and detached vacation homes in the city also known as Puerto Peñasco.

Richard Savino, president of the Rocky Point Board of Realtors, estimates that Valley residents own about 60 percent of all vacation properties built in Rocky Point in the past decade.

At the moment, the Rocky Point housing market is in a major slump. Of the city's estimated 4,000 vacation condos and houses, about 650 properties are listed for sale, Savino said.

Based on the Puerto Peñasco vacation-home market's average transaction flow of about 16 sales per month, those listings represent a more than three-year supply of inventory.

A healthy housing market generally has about six months' inventory listed for sale.

Although he expressed confidence that the Rocky Point housing market eventually would rebound, Savino said it would have to be preceded by significant economic recovery north of the border.

"We're all kind of waiting for the U.S. economy to turn around," he said.

Savino visited the Phoenix area last week to meet with administrators of the Arizona Regional Multiple Listing Service, which for the past two months has been involved in a mutual exchange of home listings with its Rocky Point counterpart.

Savino, an American who has been living in Rocky Point since 2007 and brokering real-estate deals there since 2008, hopes the sharing of Rocky Point listings with metro Phoenix real-estate agents will bring added visibility to his area's housing market while giving U.S. agents an opportunity to get more involved and potentially earn some additional referral fees.

To represent either the buyer or seller in a Rocky Point real-estate transaction, agents must have a Sonoran real-estate license. Savino obtained his Sonoran license in 2008. He continues to work as a real-estate agent while managing two local condominium communities to make ends meet.

Despite the market's current problems, Savino said he is confident that buyer interest in the Rocky Point vacation-home market eventually will return.

The introduction of direct commercial flights to and from Puerto Peñasco's recently built, but barely used, airport would provide a significant boost to the area's housing market, he said.

One of Savino's goals is to persuade a major airline to add Rocky Point to its itinerary. A small Mexican air carrier had been offering flights about a year ago, he said, but it canceled the service about six months later.

Not enough passengers, according to Savino.

He blamed the dearth of travelers not on the weak economy but on a string of news reports that started coming out just before spring break in 2010.

The news reports linked Rocky Point to a public scare over recent drug-related murders in Mexico, Savino said, adding that most of the drug-related violence has been in major cities and not around Puerto Peñasco, which has a population of 45,000.
"It is a safe place," Savino said. "I would not be living there if it wasn't."

by J. Craig Anderson The Arizona Republic May. 29, 2011 12:00 AM

Rocky Point vacation units hit by drop in buyers

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