The collapse was devastating in a city that has long depended on housing to power its economy. In the last year, Phoenix lost 41,000 construction jobs and 136,000 overall, accounting for 7% of its workforce.
Home building came to a halt. Many illegal immigrants, discouraged by the sudden lack of jobs, returned to Mexico. Realtors cut staff. Home prices dropped faster and faster each month for two years.
Until March. For the first time in two years, the decline in home prices slowed -- from 37% in February, compared to the previous year, to a still-painful 36%.
Arizona State University business professor Karl Gunterman noted the incremental slowing in a report last month, saying it could be signs of the market bottoming out.
"Once this thing turns, it may turn slowly," Gunterman said in an interview. "But at some point I think it's going to pick up because prices are so low."
Mike Orr, a Phoenix real estate analyst, thinks the market already has hit bottom. Among the signs: As recently as January, a year's worth of homes sat on the market; in March, that dropped to seven months' worth of inventory.
"It's a dramatic change in just three months," he said. "I never imagined it'd get this crazy this quickly."
Orr thinks mid- and high-priced properties still will lose value in the coming months.
"I wouldn't be investing in luxury right now," he said. "But if you're looking for inexpensive homes, you're going to have a fight on your hands."
In a throwback to the boom, real estate agents and investors are swapping stories of brutal competition for bottom-end homes.
Orr called on one property to find it had already received 14 bids. Realtor David Thomas recalled getting a client in a $60,000 foreclosed home in the suburb of Avondale, on a street lined with vacant properties. He recently returned to find almost all the for-sale signs gone.
Jenkins, who has looked at more than 80 houses, said she was being cautious not to get caught up in the frenzy.
"It's going to create the same damn situation we had before," she said. "You're going to buy a house and it's not going to be worth what you paid for it."
Skeptics of the turnaround note that the competition for foreclosed homes may be artificial. They argue that the number of bank-owned properties has shrunk because some lenders held off on foreclosures early in the year as they waited for President Obama to unveil his plan to aid distressed homeowners.
