High End Spreads Caught In 'Reverse Land Rush'

Even the upper end of the housing bubble is slowing. "Sen. John McCain, R-Ariz., tests the declining real estate market as he tries to sell his recently price-reduced $3.75 million Phoenix mansion. The 11,000 square foot estate, with its nine bedrooms and eight bathrooms, and eight surveillance cameras, has been on the market for three months." "Only six prospective buyers have checked it out, the Arizona Republic says. That led to a half-million-dollar price cut. A year ago, there were 145 homes priced at $500,000 or more for sale in Phoenix. Now, there are 1,341. Houses were selling in days last year, but now, it's taking an average of six weeks." "McCain and his wife, Cindy, who grew up in the house, want to downsize." And the Wall Street Journal reports that the rich and famous are trying to get out as well. "A decade or so after big names in entertainment, sports and business turned the rugged ranch into a real-estate fashion statement, many of them are packing up the wagon trains and pulling back out. Why the reverse land rush? Many wealthy ranch owners, celebrity and otherwise, are hoping to cash out after years of gains in real-estate, according to John Frome, a ranch appraiser in Afton, Wyo." "Also, for some who've made their second or third home on the range, ranch life has turned out to be anything but simple. Yearly maintenance costs can run $150,000 and up." "There are indications that now ranch properties have been backing up on the market. Rick Schroder's southwestern-Colorado ranch has been sitting on the market for 15 months, while Leon Hirsch's Montana ranch has gone unsold for more than a year. Spreads owned by tennis's Martina Navratilova and novelist Warren Adler both found buyers late last year, after more than four years on the market apiece." "Meanwhile, Harris Hudson, the former co-owner of baseball's Florida Marlins, has been trying to sell his 60,000 acres in Colorado for two years, first for $25 million, then for $20 million, and now he's planning to part with the property at auction." "Real-estate agents in these areas say ranch properties that sold in 2005 sat 22 months on average, about double the amount they spent on the market five or six years ago. Big auction companies, typically a last resort for anxious sellers, say they're putting more ranches on the block: National Auction Group says it sold 34 Western ranches last year, up from 22 the previous year." "One recent seller: Atlanta Braves pitcher Mike Hampton, whose 50-acre Colorado ranch went for $3.08 million last year, almost $1 million less than he paid in 2001." "Don Lucas, a venture capitalist in Atherton, Calif., says the mystique of the Old West drove him to buy a ranch in southwestern Montana in 1996. But Mr. Lucas says sometimes the 6,150-acre ranch could be a bit too out of the way. 'Sometimes you'd have to fly in your friends just to have people around,' says Mr. Lucas. He put the property on the market 15 months ago for $14.6 million, and later cut the price to $12.5 million." "Some in the industry suggest celebrity ranchers may have themselves to blame for a slowing market. The price of ranch acreage rose 11% in the third quarter of 2005, to $1,216 an acre in Western states including Oregon, Utah and Nevada." "Cable-industry veteran Leo Hindery Jr. would be happy enough to get out. In 1998, he thought he'd fulfilled a lifelong dream when he bought a 1,400-acre ranch in Larkspur, Colo. After he left Global Crossing and moved to New York, his family became tired of making the trip to the property's unpaved roads and manure-filled pastures. Now, he says he's spending about $500,000 a year to maintain the property and pay salaries for the ranch hands, a foreman and equipment." "Mr. Hindery put the ranch on the market a year ago for $13.7 million and trimmed the price by more than $1 million last fall. 'I've never tried to sell one of these things before,' he says. 'It's a big bloody place. Finding a buyer could take awhile.'"