Greg Hancock's goal is to still be standing in the first quarter of 2010. And he's got a pretty good shot of being upright then, as pricing in the Phoenix market is trending in the direction towards affordability that his company, Hancock Communities, wants to meet.

Since leaving Meritage Homes-which had acquired his company 21 months earlier-in March 2003, Hancock has been mostly standing on the sidelines watching Phoenix's housing market skyrocket and then plummet, leaving first-time buyers in its wake. "The affordable buyer has been shut out here for the past six years," says Hancock.

He had been developing a 2,000-acre master plan in Buckeye, Ariz., with 10 million square feet of commercial space. But the 59-year-old Hancock admits he was "bored" and wanted to get back into residential construction. So he retrieved the "Hancock Communities" brand (whose license ran out last June), hired back many of the mangers who had worked for him as a private builder and developer, and started purchasing finished lots in Maricopa and Pinal counties from several builders, including Lennar, Centerra Homes, and Calex Homes. (Hanley Wood Market Intelligence, the research arm of BUILDER's parent company Hanley Wood, LLC, verified that Lennar sold all of the lots in its Horizon at Glennwilde and Destiny at Sorrento master plans in Maricopa.) All told, Hancock gained control of 1,074 lots in five subdivisions for just under $22 million, the equivalent of 50 percent of the lots' development costs.

Hancock says he financed these land purchases through acquisition loans and by entering into rolling option agreements where he will take down a certain number of lots each month.

Hancock Communities should have four model parks completed by June, at which point it would start building homes ranging from 1,100 square feet to 3,300 square feet (the largest will be on a 9,000-square-foot lot), and selling from $94,900 to $169,900. Hancock admits he's a little nervous about restarting a home building company in a county with an overabundance of unsold homes and foreclosures, some of them unfinished and stripped bare by vandals or unpaid contractors. However, what Hancock sees is an "imbalance" between the oversupply and demand for move-up and higher-priced houses.

Over the past two years, the median price of a home in the Phoenix area has fallen nearly 30 percent to around $200,000. And Hancock points out that over the past 12 months, D.R. Horton and Pulte Homes have lowered their prices in this market significantly and have closed a total of 10,800 homes. That's nothing to sneeze at when some market watchers don't expect total starts in the Phoenix area to get much higher than 30,000 this year. Hancock acknowledges that his homes must compete against the two giant builders' now-more-affordable inventory. "But we believe there is a big enough market for starter homes that we can get 3 percent or 4 percent and be successful." Hancock is currently looking for more land in Arizona to buy. 

Learn more about markets featured in this article: Phoenix, AZ.