Archive for For Sellers
SUMMER IN PHOENIX
I have a friend who wishes he was in San Diego.
Frankly, I think Arizona is pretty terrific. Yes, summers are hot. It’s the desert. We’ve lived here 12 years and you do not get used to it, you tolerate it. It’s the same every year, people complain about how hot it is. It’s this hot every year! We suffer through several months, because the remainder of the year is wonderful…..
The days are getting shorter. This means that the desert has more time to cool down. It’s only the end of July. We don’t start getting cooler nights until September. We had a really wonderful June. I don’t ever recall having to shovel sunshine. And, if you want to get out of the heat, you only need drive to Show Low or Flagstaff to experience cooler temps….what more could we want?
To that end, I saw an article in the local paper this past weekend that the prices for “summer homes” is amazing in the mountains….great time to buy up there……we did 3 years ago and it is wonderful…..even in the winter!!
JULY REPORT ON PHOENIX HOUSING MARKET
Phoenix real estate market report for June, 2009
shows the following statistics according to The Cromford Report: Regarding active listings in Phoenix beginning in March-July 2009, actives went from approximately 9,000 down to 6,000 …. about one-third. In Scottsdale for the same time period March-July, 2009, active listings decreased by slightly less — 4,100 to 3,100 about one-fourth.
In addition, the number of pending listings has dropped a little in most major cities within phoenix. This is most likely attributable to the economy and the fact that the inventory is down a little. We will still need to see some movement upward to give us hope that we have indeed turned the corner in the downward spiral and are heading up.
Overall, there’s about a 9 month inventory of homes. This will vary slightly from city to city and the higher end homes (over $500k) are sitting longer as the pool of buyers for those properties is smaller. The pending sales are down a little from last month, however, sales are up. This is a good sign. We want fewer homes on the market. This creates “need”.
There are many investors still coming in and buying homes, fixing them and either renting them or turning them around and making a few thousand dollars. This is a good thing in that fixing the properties that have been foreclosed on only improves the value within an entire neighborhood.
There continues to be good news on the home front as people’s confidence levels come back. I believe that the jobless rate will keep things in check, but overall the news is positive. First time homebuyers and investors continue to drive our market. The higher priced homes move slower, but there is great opportunity out there.
PHOENIX DEFICIENCY AMENDMENT
Recently, the Governor of Arizona, Jan Brewer
is getting ready to sign legislation that is supposed to take effect on September 1, 2009 eliminating our current anti-deficiency policy in the State of Arizona. This is HUGE. The banks, who are the ones on the band wagon here, have lobbied the Governor to change this law. Essentially, SB1271 would allow banks to go after homeowners for the balance owned on their home after foreclosure…..the difference between the amount they received for the foreclosure and the amount owed on the house. This also will affect investors because in order to be covered by the anti-deficiency law, the investor will have to prove that they have lived in the home(s) for a period of not less than 6 months.
Here’s a quote as described in layman’s terms:
Cause: One of the problems Arizonans facing foreclosure have is the very short timeline involved. We have one of the shortest in the nation – only 90 days from default. And now we are going to let banks chase defaulting borrowers for recovery above and beyond that which is recouped when the bank sells off the foreclosed house.
Effect: So suddenly the banks no longer have any incentive whatsoever to work with a borrower to resolve delinquencies. Now the bank can quickly foreclose, sell the house below market value and then go after the defaulting owner for the difference! This will in turn drive down Arizona real estate prices even further. Perpetuating falling real estate prices will only worsen our struggling economy. Furthermore, the relationship between the lender’s rights and the borrower’s rights will be seriously imbalanced by this change to the current law. The only winners here will be the banks who got us into this financial mess in the first place.
Our real estate market has taken enough of a hit, this will virtually kill it. If you can, call Governor Brewer’s office and express your concern about this terrible piece of legislation and tell her you support the Arizona Association of Realtors plea to her to revisit this decision as soon as possible through the special session.
I don’t know about you, but I’m getting worn out from all this government intervention and having to put my 2 cents in!
PHOENIX HOUSING MARKET UPDATE
While the number of closings has been creeping up
over the last several months, we should not get too excited just yet. We still have a long way to go. While the foreclosures tend to dominate the market, we still need to pull in traditional buyers to get the market up out of the hole. We are still seeing investors purchasing the really low end properties. Hopefully, they will repair them and hang on to them for awhile while the market stabilizes. The only way we’ll see an increase in value is when the demand is higher than the inventory.
I’m not an advocate of runaway price increases…..that is what contributed to putting up in this mess. We need to see a gradual increase in prices as buyers gain confidence in the marketplace once again. Let’s see what the next report brings.
REAL ESTATE SALES STATISTICS-PHOENX
Real estate sales statistics, according to the
Cromford Report are down from the same time last year and last month. I am going by normal transactions….this meaning that this particular statistic does not include foreclosed properties or short sales. Active listings are down, which is good for keeping over saturation in check, pending listings are down slightly from last month and up from last quarter.
As far as percentage of all types of transactions, number of active listings are down across the board; pending sales are down slightly from last month, but up overall. We can attribute most of the activity to first time home buyers and the fact that the prices are low enough to entice them into the market. The sale of townhomes and condominiums is down significantly.
I believe people are still cautious. Consumer confidence is down, credit is available, but not like it should be. I don’t think you should be able to buy a home without a downpayment. Homeowners need to have some “skin in the game” in order to feel compelled to make it work. We will most likely continue to see foreclosures for some time to come.
Should you be interested in a statistical report for your particular zip code or city, please feel free to contact me.
WHAT REALLY CAUSED THE MORTGAGE MELTDOWN?
Recently, there’s a very interesting article in the
Wall Street Journal that brings attention to other factors that contributed to the mortgage meltdown. Written by a professor of Economics, Mr. Stan Liebowitz, from Texas University, says that politicians need to stop trying to make this a politicial issue and deal with the root cause. He states that “51% of all foreclosed homes had prime loans, not subprime” therefore, tighter regulations on lenders who would lend money to people who did not understand the complexity of the loan….i.e., an ARM (adjustable rate mortgage). Moreover, he states that “Sharing the blame in the popular imagination are other loans where lenders were largely at fault — such as “liar loans,” where lenders never attempted to validate a borrower’s income or assets.”
Loans that were made to people without substantiating their income/assets has largely contributed to this situation as well. If someone doesn’t have a “stake” in the transaction, they are more likely to walk away. “If substantial down payments had been required, the housing price bubble would certainly have been smaller, if it occurred at all, and the incidence of negative equity would have been much smaller even as home prices fell.”
This is something I have been saying all along. If you don’t have any “skin in the game”, what’s to say you won’t walk away? This too will pass and would have passed even if the politicians weren’t involved. Nobody “deserves” a home if they cannot support the upkeep — that includes mortgage payments — or substantiate their income stream. Larger downpayments should be required…..we don’t want to go through this again.
LIFE IN SCOTTSDALE
Hope you all had a good 4th of July weekend. We
stayed in town. Last year we headed up north to Show Low for the holiday and it was crazy. I love it up there, but I’m more laid back and like the peace and quiet, so we tend to steer clear of the holidays when everyone else goes up. Anyway, we stayed here and it was a lovely weekend. We had a quiet Friday night and on Saturday we ate at one of our favorite spots….Eddie’s House on Indian School Road in Scottsdale. The food is terrific and you can always count on a great meal and great service. The restaurant was quiet at 7:00 pm, but we don’t mind. I love that it’s small and intimate instead of large and noisy. Eddie wasn’t cooking, he was spending well deserved time with his young family.
As always, my husband had the meatloaf which is out of this world. I settled for the lobster special. Everything was amazing and we took the Tiaramisu home for many bites over a couple of days…..we understand that the desert will be sold through Costco and/or Sam’s Club come fall…..can’t wait to try it….after dinner we went home and enjoyed watching the fireworks from our patio.
We had some family over on Sunday and the weather was wonderful. We expect 100+ degrees at this time of year, so no surprise there. However, it doesn’t seem so bad when you’re floating around your pool with a cocktail!
REFINANCING NEWS FROM HUD
Good news for those in need of refinancing
and they are upside down….the following statement was recently released:
1) WASHINGTON - U.S. Housing and Urban Development Secretary Shaun Donovan today announced an expansion of the Obama Administration’s Home Affordable Refinance Program to include participation by borrowers who are current but up to 125 percent underwater on their mortgage. Under authorization provided by the Federal Housing Finance Agency, borrowers whose mortgages are currently owned or guaranteed by Fannie Mae and Freddie Mac will now be allowed to refinance those loans according to the terms of the Home Affordable Refinance program established earlier this year.
CAP AND TRADE AND YOUR HOME
I don’t like to bring politics into my real estate blog
except when it will impact the housing market. Americans need to be informed on the massive Cap and Tax (Trade) bill that squeeked by in the House of Representatives and is headed to the Senate where hopefully calmer heads will prevail. Be advised that there is a provision in this 1,300 page bill that the government wants to mandate that the California building codes be instituted across the nation. This has worked so well for California that we all want it, right?
Be sure to check online…there are many sources where this information is available. This is not a party issue this is an issue that will affect your ability to buy or sell your home. If you care at all about what’s happening as the politicians slip this under our noses in the dark of night, you’ll become involved and make sure that you are contacting your Senate representative to vote NO to this legislation that will not only impact your ability to sell your home, but will add up to $6,000 per year in additional energy costs to run your home…..do you want the government telling you what temperature to keep your home, mandating the quality of your windows, doors, etc.?
Don’t take my word for it….google Cap and Trade and read all you can….we should be outraged!!! We must be informed.
GOOD NEWS IN THE PHX HOUSING MARKET
Up from the lowest point in April, 2009, we’ve seen
a rise in the median price from $116k to $124k. This is a 7.8% increase in sales prices. Of course, these prices are seen in areas where buyers were seeing homes selling for $50k. These homes have now cleared the market place and this bodes well for the gradual increase in value…..as we have experienced in years past. In addition, the market is clearing itself of the bank owned properties according to the Cromford Report data.
There are rumors, however, that the banks will be releasing more toxic assets at the end of this month. The quantity remains to be seen. As a realtor, I can only imagine what a large influx of foreclosures would once again do to our market. I believe that if we continue to see unemployment rise we will continue to see more foreclosures.
I work with a group doing loan modifications and they are having great success. This may be our only hope of holding the market steady while we wait for the economy to rebound. While not everyone is a candidate for a loan modification, there are many who are.
