Archive for Uncategorized
HOMEPATH MORTGAGE ASSISTANCE
Big news in the real estate business….you can
Let me know if you need help. This is yet one more way to get first time home buyers into the market. Don’t let this pass you by!!
BUY VS. RENT
Should I just rent, or should I buy? That
is the million dollar question. Is it financially feasible to rent? No, not necessarily especially in one Arizona county - Pinal. The median home price in this county is $69,000. That coupled with the low interest rates and availability of FHA loans — which require at minimum a 3.5% downpayment — make this a much better option than renting. The communities this encompasses include Florence, Coolidge and Eloy.
DOWNSHIFT IN FORECLOSED PROPERTIES IN PHOENIX
From July to August, Phoenix saw a decline
in the number of foreclosed properties. This according to ASU’s realty studies Director, Jay Butler. The number of sales are up from the same time last year as well. The foreclosures are driving the market and we will not really know if the housing market here in Phoenix is truly “recovered” until we see the investors slow down in their buying. The true measure of a healthy market is “normal sales”…..i.e., people who want to move put their homes up for sale — not people are losing their homes and banks just want some if not all of their money back.
Prices have also increased here in the Valley. A mere 1%, but it’s an improvement. In one year, the prices (on the average) have dropped 29%. Hopefully, we will be able to continue to see recovery. This will also depend on the rate of unemployment and the state of the economy. As you know all of these factors are tied together….it’s a house of cards, so to speak. When you remove a bottom card, the whole tower falls.
Only time will tell. Consumer confidence needs to return and we need to stop bleeding jobs and opportunity. This is a capitalist economy and the government needs to let us come back on our own. By artificially propped up the economy we’re just heading in the wrong direction.
PHOENIX HOUSING MARKET
There’s some good news for the Phoenix housing
market. Unbelievable that it’s been 27 months of declining prices for homes in the metropolitan Phoenix housing market. Started out slower, then boom! In any event, after 27 months, according to ASU Professor Guntermann, a 3-month period of prices holding, sends indications that we’ve most likely hit the bottom of this decline. There will most likely be certain markets that will continue to see drops in pricing….i.e., luxury home market. Some areas will be harder hit than others, but it’s a positive sign that buyers are once again entering the marketplace.
Most buyers are under $200k and first time buyers, but they are keeping the market going. We’ll most likely continue to see short sales and foreclosures for sometime to come. This can change the scenario because foreclosures drive down the value of the “regular” sales. Stay tuned….I’ll keep you updated as I find information.
WHY ISN’T MY HOUSE SELLING?
This is a common lament from a lot of homeowners.
There are a number of reasons why your home may not be selling. Let’s start with the current market. Owners need to be out of the mindset of several years ago….that is past and hopefully, will stay in the past. Those were way overinflated times and we don’t need that again. Unfortunately, if you bought during the highest point, you may be out of luck. This is why we are seeing, and will most likely continue to see, short sales and forclosures.
You need to objectively look at your home as a “buyer”…..I often suggest that my sellers view similar homes to see where they rank in the “wow” factor. There will be both nice and not so nice listings and it’s good to actually see the homes in person. Don’t just rely on the pictures on the internet…..sometimes photos hide all manner of mistakes.
It’s VERY important that you stage your property. I am a huge proponent of first impressions are lasting ones. Curb appeal is key to getting the buyer into the right mindset once they’ve entered the house. If they don’t like what they see outside, chances are that they’ve already got preconceived notions of what’s awaiting them inside. Some buyers I’ve been with will not even go inside if they don’t like the outside. While there are exceptions to this rule, why take the chance. Make sure your yard is freshly landscaped. Make sure all bushes and trees are trimmed so that potential buyers can see the house. Remove all hoses from the front. Sweep the doorway. Make sure your door is clean and any windows clean as well (this goes for the entire home…no one wants to look through dirty windows–let the light in!). Stand on your curb, look at the house….really LOOK….be critical; pretend you are a buyer! If your home looks tired, spruce it up a little.
You MUST, MUST think of yourself as moving. There’s no use in putting your home “on the market” to test the waters. This is a waste of time for you, your agent and others. If you’re not serious and you cannot wrap your brain around moving, wait until you can. Prior to listing, I suggest starting your packing. Remove personal items, i.e., religious icons, photographs, books that are controversial, etc. This way, buyers will look at the space and not focus on who lives there. People are funny that way, perhaps they won’t buy because of your religion….you just never know; why give them the opportunity to walk away because of that.
Straighten your closets….this doesn’t mean call Classy Closets, it means pick things up off the floor and/or pack. Plastic bins are terrific organizing tools. Make sure that your clothing is neatly on hangars. Also, linen closets need to be straightened up….don’t give buyers a chance to fixate on the messy closets and not the storage space they offer.
If you’re going to pack, stack the boxes — neatly — in the garage. If you have a lot of things in the garage, clean it up. Have a garage sale and get rid of everything you don’t use/need. Call a charitable organization to come by the day or so after to pick up everything that doesn’t sell. Are you going to move and put the same things into your new home that you didn’t use in your current home?
Kitchens need to be clutter free. Clear the countertops as much as you can. Put papers away. Put small appliances away. Let buyers see the space. Make sure surfaces are clean and the sink is sparkling. Also, buyers may open your refrigerator….be prepared. A pantry, if you have one, is also something that needs attention….make sure it looks neat.
If you have children, now is a good time to teach them to pick up their toys. You’re not expected to remove everything, but keep toys to a minimum. If you have a playroom, make sure that the floor is clear for entrance.
Look at the walls, do you need to paint? I suggest a fresh coat if need be…..most buyers will feel differently about a freshly painted home….it feels cleaner. Buyers will like that they can move into a home without worrying about painting.
Don’t take anything that your selling agent says personally. He/she wants to sell your home as much as you do. Better for one of them to tell you about negatives than hearing it constantly from potential buyers. Get a head start on preparing your home properly for sale.
Last, but certainly not least, PRICE is key. It’s better to price competitively in the beginning than to keep dropping the price. Remember, if your home is priced appropriately you’ll get showings. You should have the greatest amount of actively in the first few weeks a listing is on the market……this will tell you if it’s priced right. Be prepared for a lot of competition. You must also be aware of the way appraisers are viewing properties today. If your price is too high, it may not appraise out and then you’ll have to negotiate down or lose the sale.
Ultimately, chose a realtor who is honest, fair and who you like. This is a very personal decision and oftentimes very emotional. Think of your home as a commodity. You’ve decided to sell, it’s time to move on!
FORECLOSURES–BANKS BEST INTERESTS??
What is the government doing to stop/slow them
down? While the admininstration continues to grapple with the enormity of the housing crisis vis a vis foreclosures, lenders are not helping people stay in their homes by modifying their loans. Some lending institutions feel that letting the home go into foreclosure is actually cheaper for them. Out of the 1.5 million foreclosures, a mere 200,000 loans have been modified….less than 3%. The banks are of the mind that even if they modify a loan there’s a chance that the homeowner will eventually default even with a smaller payment. (Washington Post, July 28, 2009 by Renae Merle)
The unemployment rate is contributing to that scenario as well. People are struggling to stay in their homes, but when they lose their job(s), they don’t have a choice but to walk away. The news was good for June that the real estate market has ticked up, however, we still have a long way to go. The foreclosures will continue to drive down value and until we can clear the inventory, we have to play the waiting game. In the end, I don’t think anyone knows how this will turn out.
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.
LOAN MODIFICATION
Are you in need of a loan modification? Do you
know if you qualify for a loan modification? The vast majority of Americans don’t even know if they qualify. To qualify for a loan modification, you’ll need to prove hardship, i.e., loss of job, decrease in income, illness, etc. This is not for people who are “upside down” in their mortgage. My suggestion is that if you are upside down and you can ride this out, hang in there. Pay your mortgage and deal with it. There are a lot of people out there in homes all over the valley in all price ranges who are suffering the same unfortunate circumstances.
Have you tried calling your bank? Are you getting anywhere? Does this sound like your situation? Unfortunately, there are many companies out there taking advantage of people — making promises they cannot keep. Here’s your clue, if a loan modification company wants money up front, that is a sign that they are not operating above board. They should not take a dime from you until and unless they can help you. There are computer programs that honest companies have that allow them to input information which then tells them if you are a “pass” or a “fail” for loan modification.
I am working with a company that employees former bank employees that worked within those banks loss mitigation departments. They know how to get the information through. They know who to call.
In addition, should you not qualify for a loan modification, they’ve done the paperwork to set you on the right track for a short sale scenario.
I’ve linked to the site….great people with your best interests in mind.
Wall Street Rally - What Does This Mean For You
To think that the numbers on Wall Street have
nothing to do with our economy is just plain wrong. When the stock market is doing well, it goes hand in hand psychologically with people’s confidence in the economy. While I don’t think that Wall Street should be the only barometer on how we run our lives, I do believe that the numbers reflect what is happening in the marketplace. If the investors show confidence, it spills over to the consumer. Don’t get me wrong we’re still way below the crazy high of 13,000, but at least we’re holding firm with the normal up and down movement that is the stock market.
While the real estate market is showing signs of leveling off, there are still parts of the country that are hurting bad. Keep in mind that you cannot judge every market by the national news media. Remember, tragedy sells and therefore it is much better for ratings if they project doom and gloom. Be sure that you are getting an accurate read on your own market and not listening to the “averages” across the country. Averages can be dragged down by one low number and in the converse brought up by one high….keeping everything in perspective is important.
It is also important to have a realtor who knows what’s going on in the world. Knowledge is power and you want an advocate that is able to decipher the information and give you the very best information available at any given time.
The Phoenix real estate market is going strong. We continue to see movement in number of homes listed (it continues to decline) and homes that are in escrow (this remains high). That along with consumer confidence picking up can only mean a win win for us all!
GOOD NEWS FOR ARIZONA - FHA LIMITS BACK UP!!
The limits are: sales price $358,000 the max financing loan amount (96.50%) can be $346,250 in Maricopa county. Limits vary from county to county. The information can be found on various sites. I do have several names of reputable lenders that I’d be happy to share. In addition, I’d love to help you find the perfect home. This is truly a buyer’s market. In addition, you don’t even have to look for a foreclosure or a short sale to find great buys!
As always check with your financial advisor before making any final decisions.
