Urban Life

HELP FOR HOME SELLERS

In a market like this, selling a home is a difficult process. Help is available for many home sellers though in the form of the Ameridream program.

Ameridream is a down payment assistance program (DPA) that began in 1999. The concept of the program is pretty simple. However, its ability to help a home seller is often overlooked.

The program gives down payment assistance to home buyers who are cash poor but credit worthy and used in conjunction with an FHA loan. The down payment money comes from an Ameridream fund.

The flip side of the coin is the seller of a property is required to contribute an amount equal to Ameridream's contribution back to the fund. This amount is generally 6 of the sales price plus a 375.00 administrative fee. As a home seller you may be thinking I am crazy to believe this might be help. Don't give up on me yet, there is a method behind the madness.

Most home sellers have executed price reductions on their homes and are considering another one. Think about this first. How many extra buyers would be in a position to buy your home if they didn't have to come up with a down payment? Could the amount you would contribute to Ameridream be close to the amount you are considering for your next price reduction?

Let's look at an example. Say your home is on the market for 300,000. Participation in the Ameridream program will cost you $18,000 +$375.00 = $18,375. Chances are your next price reduction would be 25,000 since most agents recommend reductions that take you into potentially new buyer pools and that occurs in 25,000-50,000 increments. This typical scenario makes it more advantageous to try the Ameridream approach does it?

The biggest advantage is that you are opening your home to a much wider audience than a simple price change would allow.

The rules of this game are pretty simple. Your home must be marketed for less than 355,000 (check with an FHA lender to verify this amount). Your home will still have to gain an appraisal for the sale price (true of all loans). The buyer must live in the home as their primary residence. You must sign an addendum to the contract agreeing to the contribution and administrative fee.

If you are a home seller considering your options, opting into the Ameridream DPA program may be worth investigating.

Gene Urban
Ron Urban
The Urban Team at Realty Executives
www.UrbanTeamAZ.com

Ignite Phoenix & La Piccola Cucina Mix Company

Ignite Phoenix held its monthly meeting at La Piccola Cucina this evening. If you’ve been to an Ignite meeting you know they are always held at interesting venues in the urban areas of Phoenix.

Our host, Andy Pappas, is the proprietor of La Piccola along with his wife Debbie and an incredible crew that delights in delighting.

Andy is a character and a wonderful addition to downtown Phoenix. He’s Greek and from New York. That is probably all I need to say, but there is more to this man than simple characterizations.

As you would expect, he is passionate and not afraid to show it. He delivered a talk to the group that was a mix of history, philosophy, and sociology. The theme was urban living and the problems of opening a small business in downtown Phoenix.

As we have heard so often before, the City of Phoenix is not pro small business. He told the story of working/fighting with the City and how it took over a year to get though the red tape necessary to open his small restaurant.

The story moved to the art of living in an urban environment. This was both fascinating and eye-opening. Andy says that our problem is that we don’t understand what it means to develop and live in a city. We are still too commuter oriented, whereas in a thriving urban environment people live, play, laugh and mingle in the same geographic area.

Before and after the talk we dined on some of La Piccola’s Mediterranean epicurean delights, and drank a bit of wine. The only regret is that we didn’t get to try his tempting deserts coffees, or the numerous flavors of gelato offered. A good reason to go back though.

Give La Piccola Cucina a try next time you are wondering where to go for a meal, desert or a good cappuccino, you'll be better for the experience.

La Piccola Cucina
2241 N. 7th St.
Phoenix, AZ 85006
(480) 203-3421
food, wine, coffee and free wifi.

A PURSE NEEDS YOUR SUPPORT

We are pretty excited about this news. Tracy Penwell, a good friend of Ruth Urban, has a pretty unique job... handbag designer. Yeah, you don't hear that one at many cocktail parties. Anyway, the story below is from Tracy and she needs our help. So, read on and help a fellow Arizonan attain fashion fame.
______________________________________________________________________________________________

Hi! I am asking you to vote for me. I am proud to announce that I have been selected as a finalist in the “Best Green Handbag” design category in the 2008 Independent Handbag Designer Awards by Handbag Designer 101. My handbag named “Summertime” was selected for being made out of sustainable, recycled materials. It features a collection of white wrist watches on the face of a white leather and straw clutch.

Some of you might not know that in addition to Rima Fine Art, I launched “Dressed Up Cat Fashion Re-Fashioned” to unleash some of my creative energies. I take high quality handbags, add unique jewelry and embellishments based on a ‘theme’ for each bag that leads to its name and a signed and dated pedigree card which accompanies each handbag in a custom made animal-print dust cover. Each bag is one of a kind and meets the demand for fashionable, smart, and “green” accessories.

I am especially humbled by this honor because my design was selected from 600 applicants from all over the world. Further judging will be going on in New York City in June where my bag will be on display in a window of Henri Bendel and I will be participating in a trunk show. The fashion panel of judges is very impressive. One winner will be selected from each of five categories and announced at the awards ceremony at the New York Historical Society on June 18^th.

But I need your vote for the “Audience Selected Handbag”.

The designer who receives the most votes will be announced at the Awards Ceremony in New York on June 18. On the internet please visit http://www.bagborroworsteal.com/ui/ihda. To vote for me just click the VOTE button by my name and my bag “Summertime”. To see more of my bags, please visit www.dressedupcat.com.

Thank you so much for your vote and support.

Tracy Penwell
“Feline-in-Charge”
Dressed Up Cat, Fashion Re-fashioned

FIVE IDEAS THAT MAY KEEP YOU OUT OF FORECLOSURE.

You can't read a paper or talk to a friend without hearing about someone who has lost their home. What we don't hear too much about is how to stop it from happening. Most of the time our fiends are too uncomfortable to talk openly about financial problems. Hey, I've been there, how about you? A few months back Ron and I got a mailing back from a client and found out they had lost their home and we had never heard from them asking if we could help. That one pained us a lot. They had a bunch of equity and we probably could have helped. Oh well... Anyway, below are some ideas we came up with to help others in trouble. Pass it on if you want.

THE FIRST STEP: TAKE ACTION
So many people are in trouble as a result of inaction. It's not surprising. We all get a bit embarrassed when finances are a mess. We get mad, depressed and tend to put our heads in the sand. Such inattention is a huge mistake. Action is called for when financial trouble is brewing. The first step is to get moving. Don't sit around watching TV and ignoring the problem. Take action now.

THE SECOND STEP: CREATE A BUDGET
If you are in trouble financially, you need a picture of the problem. You need hard facts to make good decisions. Imagine repairing your car without diagnosing the problem. You might replace a fuel pump only to find out it was an ignition problem. A budget is the first step in finding and resolving the problem.

What if you have never put together a home budget? There are many options and several are free. Do you work for a company that has a finance person? Do you attend a place of worship? Is there a family member who has a knack for good financial management? Ask an expert for help creating a budget and analyzing it for solutions. You can go on the Internet and find home budget programs too. However, finding a person with good budgetary skills may be more helpful as they can assist diagnosing problems and finding solutions.

THE THIRD STEP: CUT BACK ON EXPENSES
The easiest way to put more money towards problems is to cut back on expenses. Perhaps you'll need to stop cable TV service for a bit. Not forever, just a few months. Where else can you find non-essential dollars going out the door. Your budget will tell you. Gather the family, get input from the gang, explain your needs and see what each can give up for a bit while you regroup.

THE FOURTH STEP: INCREASE THE FAMILY INCOME
There may be hidden financial sources lurking within the walls of your home. I talked to one father who laid out the financial problems to his family and asked for help. The kids stepped up to the plate by taking on neighborhood jobs such as baby sitting, lawn mowing, paper routes, dog walking and such. Between the three kids, they brought in an extra $400.00 per month while the parents worked out some new home financing. As a family they made it through the rough times. Today they are prouder and stronger than ever.

THE FIFTH STEP: LEARN ABOUT FINANCES AND BECOME AN EXPERT
They say knowledge is power. Why… because it is. No one tries to fail financially. They simply don't have the skills in place to win. Become your own expert. The library and Internet are great sources for articles on financial management. In addition, there are lots of people who love to teach when they have a motivated student. We have a lender we turn to for knowledge about home loans. She loves that we want to learn and boy does she have a lot to teach. Ministers, priests and rabbis often know retired executives who like to lend a helping hand. They simply need to know you need their assistance.

That's all from the Urban Advise Column for this week. Pass it on to a friend in need and we wish you well.

Gene Urban and Ron Urban
The Urban Team

Copyright2008

5 NEW RULES FOR HOME BUYERS

CNNMoney.com had an article entitled 5 new rules for home buyers. (Click Here For The Story) I found it to be a thoughtful article with some good motivation for buying a home in today's market and some cautionary thoughts

I was surprised how much thought went into the section on "You can't time the bottom." Most writers give a bunch of fluff with a bit of content. Amanda Gengler, the author, gave strong commentary advising people to pace themselves, drive a hard bargain with the seller and to be mindful to sell your home first as it could be on the market for a long time.

Her 4th rule has great value as well. She titles it: Don't buy cheap; buy good schools. The interesting point here is why she advises buying homes in areas with good schools. It isn't for the schools, it is for what the schools represent... enduring quality of the neighborhood.

We often caution potential buyers to be less sensitive to the price and more interested in the neighborhood. Quality neighborhoods hold their value better than sub-par communities. I'd add that buyers should be looking at location within a community as well. An interior lot or a home with a view has intrinsic value that when added to a good neighborhood add up to even more benefit. I especially like homes that have rare, yet popular features such as views, golf course lot, and such.

The last rule hits home for my brother Ron and me. Rule 5: Make sure your agent has your interest at heart. Make sure your agent is looking out for your interests only. Showing you their own listings, generally, does not serve the buyer. The agent will reap greater financial rewards because he or she has the potential of receiving a larger commission. However, agency laws prohibit the agent from providing the same level of counsel when representing both sides of a transaction as he or she would if representing only one party. In other words, the agent can not work solely on your behalf. He or she will act as an intermediary and can not be a strong advocate for either party.

The Urban Team does not do dual agency (working for both the buyer and seller) because we feel each side of a real estate transaction deserves full representation. Make sure your agent has your best interests at heart, not their commission. (I bet I get a few hate mail letters over this one... it's a hot issue and our position is not the most popular one among our peers.)

That's it for this post. Hope you have a great weekend.

Gene Urban and Ron Urban
The Urban Team

SIFTING THROUGH THE REAL ESTATE RUBBLE

I am sure many of you read the article by Catherine Reagor in the Rupublic today. If not, click here. Marshall Vest, a UofA economist, Jay Butler, ASU real estate analyst, and RL Brown of the Phoenix Housing Market Letter were asked a number of tough questions and Catherine reported their answers. 

If you went online to AZCentral.com you saw several hundred posts from mostly angry people. It always amazes me how few people comment on the content of the post verses rant about "stuff."

Enough of my ranting though. The article made several good points and gave some hidden tips for those experiencing the problems associated with the market.  Let me outline a few items I saw.

1.   All tended to feel that most of today's real estate problems could have been alleviated had lenders and builders not been so anxious to approve buyers for loans that were outside of their financial comfort zone. Likewise, if more buyers has shown restraint and looked at the long term implications of the loans they were accepting, less would be in trouble today.

2.    A true real estate investor is a well educated, highly capitalized person who has a game plan and the knowledge to execute it.

3.     We are still not out of the woods. However, there are areas that will fair better than others both on a National scale and a local one. Some areas in Greater Phoenix are doing fairly well while others are in the tank.

Let's just look at those three ideas and see what we can learn and how we can be better prepared for the future.

1.   Many homeowners accepted unwise loans. As with anything, knowledge is power. If you are going to apply for another home loan or refinance, get a second opinion from someone with great expertise. People often ask us why we send so many people to Judy Giel at First Horizon Home Loans. It's simple, she is first an advisor and she doesn't try to "sell" people loans. She teaches people about the short and long term implications of different products and works very hard to keep them financially safe. You need an advocate on your side... find one before you apply for your next loan.

2.   I know several people who jumped into the investment game. Some sought counsel, studied books and articles on the subject and laid out the groundwork for successful investing. They made hundreds of thousands and still have it. Others ignored advise and jumped in ill-prepared. Most of them are in bankruptcy. Like anything, real estate investing takes knowledge and preparation. If you are planning on taking advantage of the current low-home prices, do your homework first. Feel free to contact us for a list of items a successful landlord/investor needs to know before making the plunge.

3.   Since we are not out of the woods, planning is key. If you are in financial trouble, gather the troops to help. Too many people put their head in the sand until it is too late. Get help putting together a budget and game plan. Perhaps someone at your church or job can help with this. Don't be embarrassed asking for aid, people generally like helping others in trouble. Judy Giel, the lender we discussed above would be happy to help you look at your loan options. She really is a caring woman with great knowledge. Get a second job, sell your toys, and hunker in. If you are in trouble, you can often get out by simply making smart changes.  Get your family in on the project. Kids can mow lawns, babysit and would be honored to help with a family crisis if asked.

URBAN COOKIES... YUM

Happy day after Mother's Day. Hope you and yours had a great day.  We are beginning an ongoing series of articles featuring members of Local First Arizona.  For those of you not familiar with Local First Arizona, you may know them as Arizona Chain Reaction. If that doesn't ring a bell, visit their web site (click here) to find our how this fine organization helps support locally owned businesses. 

This week we want to tell you about Urban Cookies. We first learned about Urban Cookies when my brother's wife, Ruth Urban, called asking us if we knew about a gourmet-organic cookie maker that had the same name as us... Urban.  We hadn't.

We thought it would be a good idea to order some cookies for a few clients... thus having Urban Cookies from the Urban Team. It was a marketing no-brainer. What was even more exciting was the response we had from those lucky recipients. You'd have thought we gave them trips to Bora Bora or something. They couldn't rave enough.

Rather than tell you about the exceptional ingredients, all organic of course, and the amazing flavors, we think you should simply go to their web site... www.urbancookies.com and try some for yourself.

By the way... Shaun Breese, the cookie chef, tells me that cookies for your favorite canine are coming soon and the very yummy Urban Cookie Ice Creme Sandwich will be available in June. 

That's all for this post. Enjoy and shop Arizona first.

Gene Urban

The Urban Team

IS NOW THE TIME TO BUY OR UPGRADE A HOME?

Many of you know I like a site called Trulia.com. It is a home search site, not a great one though, and an information site, its real strength. On the information side, people can ask specific real estate questions and get answers from a variety of pros in the business. Some of the answers are spot on and some are glorified sales messages disguised as answers. You'll know the difference when you read them.

I saw a question/statement from another agent and wrote a response. Below are my thoughts:

QUESTION/STATEMENT POSED:  Did you know that now is the best time to buy or upgrade a home?

I would agree that it is a great time to buy a home and I am not so sure it is a good time to upgrade. Our broker, John Foltz, made an interesting statement at our last managers meeting. He said, "This is the time millionaires are made."

He referred to the fact that sharp falls in pricing occurs rarely. The last time I remember a similar market was during the S&L crisis in the 80's. A number of friends bought during that low cycle and have profited well. One friend bought a cabin/home on the Rim for about $50,000 that is now worth in the $200,000 range. Another bought a 3000 sq.ft. home in the Phoenix Mountain Preserve for $82,000 that he sold in 2004 for $440,000.

As far as upgrading, I would be hesitant. I doubt we will see an increase in equity by upgrading for the next couple of years. Of course, adding additional square footage is often an exception especially since builders are hungry and an addition that costs $140/sq.ft. for a home valued at $200/sq.ft. will achieve a net value increase.

We are advising our clients to be cautious about remodels/upgrades and strongly urging them to maintain a minimum of 25% equity in their homes from current market value. Such a position will keep them safe if we experience further price declines.

Gene Urban
The Urban Team

The Desert Botanical Garden... Great Classes Coming Up

It is pretty easy to forget about the treasures sitting in our own back yard. Not the yard behind your house, rather the yard that our city. Today I'd like to remind you of the Desert Botanical Gardens and the classes they offer.

I don't know about you, but I often go to the garden department at Home Depot or to one of the local nurseries and look for plants to add to our yard. The Big Box stores don't offer much help and it seems I keep running into teenage helpers at the nurseries who don't know a lot.  I often leave a bit frustrated or buy a plant that turns out to be the wrong one. This weekend was the frustrating type of trip.

In response I Googled gardening in Arizona and was offered a trip (online) to the Desert Botanical Gardens. I clicked on the education tab and found a section on workshops with topics including: trees, ground cover and vines, shrubs, native grasses and wildflowers and much more.

So, I plan on making it to a few of these workshops and really learning about the plants that can make my yard more fun. If you want to join in the festivities, drop me an email and we'll make it a party.

Best to you,

Gene Urban
The Urban Team