Urban Life

What's Happening with 85014 Real Estate, Home Prices & Foreclosures

Today we'll take a look at the real estate market in Phoenix's 85014 zip code. We'll be giving you a snap shot of the area and our take on homes & condo prices. In addition we'll look at the effect foreclosures are having on real estate values.

85014 is located in an area locals call Central Phoenix. The map will give you an idea where it is located.

The area is generally home to a younger population with the higher age numbers falling into the 20-40 range.

A variety of schools serve the area. Brophy and Xavier generally top the list for fine academics and the Madison Schools (Rose & Park) are well considered. 

Locals have a number of fine restaurants to enjoy. I'm a fan of Lola's Tapas, Richardson's, Christo's and Two Hippies. 

The area supports a broad residential real estate mix with single family homes (SFH), condos/townhouses/patio homes (Condos in our analysis), apartments and small rental properties.

Both home and condo prices have been highly affected by the foreclosure market. 24 of the 33 homes sold in 2009 and 13 of the 19 condos were either foreclosure properties or short sales. In other words, 69% of the sales in 2009 were due to foreclosure or near foreclosure... this is a bit higher than County average. As we have said many times, foreclosures drive down home values due to aggressive pricing strategies.

Below is a chart showing the asking price (in $/sq.ft.) of privately owned homes and bank owned properties. The difference is dramatic. The average bank owned property is priced at $120/sq.ft. less than the average non-bank owned home. WOW!   It's no wonder the bank owned homes are first to sell.

In most of our downtown and central Phoenix research we see the SFH market out performing the condo sector. In 85014 both home types are facing the same difficulty. Inventory levels are to high: 11months for SFH and nearly two years for condos.

Most of the condo trouble is centered around afew properties with Citi on Camelback (Citi) topping the charts. Citi has, as of this post, 30 units on the market with 24 being foreclosure or short sales. The good news is sales in the complex are brisk indicating they may have found a bottom price point.

Our Conclusions: 85014 is pretty ripe for first time home owners and investors to swoop in for a deal. If you are trying to sell a personal residence, condo or home, you may want to take a serious look at the competition with regard to pricing; it's a jungle out there. I do not expect to see prices stabilize until inventory numbers start approaching 8 months and foreclosures drop to under 30% of the sales. The graph below from citi-data.com pretty much sums it up. 

Gene Urban
The Urban Team at Realty Executives
602-234-5777
www.urbanteamaz.com  (our web site)
www.greatinvestmenthomesaz.com (our first time real estate investors site)

Additional recent Phoenix real estate market and home value analysis can be found on Urban Life at:

85012
85020
Phoenix (Overall)

Downtown Phoenix Tree Planting a Success for Phoenix, SRP and Valley Forward

Yesterday, Mayor Gordon was joined by downtown residents, SRP, Valley Forward, Enterprise Rent-A-Car and others, like me, who just wanted to help make the Valley a better place to call home.

Valley Forward registered the 120 or so people who wanted to get their hands dirty and Mayor Gordon was brought to the stage... actually a bit of grass in front of a hole soon to be filled by one of the 40 trees slated to be planted.  Gordon thanked the various people who made this event possible: SRP, Enterprise, Valley Forward, Phoenix Fire Department, Roosevelt District folks, Girl Scout Troop 436, City of Phoenix employees and more.  Gordon has a goal to make Phoenix the Country's greenest city. One cost effective way is to plant trees. It also gives us much welcomed shade.

The 40 trees were donated by SRP and Enterprise Rent-A-Car while the gathered masses donated time and muscle planing them. Much to our delight, the city had brought in a back-hoe that dug the holes for us; my back liked that a lot!  In addition, property owners signed agreements to water and care for the new trees planted in front of their places. This means no tax dollars will be spent maintaining these trees... pretty creative partnering in my humble opinion.

Richard Adkins, the City's forestry supervisor and certified arborist gave us a quick lesson on planting trees. Did you know you should take a knife and make a light cut on the roots at the bottom and side where the container bound them?

The volunteers, already divided into groups, went to work leveling out the holes, taking trees out of their containers, cutting the roots and adding dirt to fill the holes. Phoenix Fire brought in a couple trucks, providing water as we filled each hole. Before we knew it, 40 Chinese elms were in the ground, dirt leveled, trash picked up and proud faces smiling.

Here is a little video of the event. Hope to see you at the next one; I'll be sure and announce it here on Urban Life... your blog for downtown Phoenix.

Gene Urban
The Urban Team at Realty Executives
602-234-5777

Real Estate Market Update For 85020 in North Central Phoenix

Today we offer a real estate update for 85020 in Phoenix's North Central corridor. We've scoured the ARMLS numbers, crunched some data on our statistics web site and have a lot of information for you.

Like most of the Valley, 85020 is seeing brisk sales of mostly bank owned properties. Bank owned single family homes dominated with 60% of the 2009 sales. The condo market was a reverse with 60% not being banked owned properties.

The graph below provides an idea of the market trends in 85020. The market hit its high in late 2005, early 2006, held pretty steady until mid 2008 and fell back to near 2004 prices. This is a pretty common price trend for much of central Phoenix and many other areas. 

The prices started to stabilize in late 2008. The March numbers confirm the steady median price at $150,000. Sixty-one percent of the single family home sales in March were REO and suggests the banks, Fannie, Freddie and others have found a bottom line price buyers seem to like. Most sellers are generally getting 94% of their asking price, so some negotiation is still possible.

Good news is found in the number of new foreclosures coming on market. The current active listings show only 20% are bank owned properties (SFH) and 23% (condos & townhouses.) This is down from the last quarter of 2008. In addition, the trustee sales (when a home is taken back by the lender's trustee) seem to be falling slightly. We'll be keeping an eye on these numbers as they have a strong affect on home prices.

If you are a person, verses a bank, selling your home may take a while. The days on market figures are rising a bit and there is much competition. Today, there are 215 single family homes and 149 condos for sale through ARMLS. Last month 26 homes and 12 condos were sold. These statistics suggest a 9-10 month inventory. Ideally, we like to see inventories in the 6 month range. If you are priced above $500,000, patience is your friend. (I feel like a fortune cookie saying that.) We're simply not seeing many sales for the higher priced homes anywhere in the Valley unless they are screaming deals.

In conclusion, 85020 is following much of the Phoenix market. Lower price homes appear to have found some bottom strength. Homes in the higher price range, $350,000 and above, will likely linger on the market for a while. It's just hard to beat some of the foreclosure deals out there.  Real estate investors and first time home buyers will find a number of opportunities in 85020 with over 50 SFH offered at under $100,000.

Below is a home search tool showing the available properties in 85020. The initial view displays the 20 lowest priced homes.You can refine the search to find what interestes you.  Note: You can search for bank owned homes on this site too.

If you have questions or would like our opinion on your home's current value, we are happy to help. Just toss us an email or give a call.  Best to you,

Gene Urban
The Urban Team at Realty Executives
602-234-5777

The data provided is deemed accurate and is provided by ARMLS and Reality, Inc.

Loan Modifications, What They Are, How to Do Them, and HopeNow.Com

Jim Murphy, a Phoenix-based real estate attorney with Carmichael & Powell PC, spoke at our office meeting this morning. He discussed a number of issues including loan modification. I thought I’d pass on some of his wisdom, as well as our thoughts on the subject.

Let’s say you find yourself unable to pay your current mortgage payment. Maybe the interest rate went up, your employer cut your hours… something changed. One of your options is to seek a loan modification from your lender.

Simply stated, a loan modification is exactly what it sounds like.. a modification to the terms of your loan.

• Your lender may agree to extend the payment period and re-amortize the loan.
• The lender can lower the interest rate.
• The lender may tack any amounts in arrears to the principle balance and re-amortize the loan.
• Sometimes, not often, lenders reduce the actual loan amount.

In other words, you and the lender try to find a way to make the payments affordable and keep you from defaulting on the loan.

How do you proceed with a loan modification? There are a few ways:

BUNKY BOUTIQUE... clothing, hats, jewelry shopping in downtown Phoenix, AZ

You ever have that person you want to buy something sweet, not too expensive and kind of unique for? You try the mall but everything looks so mallish. There is an alternative... Bunky Boutique in downtown Phoenix's Roosevelt District.

Rachel Richards, the owner, has taken a historic home and made it a wonderful clothing space. Three rooms from the original home now house a remarkable assortment of men's, woman's, kid's cloths plus a selection of classically modern hats from Brixton and affordable, yet distinctive jewelry. This is a classic Urban Life experience.

Rachel has an eye for merchandising in small spaces. Everything is easy to see, cozy yet not cramped with surprises in every space.

We had a chance to chat about the place, her take on downtown and what Bunky means. 

What are you most proud of in creating Bunky Boutique?  Being able to contribute to the neighborhood and be a part of creating the Roosevelt and downtown Phoenix experience.

What's the best thing about living downtown?The people and real sence of community. It's a place where one person can still make a difference.

What's a Bunky? It's not a what but a who. Bunky is my grandmother's name and she is alive and well. I say that because people think when you name something after someone they are probably dead.

Bunky Boutique is worth a trip downtown for many reasons besides its mix of light weight cotton woman's clothing, fun hats, unusual T's, and jewelry. Its a real store where the owner greets you, cares about your experience and the city she lives in. You know I am a BIG supporter of locally owned businesses and the members of Local First Arizona. I hope you are too.

Bunky Boutique
Rachel Richards... proprietor
812 N. 3rd St.
Phoenix, AZ 85004
www.bunkyboutique.com
602-252-1323

One thing I love about my little Flip Video cam is the ability to show what words often can't. Below is a look at Bunky Boutique.

WHAT'S THE GREATER PHOENIX AZ REAL ESTATE MARKET DOING?

We gave you our Phoenix area real estate market predictions at the end of 2008. We feel it is time to give a little update.

Let us know if you have any questions or want stats on a specific subdivision or zip code in the Greater Phoenix area and we'll be happy to provide.
____________________________________

Sales are up in most areas of the Valley… the number of sales, not the prices. Single family homes are selling better than condos and townhouses in most areas.

In February there were 5476 sales recorded on ARMLS verses 3081 a year ago… a welcomed 77% increase. 75% of the sales were homes priced under $200,000. Bank owned (foreclosures) properties accounted for a bit over 65% of all sales. Here is one more wild statistic… only 147 of the 5476 homes sold in February went for more than $600,000.

Sadly, foreclosures are on the rise again. Our predictions for 2009 foresaw an increase in foreclosures during the first two quarters of 2009 and so it is. We really wish we would have been wrong on that one; Very sad for a lot of people.

The foreclosure numbers for the end of February and early March came  in higher than we’ve seen in many months. High foreclosure numbers indicate prices will continue to fall. We know you don’t want to hear this, but the banks tend to price at lower than market value to get them off the market quickly.

If you viewed our predictions for 2009, you know we did not anticipate prices to stabilize until the end of 2009.  Nothing has changed on that front. A big unknown is the affect of the various bail-outs, artificially interest rates set by the FED and lack of viable data on the asset markets.

However, we’ll be watching unemployment, foreclosure stats and a few other economic indicators closely and adjust this prediction if needed.

Gene Urban
The Urban Team at Realty Executives
602-234-5777

Predictions are simply that... a best guess. We deem the information to be reliable and can not guarantee such. ARMLS is a trade mark of the Arizona Regional Multiple Listing Service.

MELTDOWN: IS THE FED RESPONSIBLE FOR OUR ECONOMIC WOES?

Like many, I’ve been following a number of articles, books and videos about the housing crisis and economic collapse. We, the Urban Team, feel it is important for us to gain as complete an understanding in order to best prepare and help our real estate clients.

A friend, whose wealth and financial knowledge is staggering, suggested I read, Meltdown by Tom Woods. 

To date, this is perhaps the most complete and logical treatise on the subject and likely the most unsettling.  Prior to this book, much of what I’ve encountered points to predatory lenders, poor monitoring by the SEC, an across the aisle push for affordable housing, poor bank regulations and finger pointing at the democrats and republicans (by each other). However, there is seldom mention of the FED. 

Wood’s book is the first I’ve read that looks the FED's role in our Nation's past boom/bust cycles as well as many other problems and myths our politicians and media are feeding us. Below is a quick chapter by chapter synopsis.

Chapter 1: A brief look at the many factors that have caused our current crisis with an emphasis on the FED.

Chapter 2: The housing bubble and how the government has been focused on symptoms rather than the disease.

Chapter 3: The politician’s futile reactions in the final months of 2008 and why their bailouts and packages will exacerbate the problems rather than provide a fix. An interesting note is that public opinion was hugely against the bailouts and fixes, yet our elected officials moved forward anyway.

Chapter 4: A look at why economic cycles are exacerbated by the FED’s artificial manipulation of money supplies. You’ll learn a bit about Austrian Economic Theory as well. 

Chapter 5: A historical look at the Great Depression and the myths that are still being propagated.

Chapter 6: A look at FIAT verses commodity currency standards. This chapter is a bit wordy as he puts forward many controversial ideas and thoughts.

Chapter 7: Where do we go from here. You’ll just have to read the book to find this one out.

I don’t think I’ve ever suggested a book on this blog and I am now. I believe Meltdown is an important read. I’d suggest putting your political party on the welcome mat as he swings a non-partisan bat at times.  Let me know what you think.

Gene Urban
The Urban Team at Realty Executives
602-234-5777

REAL ESTATE OPTIMISM ABOUNDS... IN CANADA THAT IS.

I was scouting a couple dozen newspapers and blogs this morning when I came upon an article on Toronto Real Estate West's site.  David Pylyp was discussing how Atlantic Canadians are optimistic about the real estate market.

David's comments were based on an RBC (Royal Bank of Canada) survey that found an upswing in consumer confidence with 25% indicating they plan on making a purchase in the next 2 years.

The RBC survey asked Atlantic Canadians a number of questions about: market conditions, what they are looking for in a new home, what is motivating their decision to buy and more.

One response to the survey intrigued me. 84% of the Canadian's surveyed believe a home is a good or very good investment. I wonder what the numbers would be in American at this time. My gut says less than 40%, but that's not backed up with statistics.

American's have little faith in the real estate market these days. I believe the astronomical number of foreclosures and lack of confidence in the banking industry are mostly to blame.  Canadians have far less reason to share our fears.

The foreclosure problem in Canada does not comparison to ours. I contacted a delightfully helpful woman named Delaine at Foreclosures.Canada.com. She pointed to a statistics portion of their site that clearly delineated the difference in markets. In all of Edmonton & Calgary, the January 2009 foreclosures (Canadians call this action Power of Sale) were 368 verses Maricopa County at 3009 for January 2009. If we adjust these numbers for population difference, the figures are still dramatically skewed.

Let me end this piece by saying that real estate is Canada is not picture perfect. They are having their troubles with devaluation of the Canadian dollar and an economic turn-down. However, I get the sense that they have an underlying confidence in their real estate market. I hope we return to that feeling in American one day soon.

Best of days to you,

Gene Urban
The Urban Team at Realty Executives
602-234-5777

NEW FHA LOAN LIMITS ARE GOOD NEWS FOR PHOENIX HOME BUYERS

This post is a bit delayed as I was in Santa Barbara for a family birthday celebration weekend... the big 80 for my mother-in-law.However, there is good news for both home buyers and sellers in the Greater Phoenix area; FHA loans are now available for higher priced homes.

At the end of 2008, the legislation that had raised the limits on FHA loans ran out. For the months of January and February you could not get one of those nifty FHA loans if you were looking at a home in the $300,000 to $350,000 range. That meant you had to come up with a hefty down payment, often in the 20% range and a definite bummer for many. The result was a slow down of sales for homes in the $300K price range and many unhappy buyers and sellers.That has changed and you can now get a low-cost FHA loan for homes selling as high as $358,627. I can hear the yelps of happiness.

It really is a good thing for many.I just did a search of homes in the downtown and central Phoenix area to see how many homes an FHA buyer could potentially qualify to buy... there were a whopping 485 possibilities. The map below give the the current offerings.

With all the bad news, we are certainly happy to bring a bit of good news to the table. By the way, if you want to check out an FHA loan, we know a truly great lender. She is honest, takes care of her peeps and knows more about mortgages and loans than anyone else we've work with... a true friend and pro in the business of mortgages named Judy Giel. So, how do you reach this fine lender? I think the highlighted text on her name is a clue.

Have a great one today and do something to make anther's day just a bit better.

Gene Urban
the Urban Team at Realty Executives