Urban Life

April Real Estate Market News and Information Greater Phoenix

Our good friend Sarah Moran from Equity Title just sent the real estate market news and update for April 2011.

I like Sarah's approach to performing real estate market analysis and home price projections. Like me, she is based in supply and demand therory and she includes social connectors when possible. This report is a broad one with real estate market information Phoenix, Scottsdale, Mesa, Gelendale, Tempe and most other cities in the Greater Phoenix region. Thus, it is supply and demand based as social consideration such as job growth is too regional to be use when painting with a broad brush.

That said, here is the real estate market news for April 2011 provided by Equity Title and Sarah Moran:

Hello!

Here is the Market Update through the end of March 2011. Please note that the Valley Wide graph represents all of the MLS. The table below that graph just represents recordings for new and re-sales for Maricopa County.

Good News: Total active listings have dropped by another 2883 units over the beginning of last month. As of yesterday, we sit at 36,883 Actives, which is the lowest amount in April for the last two years! Good news for sales, too: Sales are up to 9135 for the last 30 days, as of yesterday. We are currently sitting at a 3.8 months of supply.Traditionally, 3.8 months of supply is considered a Balanced Market! Wow!

Distressed Market Pie Chart: This chart shows you the percentage of distressed properties that are being listed and sold. Short Sales currently represent 20% of the Closings and 38% of the active Listings for a 8.3 Months of Supply ~ This has dropped from the 9.8 months of supply we had in February. Distressed Sales (Short Sales and REOs combined) accounted for 66% of the total sales for March.

Closings are Increasing: There were 9118 closings in March 2011 vs. 8657 closings in March 2010 ~ which equates to a 5% increase over last year (even without the Tax Credit)! 

Reality Check: The Median Sold Price for Maricopa County for March 2011 was $120,100. In March 2006, the Median Sold Price was $260,000! In March 2000, the Median Sold Price was $132,000. Use this at your listing appointments to help explain what has happened to our market and get realistic list prices!

We currently sit at a 3.8 months of supply in the valley. This may seem balanced but the high-end market continues to be stagnant. In the entire MLS, only 88 properties sold for $1+ million for the month of March. An astounding 94% of the closed MLS Sales for March were less than $400,000!

Please click on the link below to take you to the Graphs. You can save/print/email them from there! Use these with all of your clients, SOI and Open Houses! Everyone wants to know what is happening in Real Estate - Be the authority!! Remember that you can always go to www.eta-az.com and click on Market Update for this info as well!

 

CLICK HERE FOR CURRENT GRAPHS

 

MONTHS OF SUPPLY

East Valley: 3.7

NorthWest: 3.6

Paradise Valley: 15.8

Luxury ($1mil+): 15.8 (WOW! This has dropped drastically!)

Southwest: 3.4

Peoria/Glendale: 4.5

Camelback Corridor: 5.0

Cave Creek: 6.4

Ahwatukee: 3.9

Scottsdale: 6.1

Apache Junction: 2.6

Fountain Hills: 4.4

Buckeye: 3.1

Desert Ridge & Tatum Corridor: 3.3

 

Home and Real Estate Values News 85032

Today we are looking at real estate and home values in Phoenix zip code 85032. The map to the right shows the boundaries of 85032 in north Phoenix. The area has much to offer with affordable housing, close proximity to the 51 and 101 freeways, and  Paradise Valley Schools. Plus there is excellent neighborhood shopping with Costco, Frys, Trader Joes, PV Mall and Desert Ridge too.

85032, like so many areas is seeing an increase in homes sold by short sale and a decrease in the number of bank owned homes. Current stats show nearly 1/2 of the homes for sale are short sales and only 18% are bank owned. In general, short sales help keep values a bit higher as lenders like to see the homes sell at or close to market value. (For more info on short sales, visit our short sale information site.)

Much of the data suggests some stability in 85032 home prices and values. Below are several important figures:

• Months of Supply = 3.3. This figure has been dropping each month. 3-4 months of supply is a healthy number.
• Days on Market for Sold Homes = 81. Days on market is the time it took to sell the home. In May 2009 this number was 106 so it seems homes are selling a little faster today.
• Number of Listings = 350. The number of homes for sale has remained pretty constant for some time now… another sign of stability.
• Pending Sales = 120. Pending sales have also been fairly consistent.

Overall, it appears that home values in 85032 have stopped the free-fall we saw in 2009. Short sales are dominating the offering and they seem to be getting easier. Bank of America has streamlined their systems as have other lenders. In addition, the number of successful loan modifications is rising, keeping homeowners in their homes.

We believe 85032 will continue to be a strong area of interest for first time home buyers and investors since median home prices are in the $120,000 range. That said, the large inventory of short sales and bank owned homes will likely keep the region from seeing an increase in values during 2010. The graphs to the right shows the influence of short sales and bank owned homes on prices and it is not a positive trend.

If you are thinking about buying a home in 85032, do your homework and buy the best quality for the money. Make sure and have a professional inspection and do not overpay.

If you would like to see what is for sale in 85032, take a look at the info below. The data comes directly from the Arizona MLS system and is updated several times per day. If you have questions about the area or a specific home, drop us a line and we’d be happy to get you answers.

Click on any home to open a window that will show all the homes for sale in 85032

Buyer to Select Title Company on Fannie Mae REO Sales

Good news for people buying Fannie Mae owned homes.  Traditionally, Fannie Mae used nearly the same addendum for REO sales as banks. The addendum stated the buyer must use the seller’s title agents and cost of transfer taxes and stamps would be the buyer’s responsibility.

The bank and Fannie Mae title and escrow policy has been a source of continuation for us, as well as other Arizona real estate agents. In most all real estate transactions the home buyer got to choose his or her title and escrow company. Banks changed the rules by insisting buyers use their title company. In many cases these firms were over burdened with files and did poor work.  

Fannie Mae issued a new addendum that allows a buyer to select his or her own title agent. This is a change in FNMA Policy and is welcomed with open arms by the Arizona Real Estate Community.

To find out if the REO property is Fannie Mae, go to:

http://loanlookup.fanniemae.com/loanlookup/.

Section 2, B of the new Addendum is as follows:

2. Time is of the Essence: Settlement Date:

B. The closing shall take place on a date (“Settlement date”_ on or before ______________, 20_____ (“Expiration Date”), unless extended in writing signed by the Seller and the Purchaser or extended by the Seller under the terms of the agreement. The closing shall be held at a place so designated and approved by the Purchaser. The Purchaser has the right to make an independent selection of their own attorney, settlement company, escrow company, title company and/or title insurance company in connection with the closing. The date the closing takes place shall be referred to as the settlement Date for purposes of the Agreement. If the closing does not occur by the Expiration Date, or in any extension, the Agreement is automatically terminated and the Seller may retain any earnest money deposit as liquidated damages.

Thanks for being a passionate reader of Urban Life and we will endeavor to bring you the latest news on real estate and downtown Phoenix.

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

Help For Phoenix Home Buyers

Have you thought about buying a home in Phoenix Arizona, yet you don’t have the money for a down payment and closing costs? Help may be yours under the Neighborhood Stabilization Program.

The city of Phoenix Neighborhood Stabilization Program (NSP) offers a home ownership assistance program providing $15,000 for down payment and closing cost assistance.  Eligible buyers must be

• Buyers must be able to qualify for an FHA loan.
• Have completed the NSP-required eight-hour Home Ownership Education Class and Credit/Budget Assessment counseling course.

There are a few other requirements to consider:

• Buyers must maintain the property as their principal residence.
• The total household income must be below 120% of area median income. 
• Program participants must contribute a minimum of $1,000 of personal funds for down payment or closing costs.
• The $15,000 is paid back to the city when the home-buyer sells the home or refinances. 

The program targets foreclosed single-family homes, town-homes and condominiums (condominium conversions are not eligible) that meet HUD Housing Quality Standards (HQS).  The purchased home must be a foreclosed home anywhere within the city of Phoenix limits and meet other eligibility requirements.

Many mortgage lenders can assist you with this program. We’ve had good results with:

Judy Giel
MetLife Home Loans
602-494-6000 x222
jgiel@metlife.com

Ron Hall
BNC National Bank
623-293-6970
rhall@bncnationalbank.com

Best to you,

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

What Is Homepath Financing and What are Home path Loans

Homepath is a FNMA, Fannie Mae, loan product for properties that FNMA has foreclosed on and have qualified for special financing. So what makes it so special? Well there are a few things:

• No mortgage insurance: This is the insurance that is required by a lender if you stop making payments.
• No appraisal: This is a house by house rule but they do waive the appraisal on properties.
• Low down payment: 5% in the Phoenix market, depending on your market that could be higher or lower.
• 15 to 30 year fixed mortgage at competitive rates.
• Protection for first time home buyers:

What is First Look for Fannie Mae Homes?

First Look is designed to provide owner occupants and buyers using public funds a “first look” at Fannie Mae homes. Under First Look, Fannie Mae will only consider offers from owner occupants and buyers using public funds during the first 15 days a property is listed in the local multiple listing service (MLS). If the property is still for sale on the 16th day, investor offers may be submitted and will be considered

I saved the best for last! FNMA is having a sale and here are the details:

Special Offers:

Fannie Mae is offering a 3.5% incentive* for buyers who purchase and close on a Fannie Mae-owned home between January 28 and April 30, 2010. Buyers purchasing properties listed on this site that are closed within this period may receive up to 3.5% of the final sales price for:

• Closing costs.
• The purchase of new Whirlpool® appliances by Fannie Mae.
• A mix of closing costs and appliances, at the buyer’s discretion, up to the maximum 3.5%.

*** Lenders may impose their own limitations on the use of the 3.5% incentive, so buyers should consult their particular lender for guidance.

To be eligible for this incentive:

• Offers must be accepted after January 28, 2010
• Property sales must close escrow before May 1, 2010
• Buyers must be owner-occupants, investors are excluded.

Who Can Provide a HomePath Loan?

FNMA has limited the number of mortgage companies to just a few of hundreds of lenders. If you would like to find one in your area, here is a link to the “find a HomePath Lender” site. Below you will find contact information on an Arizona lender who can help you in our fine State.

If you would like to search Fannie Mae’s inventory of HomePath authorized homes we’ve made it easy. Just use this link to our home search site.

If you are looking to buy a home there is an unprecedented level of first time home buyer incentives.

________________________________

We want to thank our lender buddy, Ron Hall, for providing this HomePath information. You can reach Ron at 623-293-6970 with your mortgage questions or on his web site: http://www.bncnationalbank.com/scottsdale/rhall.

Have a great weekend…

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

FHA Loans and Non-Permited Rooms and Additions

As we have mentioned in the past, FHA loan requirements have gotten tougher these days. One of the changes is when you are considering buying or selling a home with non-permitted rooms or additions. Our friend Jenna Hirth with PMAC Lending in California has provided us a little insight into the changes that can affect a real estate transaction where un-permitted work was performed.

Good Old Days- Up until a year ago if a property transaction had unpermitted additions or improvements we use to have the appraiser verify that the work was done in a “workmanlike manner” and give it no value on the appraisal report.

Reality with Current Market – Lenders and investors now are much more strict about properties with unpermitted areas. If the unpermitted area has any electrical, plumbing or heating that may pose a potential health and safety issue after the transaction closes, they will want the those items capped or removed. If there is lighting they would need to remove the fixtures and cap the electrical and if there was a sink added they would want removed and plumbing capped off. Once these corrections are made the appraiser would go back and inspect.

Of course when possible they can always try to get the improvement permitted. This is all about health and safety and marketability when the loans are sold and insured. If you come across a property with permit issues like these discussed, it would be a good idea to check with the city to see if and how long it would take to get a permit and if that won’t work contact the potential lender to confirm exactly what will be required for the loan approval.

Financing Option – Many lenders offer the FHA 203K Rehab loan that would allow a borrower to finance needed repairs and improvements that could also include items needed to obtain final permits.

Best to you in 2010,

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

Home Repair Tips of The Month... Your Home's Appliances

As Realtors, we always recommend home buyers hire a professional inspection service. Our long time favorite in the Greater Phoenix area is Advantage Inspection Service. They always performed great work and take as much time as needed to explain their findings to the homeowner-to-be.

They have begun a new service they call their Home Repair Tips of the Month. I called David Swartz, Advantage's owner, and ask him if I could re-post the email here on Urban Life and he said... sure thing. We will make this a monthly addition to the site, so check back at the beginning of each month for the next set of home repair and maintenance tips.

Simply click on the image to the right to see it full size and readable. Some browsers show the entire image, however, you may have to use the Ctrl and (-) keys to reduce the image size for better viewing.

Hope you and your home enjoy the fine tips they offer.

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

Advantage Inspection Service Contact Info:

8433 N. Black Canyon
Phoenix, AZ 85021
602-864-8331
arizonainspections@gmail.com (email)
www.azinspect.com/ (web site)

What is an LSR, Loan Status Report, used in Arizona real estate purchases?

Many people ask us, "What is an LSR?" We could answer lipolysis stimulated lipoprotein receptor, however, we think most people are referring to a real estate addendum called a Loan Status Report.

Simply stated, the Loan Status Report (LSR) is a standardized pre-approval letter a lender provides for purchasing residential real estate in Arizona. Prior to the creation of the Loan Status Report lenders would supply a pre-qualification letter that varied in content and quality of information. The LSR provides a form for information deemed important to both buyers and sellers of residential real estate.

Some ask if having an LSR is mandatory when financing the purchase of residential real estate in Arizona. It is only mandatory if one is using the ADRE Purchase Contract to write and submit your offer. Since most residential real estate purchase contracts are written using the ADRE form, a LSR is commonly required.

Below is an introduction video provided to help you better understand the LSR document. If you have questions about this or any document used in a real estate transaction, we recommend you contact qualified counsel.

We hope this post and video have been of help. If you have questions, know we are delighted to be of help.

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

How Long Does It Take To Buy or Sell A Short Sale Home?

NEWS UPDATE ON SHORT SALES: On November 6, 2009 we launched our new site dedicated to news and information about short sales. Go to www.short-sale-phoenix.com for all the news.

We often get the question, "How long does it take to buy a home advertised as a short sale?" We tell people it generally takes a minimum of two months and generally much longer to purchase a short sale property. Most clients have a hard time believing this time line is true; It simply does not make sense it could take so long.

I decided to gather some hard figures on recent short sale transactions so our readers could see first hand the reality we see day in and day out. I performed a search on ARMLS, the database that stores real estate transaction information for the Greater Phoenix Arizona area. The search criteria was pretty basic... homes that closed escrow since June 2009 and were advertised as short sales or pre-foreclosure. 

The search came back with 1290 transactions, thus giving us plenty of information to review. Forty-four homes were chosen from the list. You may wonder why 44... 44 was the number of lines on my notepad and offered enough data to give a sense of the market. 

The chart below shows the results of the study. As you can see, the fastest horse in the short sale race completed its journey in 61 days and one likely frustrated buyer waited 235 days to reach the finish line. The average transaction took about 100 days.

  

THE BOTTOM LINE: Short sales take as long as they take and many never reach the finish line. We've found some listing agents know how to get the job done and some don't. It is a complex course and strong skills and experience are needed to reach the finish line.

Below are a few things we've learned through experience and talking to other experts in the field that help move things forward:

• Make sure the offer you and your agent present is complete with all the applicable forms and signatures. An incomplete  package is often kicked back or not reviewed.
• Ask the listing agent if they are submitting one offer or multiple. One offer gives a potential buyer greater odds of closing escrow.
• Make your offer as clean as possible. Asking the bank to pay lender fees, HOA transfer fees, home warranty policies can make a difference. The bank is trying to loose as little money as possible.
• Know that short sales with multiple loans against the property will take more time.
• Some banks are faster than others. I can't post the actual names due to liability reasons, but the better agents know who plays ball and who doesn't.
• BE PATIENT

For additional information about short sales, please read our post, Short Sales...our opinion on buying one. 

We hope this information is helpful. If you have any questions, please feel free to give us a call or send an email.

Gene Urban
The Urban Team at Realty Executives
602-234-5777
gene@UrbanTeamAZ.com

Foreclosures Are Rising in Greater Phoenix Again

We just posted an article on our investment site, Real Estate Investing 101, looking at the rise in foreclosures in the Greater Phoenix market.

It is sad news for too many homeowners finding themselves in trouble. The upside is this does allow new buying opportunities for those with down payment dollars and decent credit. We are seeing a wide variety of bank-owned homes, condos, land and even commercial property coming on market.

You can read the entire article about the rise in foreclosures by clicking on this highlighted text.

Take care and know we are here to answer your real estate questions and concerns.

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