by Heather

Market Update through the end of October 2011. Please note that the Valley Wide graph represents all of the MLS.

(you can click on the chart to see a bigger version)

This chart shows you the percentage of distressed properties that are being listed and sold.

  • Short Sales represent 29% of the Closings for October (compared to 26% in September)

  • Short Sales represent 37% of the active Listings currently on the market.

  • Distressed Sales (Short Sales and REOs combined) accounted for 64% of the total sales for October.

  • The listing success rate for Short Sales is 60.0%!

Phoenix area housing statistics

Here are a few charts from the Cromford Report website that show the most current statistics on the Phoenix-area housing market. All figures are for metro Phoenix Arizona through the first 10 days or so of November 2011, and all types of housing (condo, detached home, patio/town home) are included.

These are charts for Days on Market and total dollar Volume of home Sales.

 

[caption id="attachment_9649" align="alignnone" width="300" caption="Days on Market, metro Phoenix AZ, Nov 2011"][/caption]

 

[caption id="attachment_9650" align="alignnone" width="300" caption="Total Volume of Sales, metro Phoenix AZ, Nov 2011"][/caption]

On the top graphic, you can see that time on market -- an indicator of both sellers picking the right price and buyers wanting to buy -- is dropping. That's generally a good thing, and it's watched as an overall indicator of market health. Three to six months on the market is considered about "normal"; more is a buyer's market, less is a seller's market.

The red line chart on the bottom graphic shows the typical bump in sales activity in the summer. But the blue line chart to the right shows that sales volume is higher year-over-year than this time last year. In other words, our summer sales growth left us at a higher point that this time last year, selling more homes overall.

Our buyers are writing multiple offers before getting one accepted, but sellers are still generally willing to pay closing costs.  What have you been seeing when you're shopping for homes? How many offers are you writing on homes before you get one accepted? Are sellers still willing to pay buyer's closing costs? We'd like to hear your feedback, please leave a comment.

 

FHFA's new program to help underwater homeowners

Today the Federal Housing Finance Agency announced a new program designed to help even more underwater homeowners refinance their mortgages at today's low rates. The plan hopefully will allow homeowners to lower their monthly mortgage payments, thus freeing up money to be spent in the broader economy and help the US from slipping back into recession again.


Previous programs had been restricted to homeowners who were no more than 125% upside-down on their homes. The new FHFA program places no cap on how much the borrower owes, or how far underwater they are.  Only mortgages backed by Fannie Mae and Freddie Mac will be eligible. Need to know if your mortgage is owned or managed by Fannie/Freddie? Check here and then here. Then call us for a loan officer recommendation.


Helpful links -

Does Freddie Mac own your mortgage?

Does Fannie Mae own your mortgage?

Rapidly dwindling inventory of bank owned homes in metro Phoenix

In his September 15th market summary Mike Orr of Cromford Report said




We are projecting about 4,500 new foreclosure notices during September, a drop of some 16% from August and about 2,850 trustee sales, a drop of about 21%. Part of the drop is because September has 9% fewer working days (21) than August (23).


Nevertheless it still looks like the foreclosure tide is on its way out, and the inventory of bank owned homes continues to fall, as does the count of pending foreclosures.



Context: In the 30days preceding Mr. Orr's report, there were 8,763 properties sold in the greater Phoenix metro region. As of September 20, 2011 there are 19,241 properties listed for sale in the area. Nineteen thousand, plus forty-five hundred, minus nearly nine thousand... equals not enough homes for sale in a mere couple of months.


You can sign up for the highly respected and frequently dead-on accurate Cromford Report for a nominal fee for a 3month membership. Last I checked I think it was $90 for 3 months. WELL worth it.


By the way, I completely agree with Mr. Orr. The foreclosure tide is on it's way out. My investors looking for bank owned homes in the under $125,000 price range are having a devilish time finding and getting the right home. Multiple offers, bidding wars, paying over asking price. If you're shopping under $75,000, triple that difficulty level.

Most expensive bank-owned home in Phoenix

It's located at the Biltmore Estates golf course. Got a cool $7 million? All 18,000 square feet of this mansion can be yours. It's only the market for 6 months, too, which in the land of luxury real estate is about 1/10th of a second.

Last December (was that a mere 10months ago?) it was listed for $12,500,000. Talk about market decline! That's a drop of nearly 1/2 in 10months.

Here's some pictures of the compound...

Her closet

His closet. And, his library ... Clearly, the man who owns this home is A Very Serious Man who makes a lot of Very Serious Money.

The wine cellar (frankly, the way the photographer shot it, it looks more like an M.C. Escher drawing to me)

2 washers and 2 dryers. Because everyone knows the Very Wealthy have Very Dirty Clothes.

Apparently, the sheer weight of the former owners' wealth bent the space-time continuum in the ceiling of the master bedroom.... I'm a little dizzy looking at it.

Enjoyed these photos? See more foreclosed homes of the formerly Super Wealthy, elsewhere on our blog. And if you're actually shopping for a home in this exclusive price range, don't hesitate to call me. I actually do have regular experience helping buyers in the luxury markets in metro Phoenix, Arizona. I promise to keep my mild snarking to myself when we're home shopping.

Condo financing near-impossible to get

A while back, I wrote a piece called Condo Re-Financing: Tricky to Impossible. Nowadays, that lending dilemma has grown -- it's next to impossible to get a new mortgage to purchase a condo, according to my favorite lenders Kevin Reiser and Jeannie Bolger. (need an ace loan officer? call me or text me and I'll forward their info. 602-999-8831). The exception may be luxury condos, think million dollar plus, but I'm not sure that mortgage market is healthy either.


The reason one can't get a mortgage to buy a condo these days has almost nothing whatsoever to do with the buyer and his/her credit profile. It has to do with the condo community and it's overall financial health/outlook. Many, many condo (and patio home and townhome) communities have experienced so many foreclosures that their Homeowners Associations are in severe financial distress. Other times, the owner-occupant to investor ratio is so out of whack - with investors owning 75% or more of the units in the community - that lenders won't lend to anyone who wants to buy there.


If you're really digging the idea of a condo right now.... check with several lenders first. Getting a mortgage for your new, hip pad might be tricky to impossible.


Want more in-depth explanation of the metro Phoenix condo market outlook? Try this article we wrote waaaay back in Spring 2010. http://thephoenixagents.com/newsletters/viewpoint-2010-0407/

Mortgage rates lowest since 1971

Mortgage rates set new record lows this week, per a report by mortgage giant Freddie Mac (the Primary Mortgage Market Survey), hitting rates not seen since 1971.

Rates on 30-year fixed-rate mortgages averaged 4.12 percent with an average 0.7 point for the week ending September 8th, 2011.

Despite the fact that it’s been 40 years since we saw mortgage interest rates this low, the Mortgage Bankers Association simultaneously reports that buyer demand for mortgages remains at record lows, close to the low demand levels last seen in 1996.

(some content above based on original reporting published on Inman.com; chart below originally published by the New York Fed)

30yr mortgage rates from 1970 to 2010

Desert Ridge Market Update

The Desert Ridge area is located in the far North Central section of Phoenix, and covers several new-ish neighborhoods just north of the Loop 101 freeway, between Scottsdale Road and Cave Creek Road.


Most housing in the Desert Ridge area was built between the mid 1990s and the early 2000s.  Almost all housing is wood frame covered by painted stucco, with concrete tile roofs. This is standard for construction in this age range. While most homes built were single-family detached, there were a few condos and townhomes built as well.


There are several factors that make the area desirable to many buyers:

  • Beautiful views of the surrounding mountains, with nearby hiking  recreation areas;

  • A gigantic shopping mall at the intersection of Tatum Road and the Loop 101; and

  • The area lies within the Paradise Valley school district, widely believed to be the best in the metro region and possibly the best in the state


Homes for Sale in Desert Ridge

  • Active Listings: 29 homes (view these homes)

  • AWC Listings: 8 homes (what is AWC?)

  • Pending Listings: 18 homes

  • Sold Listings, past 90 days: 35 sales


Desert Ridge Price Information

  • Average List Price: $152.23 per square foot (last update: $150.90/sf)

  • Average AWC Price: $128.81 per square foot (last update: $125.29/sf

  • Average Pending Price: $136.31 per square foot (last update: $135.74/sf)

  • Average Sold Price: $130.60 per square foot (last update: $134.33/sf)

  • List Price to Sold Price Ratio: 107.21% (last update: 96.82%)


Average Days on Market for Desert Ridge homes = 64 days (last update: 121 days)

Popular Desert Ridge area Home Searches:

How many REOs are selling in metro Phoenix?

From our own local God of Statistics, Mike Orr of CromfordReport.com, a breakdown of the market share of each type of home, as of August 16, 2011.



REO sales across Greater Phoenix (all types) averaged $59.26 per sq. ft. (down 0.9% from July 16). They gained market share, moving from 43.9% to 44.2%.

Pre-foreclosures and short sales averaged $73.78 (up 3.1%). Short sales and pre-foreclosures were the losers this month, moving from 24.1% to 23.2% after a strong spike at the end of June.

Normal sales averaged $105.32 (down 3.6%) and they gained a little market share, moving from 32.0% to 32.6% of sales.

Definitions


REO = (other) Real Estate Owned -- these are foreclosure homes where bank has already repossessed the house from the former owner. In Arizona, there is no "redemption period" after the foreclosure wherein the former owner can reclaim the house.


Short sale = owner still owns the house, is probably facing foreclosure, and is trying to sell at today's market prices which will not pay off the entire mortgage balance(s). This seller must get his/her lender's approval on the sale or the sale will not happen.


Equity sale = this is a "regular" sale where the owner owns the house free and clear, or at least has equity in the home. This homeowner - if he has a mortgage - can sell at today's market values and still pay off the mortgage in full.



Need more information?


Need more info? Want to talk to a  professional about your housing options? Contact us by phone, email or text. We're licensed, professional Realtors in metro Phoenix and are happy to help you with no sales pitch and no high pressure sales tactics.


Heather Barr - 602-999-8831 or NorthPhxAgent@gmail.com
Chris Butterworth - ButterDad@gmail.com

Moon Valley market update, August 2011

Moon Valley is located in North Central Phoenix, and covers the mature neighborhoods between Thunderbird Road and Bell Road, and between 7th Street and about 15th Avenue.

Market-Update-moon-valley-mapHomes for Sale/Sold in Moon Valley

  • Active Listings: 11 homes (view these homes)
  • AWC Listings: no homes (what is AWC?)
  • Pending Listings: 3 homes
  • Sold Listings, past 90 days: 8 sales

Moon Valley Price Information

  • Average List Price: $330,820
  • Average AWC Price: $N/A
  • Average Pending Price: $234,970
  • Average Sold Price: $199,875

List Price to Sold Price Ratio: 90.13%
Average Days on Market for Moon Valley homes = 76 days

Popular Moon Valley area Home Searches:

“Information in this article is based on single family home sale information from the Arizona Regional Multiple Listing Service (”ARMLS”), for the period up to August 21, 2011. ARMLS does not guarantee information accuracy.  Data maintained by ARMLS may not reflect all real estate activity in the market.”

Short Sell your Phoenix home

If you're underwater, you're in a very crowded, very unhappy club. Possibly tens of thousands of Phoenix homeowners are underwater. Whether you bought too much house, or carefully avoided over-extending yourself; whether you borrowed equity for vacations or for home improvements... sometimes through no fault of your own, you're underwater on your home mortgage.


If you're thinking about walking away, or about trying a short sale, you almost certainly need a lawyer's help through the process. You're going to need a Realtor too, because you're in a double whammy situation:




  1. You have a real estate problem AND

  2. You have a legal problem


The real estate problem is obvious: you need to pay somebody something in order to get your home listed in the MLS (Multiple Listing Service) so buyers can find it online. Moreover, the paperwork involved in a short sale is so bloody complex you're going to want to tear your hair out before it's all over. Hire a professional Realtor who handles short sales regularly, and let them do some of the hair pulling. The Realtor's fees are going to come out of the proceeds of the sale anyway, so it'll end up costing you nothing (or next to nothing, depending on your situation) to have an experienced professional Realtor handling your listing, marketing and sale. Lucky you! We're Realtors and we have people at our brokerage who do nothing but short sale listings and closings. Contact us for more information.


The legal problem is a little harder to grasp. Think of it this way; your mortgage is a contract. When you walk away or attempt a short sale, you're breaching a contract. And your mortgage was probably the single most valuable contract you'll ever sign in your entire life. Breaching that contract shouldn't be undertaken without professional advice.


You know that the banks have scores of lawyers on staff, protecting them when their mortgage contract is breached. You should have at least 1 attorney in your corner. Best of all, the attorney's fees are generally going to be paid for out of the proceeds of the sale of the house, not out of your pocket.


So, to boil it all down: you can hire 2 professionals - a Realtor and an attorney - to guide you through the short sale process, and in almost every case, it won't cost you a dime out of your pocket. It's a win-win.


Contact us for advice about listing, marketing and selling your home. We'll also hook you up with 1 or 2 of our trusted, tested local attorneys who specializes in short sales.


Disclaimer: this article was written about metro Phoenix, Arizona homes sales in the Summer of 2011. If you're reading this article from far away, or long after the fact, consult a professional in your area!

Scottsdale home values, 2006 to 2011

We're busy here at The Phoenix Agents, so today's post is short and sweet. This is a chart that shows annual median home sales prices in Scottsdale in 2006 (red line) and to date in 2011 (pink line).



  • In 2006, Scottsdale homes started the year at $575,000 (far left of red line) and finished the year at $638,000 (right side).

  • In 2011, Scottsdale homes started the year at $385,000 and fluttered down to $365,000 by the end of July.


Keep in mind these are annual median prices, so they're a lot "flatter" than monthly median or weekly median prices, which show lots of volatility. There's also a somewhat false downward pressure on the median price, because the bulk of homes that do sell are bank owned or short sales and those sell for lower prices than equity sales. Finally, even in relatively wealthy Scottsdale, investors are finding bargains, and they tend to buy at the lower ends of the price range.

Still, this chart is a pretty good visual of the rollercoaster ride we've all been on in the past 5 years.


Underwater in Scottsdale. Do you need a lawyer for a short sale?

For a number of years, many homeowners in tony Scottsdale thought they would be insulated from the real estate crisis. For years, they were right. Not any longer. In general, Scottsdale median home prices are down about 43% from their peak in late 2006. Many Scottsdale homeowners are "underwater", owing more on their home than it's currently worth.


Are you underwater on your home? If you plan to stay in your home for another decade or so, and you can still afford the fixed-rate mortgage payment, this might be no big deal. It depends on your financial situation. You might be able to ignore the dismal media headlines, love your house, raise your family, pay your mortgage and live your life.


But if you have other financial issues compounding your housing value issue, you might need to think about your options. We here at The Phoenix Agents strongly recommend you retain an attorney. As Kevin Hardin of  Thomson Conant law firm says, "you don't have a real estate problem, you have a debt problem."


Your mortgage is a contract and if you're thinking about walking away or trying a short sale, you're actually contemplating breaching a legal contract. You're going to want a lawyer to help you do that.


Don't be fooled by people who casually toss around the phrase, "Arizona is a non-recourse state."  What they mean is that in general, a mortgage lender can't sue a homeowner after a foreclosure. But there are serious loopholes in that law, and the biggest loophole applies to short sales. Arizona's law covers foreclosures, not short sales. There's also a giant loophole on the topic of second mortgages and equity lines/loans.


If you short sale your home without getting precise language in the Short Sale Agreement from your lender, you might be leaving yourself wide open to a gigantic lawsuit for many years to come.


We happen to know several great short sale and foreclosure attorneys and accountants. Give me a call and I'll give you their names and numbers. Once you've spoken to an attorney, if you're ready to try a short sale, we'll help. Our broker has several agents on staff who focus on short sales and have remarkable track records of success.


Heather Barr, Realtor
The Phoenix Agents at Thompson's Realty
602-999-8831   or Heather@ThePhoenixAgents.com


 

Mortgage interest rates plunge on debt deal news

From one of my favorite loan officers, Gary Ogami at Pinnacle Peak Lending, Inc. comes the news that mortgage interest rates just hit year-long lows:

…rates are now at the year’s lows, and are only slightly above the all-time lows we saw almost one year ago.

The passage of a debt ceiling and deficit reduction agreement, along with weaker than expected manufacturing and GDP figures, bonds have rallied as investors have sought safety.  This has lead to higher bond, and more importantly, mortgage-backed securities (MBS) prices, which have brought yields and rates lower.  The last time we approached this price level for MBS’s was late summer/early fall of last year!

Mortgage Term Rate APR
30 Yr Fixed 360 months 4.250% 4.297%
15 Yr Fixed 180 months 3.625% 3.736%

 

Are you looking for a mortgage loan officer? Try Gary, I highly recommend him.

Gary Ogami
Pinnacle Peak Lending, Inc.
gary@pinnaclepeaklending.com

He’ll get your pre-qualification on the fast track and meanwhile you can start searching for homes on our MLS SearchContact us with any questions and when you’re ready to hire a Realtor!

Are the ‘assessed value’ and market value related?

In short, the answer to this question is “no”.

Disclaimer: this answer applies to metro Phoenix, Arizona in the year 2011, where I work as a full-time Realtor. If you’re reading this long after publication or from another location, please consult a professional in your area. In other words, I am a Realtor but I am not your Realtor… yet. Wanna hire me to be YOUR Realtor? Click here.

Lots of buyers want to use the Maricopa County Tax Assessor’s “Assessed Value” to justify why they should be able to buy a particular house for less than the listing price.  This is especially common among folks who are engineers, attorneys or other Type-A’s.

Listen up, Type-A’s! I feel your pain. I understand your need to get your hands on hard data, statistics, charts, graphs, etc.  Thing is, the market value of houses has to do with 1 thing, and only 1 thing: what are other buyers currently paying for other, similar homes?

Here’s a very brief comps analysis on a particular HUD home currently listed for sale in North Phoenix. To begin, this is the tax assessor’s notice of valuation on the home. For tax year 2011 the assessed value is $147,500:

Capture, tax assessor valuation on 1727 E Blackhawk (click to enlarge image)

This home has 2,425 square feet built in 1995 with a pool in the backyard, and the lot backs up to mountain preserve. The home is currently listed for sale at $240,000.

Whoa, tax assessor says only $147,500. What gives?!?  Here’s the comps on 4 sales within the past 60 days of the same size and similar condition homes in the subdivision:

Capture, CMA on 1727 E blackhawk (click to enlarge image)

Notice that all 4 of these homes were on the market for less than 40 days before finding a buyer – the market’s moving pretty fast. One home has yet to close, and it’s included as a possible indication of where prices are headed. Look at the column titled “SP” for “selling price”. Comps on this home range from $235,000 to $276,500.

In other words, other buyers have very recently paid between $235,000 and $276,500 for very similar homes in similar condition, located very close by. Therefore, the market value on this home is somewhere in the mid-$200,000s. If you make an offer of $147,500 you will be wasting your time.

Don’t fall into the trap of looking at the assessed tax valuation when trying to judge how much a house is “worth”. It’s worth what buyers are willing to pay for it. Get yourself a competent Realtor (hey, I know what of those… wait, I am one of those; hire me!)

Thanks for reading; come back soon!

Most expensive REO

Here it is, folks, the most expensive REO bank owned foreclosure home currently for sale in the metro Phoenix, Arizona MLS database. For a mere $18 million, this estate can be yours.

18mil EF

Seven bedrooms and 10 bathrooms, and over 17,000 square feet of living space. The home boasts two swimming pools, a billiard room, 3 family rooms, a theater room with actual movie-house projection system and seats that move with the movie action. Garage space for 21 cars. Home has an exercise room and a piano room, 2 libraries, and it’s own solar electric generating station.

The closets in this place will suit turn anyone into a clothes horse…

18mil closet218mil closet1

The house sits on 5 acres in Paradise Valley, on prestigious Mockingbird Lane.  Want to see it in person? Shown by appointment only; bank references required prior to showing. That’s Realtor-speak for “show me the money before I show you the house.”

18mil HALL18mil ENTRY

18mil POOL218mil POOL1

18mil LIBR

And, proving that even the excessively wealthy have sense of humor, at the entrance to this home’s theater room, Zoltar from the movie Big.

18mil THEATER

AMC Esplanade 14 movie theater will re-open as posh Fork & Screen

fork and screen logoBiltmore-area movie-goers have undoubtedly noticed that the  AMC Esplanade 14 movie theater at 2512 E Camelback Road has been closed down this summer.  In August, the Esplanade will reopen as the latest site of AMC’s newest concept, the upscale Fork & Screen.

With this renovation, AMC is trying to attract the posh “dinner and a movie” crowd to the Biltmore location. The new movie venue will offer luxe décor, top-shelf cocktails, wait staff and bartender service and even private suites in which to watch the movies.

Oh, and for all you jobseekers out there, AMC is currently hiring wait staff, bartenders, back-of-house people (dishwashers, cooks, etc), and even a theater manager. Search available openings on CareerBuilder.com, using the employer name “TD-AMC Dine-In Theatre”.

Sources & Links for this story:

http://www.amctheatres.com/dinein/forkandscreen/

http://blogs.phoenixnewtimes.com/jackalope/2011/05/amc_esplanade_14_fork_screen.php

California says "no" to lender lawsuits after short sales

Holy cow! The California legislation just passed a law preventing banks and other lenders from suing homeowners for unpaid mortgage balances after the lender agrees to a short sale. (hat tip, Kris Berg of the San Diego Castles blog). The way I read it, the new California law also prevents the lender(s) from requiring the homeowners to pay a lump-sum settlement at the short sale closing.



[The California legislature just passed into law] Senate Bill 458, prohibiting a deficiency after a short sale for one-to-four residential units, regardless of whether the lender is a senior or junior lienholder. ....  Both senior and junior lienholders cannot require a borrower to owe or pay for a deficiency in a short sale. This law also prohibits any deficiency judgment to be requested or rendered for senior or junior liens after a short sale of one-to-four residential units.

Click here for Reuter's coverage of the event


Click here for a roll-call vote tally of the California Senate, to see who voted for, and against


Will it ever happen here, in metro Phoenix? Don't count on it. Politically, Arizona is far more "red" than California. Some years we're purple, but we've got a very, very long way to go until we're as blue as California.


Note to Arizonans:  Arizona does not have a law on the books yet that protect homeowners in these kinds of situations. In Arizona you can be sued by your 2nd lender for the unpaid 2nd mortgage balance, for up to several years after a short sale, even if the lender gave permission for the short sale! So what should you do if you're underwater, considering a short sale, and have a 2nd mortgage or equity credit line/loan? Call an attorney! Call or email me and I'll be happy to refer you to the attorneys who handled my short sale.