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Arizona Real Estate Finding a Trough

Brandon — Tue, 19 May 2009 00:07:55 +0000

The Phoenix real estate market might be starting to find a long trough in home values. This means two things:

Home values are starting to stabilize
Home values are going to remain stagnant for some time

I believe the market is in the initial phases of finding a so called ‘bottom’ and we could be on the cusp of seeing home values starting to stabilize. In some of the hardest hit areas of the valley where prices have fallen 70%, properties are selling fast with multiple offers. There are many investors and secondary home buyers that are paying cash, which is helping the appraised value of comparable properties. Also, if lending will loosen up a little bit and find a happy median between two extremes, we could really start to see more qualified buyers enter the market.

On the flip side, there are a lot of homeowners that are under water and are in preforeclosure. I believe this trend will continue for another 16-24 months which will more than likely keep any appreciation of home values at bay.

For first time homeowners, it is a great opportunity to take advantage of a $8,000 credit from the Gov. If you are an investor, cash flow is back for rental properties, but requirements of a minimum of 25% down is a little hard to swallow.

A key factor for many secondary home buyers and people looking to upgrade is to take advantage of the low interest rates. With so many dollar bills being printed, it is only a matter of time before inflation sets in and interests rates begin to creep up. I would expect this to happen by 4th quarter 2009 and into 2010.

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Spring Season Real Estate Rush?

Brandon — Tue, 17 Mar 2009 14:44:01 +0000

Yes, it’s that time of year again here in the Phoenix Valley for the real estate market. Our market typically (the key word here is ‘typically’) starts to pick up in early to mid March as temperatures consistently start to hoover in the mid 70’s to low 80’s.

Am I seeing increased activity right now? Absolutely! It was been a busy past two weeks as buyers are starting to get off the fence and take advantage of the depressed market. This is especially true with bank owned foreclosures and short sales. I think this trend will continue through the spring, however the real question is if it is sustainable?

I am encouraged by what Bernanke said on the recession ending in 2009, Citigroup being profitable in the first two months of 2009 and also I’m starting to see the Obama foreclosure prevention plan limit the number of homes being foreclosed on. The first place these foreclosures show up is at trustee sales and lately the inventory has been slim with a lot of postponements. It is a simple supply and demand issue for prices to start going up…and if the supply is dropping and the demand is increasing, then prices will find the bottom.

Lastly, I think the Phoenix real estate market will start to recover before a lot of other areas in the country. This being because our market started declining before a lot of other markets (late 2005) and we now have builders that are not in play anymore as well as a consistent population increase…all good things.

Indicators of When the Phoenix Real Estate Market Will Hit the Bottom The big question for real estate professionals in 2009 is...
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Barking Dogs + Real Estate = Not Good

Brandon — Mon, 09 Mar 2009 15:20:07 +0000

So I have a dilemma. On one side I have this beautiful home that has been rehabbed and shows beautifully that I’m trying to sell. On the other, literally the other side of the house, I have a neighbor that has weeds as tall as the empire state building and two furious sounding dogs that scare the bejeebies out of prospective buyers. I wouldn’t buy a house next door to a neighbor that neglects his/her property with barking dogs, would you? So what do I do?

Well first off, I kindly knocked on the door to ask if I can have my landscaper (free of charge to the neighbor) spray the weeds and hall out the two dozen tumbleweeds in the backyard. After many failed attempts on getting someone to answer the door, other than the pitbills that were tearing up the front blinds, I decided to contact the HOA to get the owners telephone number.

Two days later, I get a call from the neighbor and I explain to him that I’m just trying to help improve the neighborhood by getting ‘top dollar’ for my listing and that from the upstairs master suite you get a great view of the tumbleweeds in the backyard. Long story short, the neighbor agreed to letting my landscaper come over and take care of the landscape. Believe me the $80 I spent on the neighbors backyard was the best investment for the home I’m selling!

Now that I got the landscape issue addressed, what do I do about the barking dogs???

Ok, so I did do a little research and made a couple phone calls to Petsmart and Petco. There suggestion is this ultrasonic outdoor barking control device seen on the left. I should stop right here and just mention, that I’m a HUGE dog lover as I have a mini-farm at my house with two dogs and a cat. With that said, should I give this device a shot? I mean, I’m sure all the neighbors would be happy if the dogs barked a little less. So, I’m leaving it up to you - whatever the final vote is, i will do.

Note: There is a poll embedded within this post, please visit the site to participate in this post's poll.

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Homeowner’s Affordability and Stability Plan

Brandon — Thu, 05 Mar 2009 14:07:42 +0000

Enclosed is an outline from Security Title Company for the new Homeowner’s Affordability and Stability Plan that was unveiled in Mesa on February 18th. This PDF packet discusses options for borrowers both current and behind on their mortgage payments, those facing reduced income or job loss, those who are upside down on their mortgage, and those at risk or facing imminent foreclosure or payment default.

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Information on Bank Owned Homes in Phoenix

Brandon — Wed, 04 Mar 2009 23:25:12 +0000

Since 23% of homes on the market are bank owned foreclosures in the Phoenix Metro Area, a lot of buyers have questions about how a real estate transaction works on these homes. Realistically, there are more similarities than differences when you compare the transaction to a traditional for sale property. The main difference is that the seller’s of these foreclosures are banks and not a person.

Here are few tidbits of information on bank owned homes:

In order to ‘make an offer’ on a bank owned property you will need a loan status report (it’s like a pre-qualification letter) or proof of funds if you are paying cash.
The property is sold ‘as is’ and the bank will not provide a seller’s property disclosure (SPDS) or homeowners insurance claims historty report (CLUE).
The bank usually takes up to five (5) business days to respond to an offer. They can either accept, decline or counter offer.
An average close of escrow for a bank owned home is 25-40 days.
There is a ten (10) day inspection period upon acceptance of a contract. This time period allows buyers to inspect the property for material defects. However, be advised that the bank will make no repairs to the property. (hence ‘as-is’). Upon expiration of the ten day inspection period your earnest money will become ‘hard’ unless there is financing issues and you can no longer qualify for the loan.
Foreclosures in the Phoenix area are selling for an average of 97% of the asking price. Therefore, you should have realistic exceptions on how much of a discount you can expect to get off the list price.

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Would You Counter an Offer Over $1,000?

Brandon — Tue, 24 Feb 2009 18:25:14 +0000

I received an offer for one of my listings on 118 Canyon Rock and we went back and forth with three separate counter offers - not to mention 2 verbal counters. All along we were sticking to our price of $114,950 which is $5,000 below our list price, and they (the buyers) came back with a counter offer of $114,000. So essentially, they were countering over the difference of only $950.

So my question to you is… would you counter in this scenario? I mean $950 dollars isn’t pocket change, but does it seem too petty in the big picture?

Note: There is a poll embedded within this post, please visit the site to participate in this post's poll.

What did I do, you ask? I put the deal together at $114,450 like a good penny-pinching matchmaker would do…

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The Final Piece of the Staging Puzzle

Brandon — Mon, 23 Feb 2009 20:52:52 +0000

TA DAH! I finally put the complete staging package together for my vacant listings. I have everything including pictures, modern furniture, decorative knickknacks and even air fresheners, but there is one thing I am missing. Here is my latest flip project in Gilbert’s Power Ranch community - can you find out what I’m missing?

Anything? Well, what I’m missing can’t been seen or touched, but only felt deep in a buyer’s soul. Yep, that’s right, Kenny G! The last piece of my staging puzzle is now complete with Kenny G playing the saxophone on light jazz 95.5 FM for prospective buyers. I picture it like those crazy guys playing the flute for snakes that come out of the woven baskets. You know what I mean? However the crazy guy is Kenny G with the woven baskets being buyers pockets and of course the snakes being money. Play on Kenny!

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Canadians Attracted to Fireside at Norterra

Brandon — Sat, 21 Feb 2009 14:30:08 +0000

With the deflated home values in the Phoenix Metro Area, a lot of Canadians have been flocking to the Valley to pick-up some good bargains. Most of the traffic I have seen is coming from the Canadian Province of Alberta with the major cities being Edmonton and Calgary. This is obviously due to the region’s oil rich grounds and the short 2-3 hour flight to the sunshine in Phoenix.

In my experience, there seems to be a draw for most of these clients to master planned communities that offer amenities such as, golfing, workout facilities, community pools, hiking and biking trails, etc. Some of these communities include, Estrella Mountain Ranch, Vistancia, Seville, Grayhawk, DC Ranch and a community that I think is a hidden gem, Fireside at Norterra.

Here is a video tour of Fireside at Norterra:

The master planned community of Fireside at Norterra is a perfect for second homes and offers a ton of amenities, plus it’s only a short 30 minute commute from the airport and 10 minutes to Scottsdale. Moreover, the community is developed by respectable Phoenix area home builders, Pulte and Del Webb.

Should you need more information on the community of Fireside at Norterra you can visit this website or feel welcome to contact me.

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Active Homes on Phoenix MLS

Brandon — Tue, 17 Feb 2009 18:10:21 +0000

This pie chart shows that 45% of homes for sale in the Phoenix Metro Area are distressed!

This does not factor in homes that are not put on the MLS and go into foreclosure. Therefore, the number of homes that are distressed in Phoenix Arizona is a lot higher than what I can quantify. FYI: Here are the actual numbers:

28,372 Traditional For Sale
11,412 Short Sales
11,798 Bank Owned

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Data for Homes Selling in Phoenix Arizona

Brandon — Mon, 16 Feb 2009 14:56:56 +0000

The chart below illustrates homes that have sold in the Phoenix Metro Area over the past 6 months. This graph depicts the relationship between the median price a home is listed for (per square foot) and what the home has sold for.

As you can see, bank owned homes have the best pricing per square foot ($85.42), however you can expect to pay the closest to the asking price on these bank owned foreclosure with homes selling at 2.54% less than list price. You can expect to negotiate a bit more off short sales with the an average of 3.98% off list price and 6.66% respectively for traditional for sale properties.

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