The number of active listings in the Phoenix real estate market remained relatively constant for yet another month. The drop in the number of listings was only 587 listings from March 1st to April 1st. The big news expects to be the total number of homes sold for March 2010. It looks as though home sales may approach the 9,000 mark, making March the biggest residential sales month since last July.

Read the chart this way:
“Residential listings in The Phoenix area totaled 34,461 to begin April 2010, a drop of 587 from March. 14,087 of those listings are foreclosure listings (bank owned or REO properties and short sales). Foreclosures make up 40.9% of the total listings.

Talk of “shadow inventory” still looms on blogs and in the news.

The second chart shows the breakdown between the normal listings and the foreclosure listings. Read the chart this way:
“20,374 listings are “normal listings that have been on the market for an average of 172 days. 14,087 listings are foreclosure listings that have been on the market an average of 102 days.”

Short sales have dragged that number higher as bank owned homes slip off the market much sooner than short sales in Metro Phoenix. Real estate with short sales continues to be an adventure.

Short Sale Roulette

Phoenix Real Estate Blog Feed

I constantly get buyer clients asking me about the pros and cons of short sales. In fact, I’ve received so many questions I created a short sale page on my website and I refer clients to that page.  I’m sure I’m not the only realtor who has done that in this market.

I’ll tell you that I’ve had my share of successful short sales, both on the selling and buying side. I’ve also had my share of short sales that have blown up because 1.) a HELOC demanded a promissory note and the seller refused to sign it OR 2.) a bank wouldn’t let go of an unreasonably high BPO. [Side note: If the realtor who did the BPO for my short sale on Desert Cove Rd in Glendale is reading this -- your BPO WAS too high and the house sold for $10,000 less as a REO] Since I have a fairly analytical mind (which can be a curse in a marriage) I decided to see if I could figure out the statistical probabilities of a short sale closing escrow.

My bachelor’s degree is in business administration and I did well in quantitative analysis.  However, I did not want to create a thesis.  I was just seeking a simple way to convey the success rate of short sales to my clients. Here’s what I came up with: divide the number of closed short sales in one month by the combined total of the closed short sales plus the canceled short sales.  Expressed mathematically:

closed short sales / (closed short sales + cancelled short sales) = % of success

I used only canceled short sales and not those that “expired” or were “temporarily off market.”  I reasoned that expired short sales could simply be re-listed, were generally caused because the listing realtor lost track of time, and that most of them received an extension.  I did not count those that were “temporarily off market” because they would probably end up as either closed or canceled.

Here’s my conclusion based on 12 months of statistics from the Arizona Regional Multiple Listing Service: There is a slightly better chance closing a short sale than winning at a roulette table. Remember that roulette has a 50% chance of winning if you play either “odd/even” or “red/black.”

The 12 month chart shown below illustrates that an average of 53.7% of short sales close. Read the chart in this manner: “4,150 foreclosures sales (bank owned and short sales combined) occurred in February 2010.  1,438 of those sales were short sales.  1,167 short sales were canceled in February 2010.  Therefore, 55.2% of short sales were successfully closed in February 2010.” You will also note that the success of short sales has been greater in the last six months than in the first six months of the period.

As of 3/15/2010

I can already hear all of the short sale experts across America claiming a much higher success rate.  I have a higher success rate too. However, I present these numbers for your information or your humor — whichever you prefer.  Actually, I kind of like the roulette analogy and have already used it twice today.  Next time a client asks you if they should consider buying a short sale say to them “red or black?”

Selling Your Home

Home Buyers, Mortgage, Inspectors, Credit

Phoenix Real Estate sales were up 14% in February 2010.

February only had 28 days, but that was enough time to beat January’s total home sales in Metro Phoenix. Real estate residential sales increased from 5,812 in January to 6,613 home sales in February 2010. Need we ask why? The answer continues to be last minute shopping for the tax credit fueled by low interest rates. Expect more of the same during the next few months.

Read the chart in this manner: 6,613 homes sold in February in Metro Phoenix . Real estate defined as "normal" sales (not bank owned property or short sales) accounted for 2,463 sales, or 37.2% of the total. 4,150 sales were foreclosure related which comprised 62.8% of the total.

Here’s another interesting statistic. Year over year sales, commonly known as YOY (a common industry comparison standard), have been up for 21 consecutive months (not completely shown by the chart ). YOY essentially compares the sales in February 2010 to the sales in February 2009, the sales in January 2010 to the sales in January 2009, and so on. In other words, Phoenix real estate sales have consistently been improved from the previous year.

It’s also interesting to note that foreclosures (bank owned or REO property and shorts sales) officially accounted for over 1/2 all sales in the Phoenix real estate market beginning in October 2008. They have surged as high as 75.9% but have yet to drop below the 50% mark. My chart goes back to June 2007 for anyone who wants a longer term perspective.

My next post will evaluate the number of foreclosure sales and their makeup in terms of how many were lender owned properties and how many were short sales.

Phoenix Real Estate Forum

Tempe, Scottsdale, Mesa, Glendale, Chandler, Gilbert, homes

Homeowner Rights, Phoenix Foreclosures, Eviction Laws, and Forcible Detainers

A Forcible Entry and Detainer is an action that a new property owner (the foreclosing bank) can take if the existing occupant refuses to leave after appropriate notice (90 day notice of Trustee Sale)in Metro Phoenix. Foreclosure occupants could be either a tenant or original owner of property that was sold at a Phoenix foreclosure or trustee’s sale. Foreclosure eviction laws are subject to change, but this article is current In Arizona as of March 2010. This article was prepared with the help of a good friend, Georgi Stratton. Her contact info is on the bottom of the post.

[Note: more research was done after a comment from John, seen below. Reference this article to see how a part of the government may be breaking the law : Fannie Mae blantantly violating protecting tenants at foreclosure act]

The tenant/occupant receives a written demand to vacate the property. The term of the period to vacate is dictated by the type of occupancy – whether commercial or residential and whether a tenant or an owner that was foreclosed on. This term normally is either 5 or 7 days, unless the contract states otherwise. After the 5-7 days expire and the tenant/occupant still refuse to leave then a complaint for a forcible detainer action can be filed. The statutes provide for a very short notice period before a
court hearing.

The sole issue at the court hearing is whether or not the tenant/occupant has the right to possession. If they do not then they will be found guilty of a forcible entry and detainer. The court will enter an order directing the tenant/occupant to vacate within 5 judicial days. After that period has expired the Sheriff’s office can then evict the tenants/occupants, remove their personal property and give the rightful owner possession and control of the property.

It would be wise for the rightful owner to change the locks and take steps to protect the property.

Typically the seller must vacate the home within 7 to 14 days after a Trustee Sale (auction). Often the bank will offer the homeowner a $1,000 – $2,000 relocation fee if the homeowner moves within several days and leaves the home is good condition. If a foreclosed homeowner in the Phoenix area is being forced out without a moving fee or several days to move, the homeowner has rights. Inform the lender’s representative that you request a moving fee or are requiring them to file a Forcible Entry and Detainer Action. If they refuse to comply with either of these or if you feel your rights are being infringed upon, contact the local Sheriff for enforcement of current metropolitan Phoenix foreclosure eviction aws.

If the lender has to file a Forcible Entry and Detainer Action, you will not be able to get any cash for moving expenses.

Georgi Stratton
,Paralegal – Director of Short Sales,
Winsor & Coleman, PLC
Direct: 480.695.6565
Fax: 480.699.8853
Email: georgistratton@yahoo.com

Phoenix Foreclosures 41% of Active Market

Phoenix Real Estate

Arizona Mortgage Lenders

Phoenix Foreclosures

Metro Phoenix foreclosures still 41% of active market

The number of active listings and number of Metro Phoenix foreclosures remained virtually unchanged from February to March of 2010. As seen in the chart, listings hit a several year low in September 2009.  They have been gradually increasing since that time.  The chart also indicates how far active listings have dropped since 2008, thereby accounting for the swing in the market from a complete buyer’s market to a market that has evened out.  In some locations around the Valley the market is
even closer to being a seller’s market because of extreme competition for low priced Metro Phoenix foreclosures.

Search Phoenix Foreclosures

Phoenix Real Estate

10 years of Phoenix Real Estate

I love Tempe and have an affinity for the sales trends of Tempe Homes. Our brokerage is headquartered out of Tempe, AZ just 2 miles from Arizona State University. Tempe is filled with history, great neighborhoods, entertainment, sports and a sense of community.  Not only that, it’s centrally located with many of the valley’s main freeways passing through or around it. So down to business.

Tempe, along with Scottsdale and Paradise Valley, were three of the cities that withstood the rapid depreciation we experienced during 2007 and 2008 for the longest period of time. Perhaps saying they withstood depreciation is not entirely accurate. It’s more accurate to say they maintained higher values than most  surrounding Phoenix communities. Let’s talk about the below chart provided by the Cromford Report™.  

The meter in the upper left hand corner indicates the current price per square foot in Tempe is almost $116.  The meter on the top right corner indicates the annual average price per square foot for 2010 is about $118 per square foot.

The middle graphs indicate the averages expressed in monthly and annual terms.  You can see that the prices spiked as much as $10.00 per square foot in the timeframe between June and August 2009.  That was attributed to increased home purchases and occasional bidding wars over properties when buyers thought the tax credit was going to expire.

As a point of reference, price per square foot in Tempe two years ago was $157.  3 years ago, In February of 2007, the price per square foot was about $178.  It becomes clear that a $20 drop per-year has been the standard. Have we bottomed out? Except for the upward spikes shown in the graph Tempe appears to be somewhat flat. Is this the time to take a serious look at Tempe homes for sale?

Search Tempe, Scottsdale, Mesa Homes

Tempe Center for the Arts

Phoenix Real Estate in the 50’s – 60’s

There are a lot of new homes in the greater Phoenix metropolitan area. Face it, Phoenix has not been around as long as many of the east coast cities. I can go six months showing homes at not see a home that was built before 2000. This statement would not be true in many cities from across the United States.  So, if you live on the east coast and are reading this blog just bear with me.

Lately I’ve been showing lots of homes to clients who want to live in Tempe, Arizona.  I came up with an idea to write about the "Top 10 signs you’re in a house that was built in the 50’s – 60’s."  Here we go:

10. The electrical power reaches your home from a cable dangling over your head.
 9. The trash is picked up in an alley from behind your house.
 8. The water heater is outside.
 7. The power box is 18 inches square.
 6. Armstrong linoleum tile matches your pink toilet.
 5. All of the interior cabinetry is quarter inch stained plywood.
 4. The windows crank open.
 3. The gas heater is in the hallway closet.
 2. The doorbell is a Nutone chime.
 1. The stove does nothing but get hot.

Phoenix Real Estate

Housing Tracker Phoenix

Phoenix Real Estate

Arizona Relocation

ARIZONA RELOCATION – What are your “must haves?”

This article was sent to me by a friend in the mortgage industry. It’s not an article specifically about relocation, but an interesting look at what people are considering “must have” features in their homes. The survey was conducted by AVID Ratings Co.,which conducts an annual survey of home-buyer preferences. CEO Paul Cardis says these are 10 “must have” features in new homes. This survey is not focused specifically on Phoenix / Scottsdale, Arizona relocation. Rather, it is a Nationwide
survey and here are the direct quotes:

1. Large Kitchens, With an Island
“If you’re going to spend design dollars in a home , spend them where people want them — spend them in the kitchen,” Cardis said. Granite countertops are a must for move-up buyers and buyers of custom homes, but for others “they are on the bubble,” Cardis said.

2. Energy-Efficient Appliances, High-Efficiency Insulation and High Window Efficiency
Among the “green” features touted in real estate, these are the ones home buyers value most, he said. While large windows had been a major draw, energy concerns are giving customers pause on those, he said. The use of recycled or synthetic materials is only borderline desirable.

3. Home Office/Study
People would much rather have this space rather than, say, a formal dining room. “People are feeling like they can dine out again and so the dining room has become tradable,” Cardis said. And the home theater may also be headed for the scrap heap, a casualty of the “shift from boom to correction,” Cardis said.

4. Main-Floor Master Suite
This is a must feature for empty-nesters and certain other buyers, and appears to be getting more popular in general, he said. That could help explain why demand for upstairs laundries is declining after several years of popularity gains.

5. Outdoor Living Room
The popularity of outdoor spaces continues to grow, even in Canada, Cardis said. And the idea of an outdoor room is even more popular than an outdoor cooking area, meaning people are willing to spend more time outside.

6. Ceiling Fans
(I would consider this one to be specific to Phoenix / Scottsdale Arizona relocation

7. Master Suite Soaker Tubs
Whirlpools are still desirable for many home buyers, Cardis said, but “they clearly went down a notch,” in the latest survey. Oversize showers with seating areas are also moving up in popularity.

8. Stone and Brick Exteriors
Stucco and vinyl don’t make the cut. (ouch, this one hurts and could aimed specifically at Phoenix / Scottsdale Arizona relocation.)

9. Community Landscaping, With Walking Paths and Playgrounds
Forget about golf courses, swimming pools and clubhouses. Buyers in large planned developments prefer hiking among lush greenery.

10. Two-Car Garages
A given at all levels; three-car garages, in which the third bay is more often then not used for additional storage and not automobiles, is desirable in the move-up and custom categories, Cardis said.

In my opinion, people relocating to Phoenix / Scottsdale — and those relocating across town — do tend to have some differences in home preferences. Most of my relocation clients have tended to be a little wealthier because they were corporate executives being relocated. My out of state relocations have not been as concerned about items number two, six, and nine. However, they’ve usually expressed an interest in numbers one, three, four, and the opposite of nine (because they prefer golf course communities). Additionally, most prefer a three car garage.

My clients who have relocated across town are almost always interested in items number one, two, six, nine, and ten with little or no care for items four, five, and seven.

Arizona Relocation

Phoenix Real Estate

There currently 9,200 homes for sale in the city of Phoenix. Real estate deals are around every corner in the Metro area. Many REO properties need some work and we expect that. Some Phoenix real estate deals  need lots of work and cause potential buyers to go hmmmm …. And then there’s the occasional house that really stinks! Literally.

I took a buyer, who flew in from New Zealand, out to look at REO properties on Wednesday and saw some really good deals for Phoenix homes for sale. The banks don’t like to waste time anymore and most are starting to price properties really aggressively … enough so that many REO homes are still getting up to 15-20 visits in the first week.

Well, we are 5 homes into our search when we open the door to a really nice looking home in Phoenix. Real estate memories fill my mind, but this was one of those moments that would have been interesting to record — then watch our reaction on video. I knew something was wrong as soon as I swung open the door. 5 steps into the house and my eyes were beginning to sting. Holy pet urine Batman! This was not the work of a random “tinkler.” These pets had the run of the place. I never thought I would need to stop by Big 5 Sports and buy 2 gas masks before showing any Phoenix homes for sale.

My client was shocked at the smell. It was almost so thick it could be cut with a knife. But after traveling half way around the world to look at Phoenix real estate she could not be stopped. She proceeded to do a quick walk-through of the downstairs and headed upstairs. I started to assess her weight and wondered if I would need to carry her out of the house. It has been awhile since I worked out regularly at the gym. My mind started remembering the correct lifting techniques to avoid back injury.

She disappeared up the stairs and I tried to regain my senses. It occurred to me that she might think this yank was a pansy, so I darted up the stairs. That was a mistake because I started to breath harder. My memory was jolted into remembering that warm air rises. If it was possible, the smell was even worse upstairs. Of all the Phoenix real estate I could have been in … then I lost my train of thought.

Where am I?

Then I remembered. My client came out of the master bedroom and headed for the stairs (thank you God). She didn’t appear faint (thank you God). We headed outside and locked up the house. My client actually liked the floor plan and features and commented that removing the carpet would help a lot. She wondered what my thoughts were on the subject.

I actually had thoughts on the subject because, first of all, my sight and mind was returning. I told her I had bought a house with a similar problem at the trustee’s sale, which of course was “sight unseen” (and smell un-smelled). I described the process of scrubbing and sealing concrete. I described the process of sanding and sealing 2×4’s that were along the concrete floor. Thankfully she was losing interest in the house and I wouldn’t need to return (thank you God)! On to better smelling Phoenix real estate!

Today I received an email from the listing agent wondering what I thought about the house. It was then I decided to write this post. My return email will contain a link to it. That should be satisfactory feedback, don’t you think?

Phoenix Real Estate

Housing Tracker Phoenix

I usually break down the Phoenix housing market on a micro level. But, and as Monty Python used to say, “and now for something entirely different,” here’s a look at the larger macro picture.

I was interested to see just how far prices have dropped since the boom years. So I logged into the multiple listing service, came up with a few criteria, pushed a few buttons, and here you go: a 10-year look at the average price and price per square foot in the Phoenix housing market. This is my disclaimer: this information came directly from the Arizona Regional MLS. Any realtor and can get the same information. I’m not responsible for any errors in the data. OK, now that that’s over with, let’s get back to this post.

Read that chart in this manner: in 2009 there were 92,146 residential sales in the Phoenix area. That total sales volume equaled $15,668,606,573, or an average price of $170,045. Since the average sold home was 1,930 square feet, the average price per square foot in the Phoenix housing market for 2009 was $88.00

Housing Tracker

Phoenix residents and those in the know realize the rest of the chart isn’t really any ground breaking news because this information was available on an intuitive basis. In other words, we all knew that house values started an amazing increase in 2004 – 2005 and that many people bathed in the “afterglow” during 2006. But seeing these numbers all in one place — and in black and white — is a littleshock to the system. However, then the foreclosure crisis set in and home values decreased to their current state.

You can see a $94.00 drop in the price per square foot from 2006 to 2009. Obviously, that is due to the fact that approximately 55% of all homes sold in 2008 – 2009 were foreclosure-type properties. I’m talking about bank owned homes and short sales. That quantity of foreclosure sales is enough to suck the life out of values in any housing market (and we won’t name other housing markets in this post — you know which ones I’m talking about ).

When people ask me “is this the time to buy real estate” I can now honestly say prices are lower than they have been in the last 10 years.

Phoenix real estate

Housing Tracker Phoenix