The Scott's Sell Scottsdale

Even thought the temperature remain hot, the Fountain Hills Real Estate market has 'cooled' from July 5th to August 5th 2010.
Residential closed sales have dropped from 520 to 473 (16%) and the properties currently in escrow (pending sale) were reduced from 413 to 348 (12%).
The overall number of active listings has also been reduced from 2,914 to 2,896.



The slower summer month activity should increase with the approaching fall and winter months just around the corner.  There are some excellent opportunities for those Snowbirds that descend on the Valley of the Sun.

Search for Fountain Hills Real Estate

Home prices in the greater Phoenix metro area continue to be influenced by foreclosure-related activity. However, the foreclosure share of the recorded in May 2010 has decreased from 40% to the 33% recorded in March 2010.We are heading in the right direction.

Again, foreclosure activity varies across the valley (40% in El Mirage while only 22% in Tempe). Median foreclosure sales prices widely vary across the valley as well. Even in a single city the median prices can differ. For instance, in North Scottsdale the median price of a foreclosed property was $446,000 while in South Scottsdale the median price was $208,190.

Default and late payments remain at record levels. Will there be another wave of foreclosures??
The “experts” cannot agree. . if we only had a crystal ball. Time will tell.

(W) = West Valley Cities &  (E) = East Valley Cities

Renovation Lending is a option for purchasing a property sold 'as is'.  This type of loan will include the purchase price and repair money. Wow, the buyer can purchase the house and have the cash to pay for   professional contractors to fix it up after closing! No need for ‘out of pocket money’ or a second loan to make the repairs to the property. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property.

In today's market place with so many vacant lender owned properties that require repairs (often just to make the home inhabitable), a 203(k) loan is a great option for those buyers who are unable to make an all cash offer.

The buyer must be FHA qualified and be the primary resident of the property. The most common terms and conditions of the loan are 30 year fixed. The cost of the rehabilitation must be at least $5,000, but the total value of the property must still fall within the FHA mortgage limit for the area.

When a property is initially sold there a Certificate of Occupancy (CO) is issued. The CO guarantees that the basic construction, wiring, plumbing, and other elements of the building are up to code, and can be certified as being safe for occupation thus allowing the new buyer to take possession. When a re-sale property is presented as collateral on a loan application, lenders obtain copies of the certificate of occupancy. Often with a distressed property, the buyer cannot obtain the CO because there are significant repairs required prior to habitation.  Without the CO the buyer cannot get the mortgage. The 203(k) loan allows for the home to close and the repairs to be made through the title company account holding the repair money after the close. Once the repairs have been made and inspected, the buyer will receive the CO to take possession. 

So you ask, What is the Process??

Well, first the FHA buyer should become pre-qualified with a lender who is proficient at the 203(k) loan. I was at a presentation from Bank of America today. They have a good program and would be an excellent choice for obtaining this type of loan. Once the buyer understands what he loan amount he can qualify for, then he views properties with his Realtor familiar with these programs. The property must be a one- to four-family dwelling that has been completed for at least one year.

So what price home should you look for? The borrower must find a property that will fall within the his lender qualification limit including the repair money. The property needs to fall with the comps of the are for the ‘completed repair value’. For instance, if you qualify for $200,000, you may want to begin looking at properties around $150,000 with a $50,000 window for improvements. The Realtor, the buyer, a trusted licensed contractor and the lender all work together to determine an estimate of the repairs required to make the property livable. If the estimate is within the buyer borrowing limits and the amount of the ’total loan’ (purchase price + repair cost) is within the appraised value for like non-distressed properties in the neighborhood, the offer for purchase is made.

Once the offer has been negotiated and accepted, the home follows the standard closing process. Upon close of escrow, the wheels for repair begin. With the non-streamline 203(k) loan, a HUD consultant is now immediately added to the team to determine the repairs and sign off on them as they are completed. Once the repairs have been completed and the work has passed the HUD consultant inspection, the money is paid to the sub-contractors providing the work. The repair money it held in an account at the title company for the specific property. All repairs should be completed and the home is to be is satisfactory condition for the new homeowner to move in within a 6 month window.

There are several benefits to this type of program. It provides an opportunity for home ownership by allowing for non-cash buyers to qualify for a loan to purchase a distressed property with no out of pocket expense for the repairs. It provides community and neighborhood revitalization as it speeds up the process to sell those vacant properties in a neighborhood while making the homes desirable again. These improved homes will also cause the home values in the neighborhood increase.

For additional information regarding these Rehab loans - check the HUD website

We would be happy to recommend lenders who would assist you with the 203(k) loan!

We are Full Time / Full Servie Realtors who can help you find your home!!

Short sales are plaguing the real estate market.  Here in Arizona a Short Sale Advisory has been generated by the Arizona Association of Realtors.  This advisory provides valuable information for a short sale real estate transaction.  In addition to the information included in the Short Sale Advisory itself, there are multiple hyperlink references for web sites with additional assistance and guidelines.

The Arizona Short Sale advisory has been an example to the rest of the country for providing the consumer with needed information to answer their short sale questions as well point the homeowner to resources available to them.  The Short Sale Advisory not only provides specific information related to a short sale but also give a homeowner options to consider regarding  lenders and their loan.  The advisory alerts the homeowner that a short sale is a complicated transaction and gives them links for attorneys and tax consultants who can give the homeowners advice for their specific situation. 

Although the Arizona Short Sale Advisory is not intended to be comprehensive,
it is a excellent tool for the consumer!  Check it out. 
Arizona Short Sale Advisory

Some of the topics covered in the Advisory:

• Understand a Lender's Options upon Loan Default
• Be Aware of Predatory "Rescue" Scams & Short Sale Fraud
• Contact a free HUD-approved housing counselor or contact your lender directly
• Utilize free services available to Arizona residents
• Obtain Legal Advice
• Obtain Tax Advice
• Be aware of the Consequences of Committing "Waste"
• Consider All Options such as:  loan workout, loan modification, refinance, deed in lieu of foreclosure, work out sale, bankruptcy and foreclosure
• Contact a qualified real estate professional
• Investigate documentation and eligibility
• Determine the amount owed on the property
• Determine the estimated fair market value of the property
• Consult legal counsel
• Understand that a short sale may not discharge the debt
• Obtain tax advice
• Be aware of the impact on your credit score
• Understand that there may be a waiting period before you can buy another home
• Review the Arizona Association of REALTORS® (AAR) short sale forms

If you are considering a short sale, feel free to contact us to assist
you with the marketing and sale of your home.
garyandclaudia@cox.net
480-948-0550

Wow, this is a great home in NE Phoenix close to parks, schools and convenient for freeway travel.

This tow level 3 bedroom (all upstairs). 2.5 bath home is clean and in excellent condition.  The first floor is all tile while upstairs if new carpet.  All new appliances.  Washer, dryer and refrigerator included.  Eat in kitchen and breakfast bar. Open bright layout.  Neutral colors.  Storage cabinets in the garage.

Nice size private  backyard - easy maintenance, mature landscaping, large covered patio and built in BBQ. Would be great for entertaining.

Lease for only $1250 per month. Minimum 12 month lease.  Sorry No pets and No smoking. 

View More details and photos at  AZ-real-estate-sales.com

The real estate industry continues to strive to improve the green home and educate the public of the amazing technology available today to make their existing home more ‘green'.

The benefit of green technology is twofold. Not only does the homeowner help the environment, he also saves money and enjoys a more comfortable surrounding.

Many of the invocative green technology options available today can improve the average energy efficiency and produce a healthier indoor quality of living. Solar heating, hybrid solar systems, green batteries, better thermal insulation are some of the new options being developed.  Renewable energy and sustainability will be a significant part of our future.  Arizona is a national leader in energy efficiency. We are rated number 1 in solar renewable energy capacity.

Energy suppliers such as Arizona Public Service (APS) and Salt River Project (SRP) rebates along with Federal tax credits are making ‘going green' affordable for consumers. An in-home high tech energy audit will provide the homeowner with checklist of where their home is losing energy with recommendations for the most cost effective ways to improve energy performance and a healthier lifestyle. The homeowner can review the list, find qualified tradesmen to handle the project and get a rebate & tax credit to help defray the costs! The homeowner can enjoy the benefits of the savings and add value for the eventual resale of the home.

There are also Energy Loans for renovation projects as well as Energy Efficient Mortgages (EEM's)  that allow for the home buyers add the cost of the energy-efficient upgrades into their new mortgage. The added cost of the loan payment is offset by the savings in the daily home energy costs.

Save the environment - save money - enjoy a more comfortable environment
Sounds like a win - win for everyone!

The short sale, now an every day word in our vocabulary, is a property that has a loan due to a lender that is less than the present real estate market value.  The actual short sale occurs when a lender agrees to discount a homeowner's loan balance when an 'upside-down' homeowner needs to sell his home. The bank absorbs the monetary loss and the homeowner loses his home. Here in AZ, the homeowner is protected. We are an Anti-Deficiency state, meaning that the lender cannot come after the homeowner for the deficiency of the sale.

What happened to the 'good old days'when there was a seller who wanted to sell and a buyer that wanted to buy? The offer was made, the contract was negotiated and the home was sold.  OK, maybe there were issues.  But in most cases, transaction was relatively smooth and the result was both a happy seller and a happy buyer. The seller was not losing his home and buyer did not have to accept the property 'as is' with no warranties.
The reality of of real estate in today's market place is very dirrerent.  
Lenders - short sales & foreclosures. The real estate market is overwhelmed with them! 
On average, lenders lose 50 percent on a foreclosure, but only 30 percent on a short sale. So, you ask, why are so many short sales not closing and evolving into foreclosures?

The answer is not simple. The short sale is complex and sometimes confusing. Often there are second liens that do not approve the sale because they would profit little or nothing. The requirements of the owner to qualify for the short sale are quite stringent and each lender has their own forms to be completed. However, in all cases, the homeowner must prove hardship as to why he needs to sell. The owner cannot just decide they want out of their mortgage because their house is not worth what they paid for it. The short sale process often take an extended amount of time. Initially,  lenders were overwhelmed with the volume of short sales and the man power to process them was limited.  The real estate community including Realtors and title companies required a huge learning cure to understand this new process. Offers submitted to lenders are rejected if the paperwork is not complete or the seller dose not qualify. Low offers are rejected as lenders hold out for a higher price......the result, many times the property reaches its foreclose date before the short sale approval can be reached.

The new the new government program now is offering first lien holders incentives to share while also awarding second lien holders and homeowners cash incentives.  Lenders obtain a Broker Opinion of Value to determine the current fair market value of the property.  Under the new program lenders must tell the seller the minimum they'll accept. When the seller comes back with a good offer, it must be accepted within 10 days.

Will lenders and the consumer react favorably to the new programs??
Will these proposals expedite the time and number of closed short sales?

Time will tell. Stay tuned for the rest of the story.

Establishing the market value is not an absolute science. But is should be based upon location, the latest  ‘like property' sales in your neighborhood, condition of home, features, market inventory and conditions.

Here are some factors that should NOT influence the pricing your home :

1. Your cost.  The amount you paid, does not affect the current market value.
2. Your Investments / Improvements.  Sometimes improvements, such as upgraded new kitchen, can influence the asking sales price, but typically you will not recoup the total amount of your improvements. An improvement to you, may not necessarily be an improvement to a potential buyer. Consider the improvements for your enjoyment and use.
3. The Assessed Value. This is the value given to your property by the local authorities to determine your real estate taxes.  This value does not typically reflect the true market value as it is only a percentage of the value.
4. Your Needs.  The value of the property should never be what you ‘need' to recoup from the sale. Value it determined by what a buyer is willing to pay for your property in the current market.
5. Emotion. How can anyone place a value on either the good or bad emotions/memories associated with your home?  Value based on ‘facts' not emotional attachments.

The Real Estate Encyclopedia states that Market Value is: "The highest price in terms of money which a property will bring in a competitive and open market and under all conditions required for a fair sale like the buyer and seller acting prudently with knowledge and neither being affected by undue pressures."

Listing your home for sale at the correct price that reflects fair market value is one of the primary factors that bring a sale in a reasonable time under ANY market conditions.

Selling your home can be exciting, but it also takes work.  
Prepare yourself to sell your house. Do your best to see the house, no longer as your home, but as a product to be marketed. Your goal is to get others to see it as their potential home, not yours. The first step in getting your home ready to sell is to "de-personalize" it. Now is the time to fix/repair those problems that you have been putting off. The more your home is 'move in condition' ready, the more buyers will be motived to purchase it.

Feel free to contact us at any time for a FREE market evaluation

GaryandClaudia@cox.net

http://www.az-real-estate-sales.com

The Short Sale - only a few short years ago this term was not part of our every day vocabulary! In case, you still are not sure what the term means; it is a property that is sold for less than the present balance of the mortgage. The "short" history of this process was often difficult and time consuming and was rarely successful.

The government is attempting to provide legislation to assist defaulting homeowners avoid foreclosure by speeding up the Short Sale process. The latest program will allow owners to sell for less than they owe and will give them a little cash to speed them on their way.  Bottom line, the plan aims to prevent foreclosures.

The new plan which will go into effect on April 5, 2010 is intended to streamline and standardize the Short Sale process. Under this new program, up to three payouts would be made in hopes of bringing the mortgage lenders, second mortgage holders and borrowers in order to streamline the Short Sale process.

· The first- mortgage loan servicer will receive $1000 to agree to the Short Sale. The bank servicer avoids the cost and frustration of the inevitable future foreclosure of the home thus allowing for more proceeds.

· Another $1000 can go to the second mortgage holder (if there is one on the home). The second is  guaranteed at least some income.

· And, finally, the government would also give $1500 in relocation assistance to the homeowner!  The borrower/owner should suffer less damage to his credit ratings and receive the lender's assurance that there will be no future action taken regarding the unpaid mortgage balance.

The real estate market also benefits by having fewer empty foreclosed homes waiting to be sold by the banks. Fewer foreclosures would be a benefit to all communities.

Of course, when there are second or even third mortgages on the property, the scenario is more complicated and perhaps not a short sale candidate. 

The homeowner STILL has to provide financial hardship as a reason for the Short Sale.  You cannot simply walk away from the property because the current value is less than you owe on the mortgage.

Should be a win-win for everyone...............nevertheless,  how this new program is implemented and how effective it will be remains to be seen.

In an effort to stabilize home values and improve conditions in communities where foreclosure activity is high, Friday, Jan 15, 2010, HUD Secretary Shaun Donovan announced a temporary policy that will expand access to FHA mortgage insurance and allow a quicker resale of foreclosed properties.

The 90 Day “Seasoning Rule” for FHA financing,  will be lifted starting Feb 1, 2010.
It will be in effect for ONE year.

FHA currently requires a seller to own (must be on the title) a Phoenix property for a minimum of 90 days before they can sell it to a buyer using FHA financing.  In today's real estate market,  FHA seems to be the financing of choice by first time home-buyers searching for the American Dream of home ownership. 

In the past, if an investor wanted to sell their property to a FHA borrower, the investor would have to hold the house for 90 days before they could write a contract with the borrower. The rehabilitating and the reselling of these properties to prospective homeowners often takes less than 90 days. Thus investors would sell the property VA, conventional or cash buyers before the FHA buyer had the opportunity to make an offer on the property.  This lift of the 90 day 'seasoning rule' will now permit buyers to use FHA-insured financing to purchase homes they previously could not qualify to purchase.

To protect FHA borrowers against predatory practices of "flipping" where properties are quickly resold at inflated prices to unsuspecting borrowers, this waiver is limited to those sales meeting the following general conditions: See the HUD website for detailed waiver requirements.

· All transactions must be arms-length —With no identity of interest between the buyer and seller or other parties participating in the sales transaction.

· In cases in which the sales price of the property is 20 percent or more above the seller's acquisition cost, the waiver will only apply if the lender meets specific conditions.

· The waiver is limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for purchase program.

Seems to be a good compromise!
Good for both Investors AND the FHA buyer as well as for our communities!

Begin your Scottsdale and Greater Phoenix Metro area Real Estate Search here!
AZ-real-estate-sales.com