The June Phoenix Real Estate Reports Are In…

Posted on July 9, 2009 by azpremiere

At the risk of becoming completely monotonous, my post this month is almost going to be a duplicate of last month with only a couple of differences, but major differences nonetheless.  I’ll try to spare you the usual long-windedness and go right to the charts.  Remember, click on any of the charts to see the larger version (opens in a new window).

What do I say that is different from the month before here?  Nothing really except that active listings in the Phoenix real estate market are down again.  In fact, they are down to 4.23 months worth of inventory – technically a seller’s market, but as I said last month, it’s really only a seller’s market in certain price ranges.  I’ll make an illustration on this point below.

Again, sold units are up, and because of the enormous demand for well-priced homes (i.e., bank-owned, short sales, etc), it continues to bring down the overall amount of time it takes to actually sell the home.  That point is amazing to me because there is a sizable chunk of the market that isn’t selling and continues to accumulate days on market, so I would for this trend to reach a point of diminishing returns, so to speak, and flatten-out and eventually trend back upward slightly.

This is a pretty interesting chart.  By looking at it, we can see that sold dollar volume is actually on par with sold dollar volume 2 years ago, but what is interesting is that homes, roughly speaking, cost half as much as they did then.  Does that tell you how many units we have sold compared to 2 years ago?  That’s right – about twice as many.

We’ve seen these numbers already, but we certainly see the upward movement in sales prices steadily over the last 3 months in total amount of about $13,000.  This is about how much value a home in this market has lost every 2 months for the last 2 years, so I cannot over-emphasize how important this shift is. 

As I noted in previous posts, this one is a bit difficult to gauge right now, and I will make some observations on this chart going forward as I have more data to work from, but I will say that the average reduction in price for active listings continues to decrease as a percentage of list price, and that’s something that we’ve continued to observe for about the last six months, and I hope it continues.

What do we make of all of this?  As I mentioned above, it certainly is a seller’s market based on the numbers, but it really is a tale of 2 markets.  On the one hand, we have the distressed property market, and on the other hand, we have everything else.  The distressed property market is SOOOOOOO hot right now (and has been) that it is making the entire market look good. 

Here is an email that I sent to some colleagues this past week concerning these numbers:  

Thought you might find these numbers interesting—they give us a little peek at the answer to my questions earlier:  For June 2009, the ‘sold avg. list price’ was $178,272 & the ‘sold avg. sale price’ was $171,781 for a 96.4% SP/LP ratio, and interestingly, the ‘new listing avg. list price’ is $230,421.  Do you wanna take a guess at the ‘active listing avg. list price’?  It’s $392,538.  In a market where we’ve seen some pretty wild swings in the numbers this is one that has not changed all that much.  In the last 2 years, that number has stayed within a $70,000 bracket—In July of 2007, the ‘active listing avg. list price’ was at a peak of $417,603 and a low in January of 2009 of $342,997.  Like I said, it doesn’t tell the whole story, but it certainly fills in some of those blanks.

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The Monetization of the $8,000 First Time Homebuyer Tax Credit

Posted on June 5, 2009 by azpremiere

There has been much talk in recent weeks about giving buyers the ability to use their $8,000 first time home-buyer tax credit in lieu of cash as downpayment (you, in essence, sell your tax credit back to the lender) on a home, and a great deal of the information is, at worst, errant, and at best, incomplete.  The bottom line is that the details are still being hammered-out, but here are the basic requirements:

  • The proceeds of the sale of the tax credit may not exceed the anticipated tax credit due the homebuyer based on the computations of form IRS 5405;
  • The borrower must submit a signed certification that the tax credit is not subject to offset due to other indebtedness.
  • A copy of the borrower’s tax refund and/or the IRS 5405 must be collected and retained in the FHA case binder. 
  • Any costs attendant to the purchase of the tax credit are to be nominal and discounting the anticipated credit to cover the costs and expenses of the transaction must be reasonable and disclosed to the homebuyer.  In FHA’s view, fees and costs that total more than 2.5% of the anticipated credit are considered excessive.  (Example:  $6000 to be refunded, with all fees and costs discounted, borrower should receive not less than $5850.00 for sale of tax credit.)
  • Pursuant to 12 U.S.C. 1709(b)(9), the homebuyer’s downpayment required for eligibility for FHA insurance may not consist of any funds (including funds derived from a sale of the homebuyer tax credit) provided by the mortgagee, the seller, or any other person or entity that financially benefits from the transaction (or by any third party or entity that is reimbursed, directly or indirectly, by the financially benefiting person or entity).  Accordingly, the proceeds of the sale of the tax credit to FHA approved mortgagees, the seller, or any other person or entity that financially benefits from the transaction (or any third party or entity that is reimbursed, directly or indirectly, by the financing benefiting person or entity), may not be used to meet the 3.5% minimum downpayment, but may be used as additional downpayment, buying down of interest rate, or other closing costs.

There are more stipulations, but I just wanted to make sure you had the basic framework for this new program.  I have posted the mortgagee letter on my website to help clarify some of the confusion, but the bottom line is that the funds can be used for closing costs, prepaids and to reduce the loan amount beyond the 3.5% down payment required by FHA, however the advancement CAN NOT be used to meet the minimum 3.5% down payment requirement.  In other words, the homebuyer still must come in with at least 3.5% down.  The funds will be made available to home buyer through the “sale” of their future tax credit, and according to the mortgagee letter, FHA-approved mortgagees and FHA-approved nonprofit organizations as well as Federal, state, and local governmental agencies and instrumentalities thereof may purchase the tax credit anticipated by the homebuyer.

I hope that this information is useful to you, and if you think you know someone who might benefit from this information, please pass it along.  Remember that at Arizona Premiere Living, we do more than just show you the best deals for Phoenix real estate; we help you get the most out of living in Arizona.

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The May Phoenix Real Estate Reports Are In…

Posted on June 4, 2009 by azpremiere

Wow – What a month!  I thought April was nuts, but the Month of May would prove to be much more active.  These last couple of months rival even the boom months of September and October of 2006 in terms of actual units sold.  Let’s go straight to the charts, and remember that clicking the chart will enlarge it (will open in a new window).

In keeping with the broken record theme, it is easy to tell here that sales are up (over 9,000 homes sold in May) and inventory is down (just over 40,000).  In fact, inventory is down below 5 months, and I’ll put an asterisk next to this statement, but that is what many define as a ’seller’s market’.  I put an asterisk next to it only because this is not a normal market…

Again, units sold are up considerably and the time it takes to get a home sold is down slightly.  One thing to note is the widening gap between Agent Days and Cumulative Days. This would indicate that buyers have to one degree capitulated to the market.  One agent is unsuccessful in selling the home, so sellers find another agent who likely tells them that they will need to reduce the price of the home in order to get it sold.  The longer it is on the market, the more agreeable sellers become.  Interesting little thing I’ve bee watching for a while…

We can see here (again) that sales volume is very high, and for the second month in a row, we’ve experienced some market appreciation – about $6,000 in the last 2 months.  That doesn’t sound like much, but  I think I have said before that when you’ve been losing $8,000 in value every month for the last 2 years, putting a parachute on is a priority, and the last 2 months show a very promising trend.  As I’ve pointed out before, any time you have the list price and sold price lines moving closer together, you should see a slight spike in the list price in the next month.  Perhaps we are just testing the bottom of the market, but I look for this trend to continue.

We’ve seen these numbers represented in different graphs already, so I’ll spare my expert analysis, but my wish is that things will continue to creep back up and out of the hole that they’ve been in for so long.

This is a difficult chart for me to read now.  I used it for several months as a leading indicator of what preparations this market was making prior to arriving the cautious bottom making the upward moving that we’ve seen in the last 2 months, but I don’t know exactly how to look at it moving forward…  Hey at least I’m human and admit that which I do not know.  This one may have little commentary associated with it over the next couple of months as I figure out how to use it now.

There are definitely some major economic factors at play right now, so I am cautious about calling this a bottom, but I think we’ve lost all of the value that this market is willing to lose (I hope that makes sense).  I think we’ve reached something of a tipping point – something we’ve been waiting on for several months – and I think, by and large, we’ve reached a point of relative agreement between buyers and sellers – something you must have in order for a market to work.

Stay tuned to this space in the next month for the latest in Phoenix real estate, but feel free to check out our real estate resources section of our website – we update it frequently.  Thanks again, and let me know what you think.

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The April Phoenix Real Estate Reports Are In…

Posted on May 13, 2009 by azpremiere

We are back, and there is definitely some good news to report.  In short, the gains that were made in March were definitely built upon, and taken in combination, the last 2 months have had a fairly signifigant impact on the market.  Enough of my talk…  Let’s take a look at what the market has done, and, as usual, click on the chart to see the enlarged version (opens in a new window).

What can I say?  Inventory level is down; Active listings are down; New listings are down; Sales are up.  Each of these indicators represents the superlative in each category for the last 2 years, and though prices are still quite depressed, inventory levels are reaching balanced territory.

Again, we can see just how dramatic the volume of sold properties compared to the last 2 years of data, and we can see that, inversely, days on market are down slightly.

 Well, well, well…  Here we see some history being made.  We are actually seeing some market appreciation, albeit ever so slight, but it is appreciation nonetheless, and we’ll take it.

 Again we see the appreciation along with the decrease in days on market, or the time it takes to sell a property.

 This one is a bit difficult to read right now – next month will give us a little better opportunity to gauge this apparent dip in price reductions.  More on this one next month…

All in all, I couldn’t be more satisfied right now, or more tired.  I know, I know…  We would love to see the prices come up, but we’re in uncertain economic times, and we need to make sure that the recovery is sustainable in terms of what buyers can afford.  I’m just happy leveling-off for a change. 

Stay tuned to this space in the next month for the latest in Phoenix real estate, but feel free to check out our real estate resources section of our website – we update it frequently.  Thanks again, and let me know what you think.

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1st Quarter Maricopa County Real Estate Reports

Posted on April 28, 2009 by azpremiere

I wish I had more time to talk about them, because the information contained in these reports is pretty remarkable, but instead, I’ll just provide a link, let you read, and then digest…  If you have any questions or comments on the report, let me know; I would love to hear what you think. 

You can find the 1st Quarter Maricopa County Real Estate Report here, but if you are looking for anything and everything that is Phoenix real estate, please visit our website, and check out the real estate section, but don’t forget to check out our other sections as well.  Thanks again for stopping by.

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The March Phoenix Real Estate Reports Are In…

Posted on April 28, 2009 by azpremiere

If you wonder why I am so delinquent in posting the March numbers (or any other posts for that matter), it’s been because we’ve been BUSY!!!  You’ll understand just how busy when we get to the numbers, and if my schedule is any indication how the April numbers will look, I think you are going to see som interesting things – positive things – very soon.  Enough talk.  The charts (click the charts to see the full-sized image – opens in a new window).

The first chart shows that, though there have been more new listings added in the last month than any of the previous 4 months, sales are up above anywhere they’ve been in over 2 years and inventory is down dramatcally for the third month in a row and down to the lowest point in over 2 years.

Again, we see the dramatic spike in sales, but we also are watching the increase in days on market.  I think some of this could be explained by the length of time it takes to take a short sale from contract to close of escrow.

This one is self explanatory.  Prices continue to fall, but we wonder how long that can last…

Again we see days on market on the rise and prices in a long decline.  We are hoping that the sales of the last couple of months can help to stabilize both of those trends.

Last we see that price changes on the average continue to trend toward the ‘less-drastic’, and I think that, if weighed against the actual drop in values over the last 2 years, these numbers are pretty remarkable.

What can we say?  The same trends have been moving in the same direction for several months, and I’ve basically been saying the same things for all of those months, but I think that we are, in some respects, at a tipping point where people are shrugging off much of the bad news that they’ve been bombarded with over the last year and a half because they know that, historically, there aren’t often buying opportunities like this.

Stay tuned to this space in the next couple of weeks when the April numbers roll out, and for the latest in Phoenix real estate, but feel free to check out our real estate resources section of our website – we update it frequently.  Thanks again, and let me know what you think.

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41212 N. Lytham Ct. – Anthem, AZ 85086

Posted on April 13, 2009 by azpremiere

Beautiful 4 bedroom 3 bathroom home located within walking distance of Anthem’s Ironwood country Club. Located on large cul-de-sac lot with Mountain Views and very private resort style backyard. Granite countertops, diagonally-laid ceramic tile, custom paint, and many more upgrades. Refrigerators in kitchen and garage, washer and dryer and shop vac in garage do not convey. Short sale. Lender approval required.  To see this lovely home, or to ask any questions about it, please call Jerry Murphy at 602/334-3757, or send him an email at JWMurphy@Windermere.com, or call Ben Bailey at 480/220-8022, or send him an email at Ben@ArizonaPremiereLiving.com.  Find your place in the sun.

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Avondale Introduces Home Buyer Assistance Program

Posted on March 31, 2009 by azpremiere

I’ve been trying for 2 weeks to gather the information that took only 2 phone calls to gather today, and I have a very nice and informative gentleman at the City of Avondale to thank for it.  This is a partnership program with Housing Our Communities that, very generally, seeks to target particularly high-foreclosure-rate areas in Avondale and provide incentives for people to buy in those areas.  There are some requirements and income restrictions, but the city has about $1.7M dedicated to this program which would most likely help only about 60 individuals or families, however there is a possibility that, though nothing has been officially set aside, there could be more dollars in the pipeline.

Here is a press release, and if you visit the real estate resources section of our website, you will find some additional resources outlining the program as well as outlining exactly what areas the program targets.

If you have any questions about the program, or if you have any questions about Phoenix real estate in general, please do not hesitate contact us – we would be more than happy to help you find what you are looking for.

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Phoenix Announces $15,000 Loan Program for Foreclosure Purchases

Posted on March 17, 2009 by azpremiere

I just got the news on this one this morning, and though it sounds like a decent program, it may not help all that many people in the Valley.  First of all, the home needs to be within Phoenix city limits; it must be a bank-owned home; the buyer must qualify for the loan according to FHA guidelines; they must take an 8 hour credit counseling class; and the home must be more than 15% below appraised value of the home.  In addition to the above requirements, there are income restrictions, inspection, and disclosure requirements among other things.

You can find the fact sheet that we’ve posted on our website here (just click on the NSP Homeownership Fact Sheet – opens in a new window), but if there are any additional questions, please feel free to email or call us, or you can visit our website to find out not just about the best deals in Phoenix real estate, but how to get the most out of living in Arizona. 

I hope you found this information helpful, and if you think someone else might benefit from this information, please pass it on.

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The February Phoenix Real Estate Reports Are In…

Posted on March 4, 2009 by azpremiere

Some of these charts, over the months, can tend to be redundant; I am sensitive to that and apologize, but I need you to understand where the market has been and where it is going.  Without further adieu, here are the charts (click on the chart to see the full-sized chart, and remember that it will open in a new window)…

 

I think this is the most refreshing chart to look at because it shows three important things happening:  New listings are down, sales are up, and inventory is at its lowest level in about 2 years.

 

Here we see that despite the increase in the days on market, sales are, as mentioned above, up to their highest levels in 5 months.

 

Here we see that prices continue to decline but I think if we can see a couple of bumps where the List Price/Sale Price Ratio gets a little higher like we saw in September of ‘08, we may see a bit more of a flattening effect in the fall of prices.

 

Here again we see the fall in prices over the 2 years in all but 4 months (as compared to the previous month) set against the backdrop of the increased days on market.

 

It appears that, at least for the month of February, there was a stalling effect in the price change trends.  We had been watching the decrease in price changes among active listings shrinking steadily now for the past 6 months, and although February represents a 7th month – just barely – it represents the smallest decrease in that trend for the last 7 months.

I think we can sum things up by saying a number of things that I’ve been saying already but also something new.  Quite simply, I think we are seeing the money that has been pulled out of the equity markets now flowing into real estate, but these people are still looking for bargains.  They are snatching the bargain prices and chipping away at the inventory which is a good thing.  Stay tuned to this space for the latest in Phoenix real estate, but feel free to check out our real estate resources section of our website – we update it frequently.  Thanks again, and let me know what you think.

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