Arizona Real Estate Blog

Can "Regular" sellers still sell?

I speak with homeowners all the time who ask me if they'd be able to sell in the current Phoenix area real estate market.  They ask how they can possibly compete against all the REO's (foreclosures) and short sales - all the "distressed" properties.

I tell them the same thing over and over.  They can actually have an advantage selling in the current market. An advantage?  Yep!  There are many buyers who shy away from foreclosures and short sales.  Foreclosures can be scary for some buyers because of the "unknown" factors surrounding foreclosures.  Short sales can take a long time, if they happen at all.

So, "regular" homes for sale, those that are not foreclosures or short sales, can appeal to buyers.  They have an advantage over the distressed properties.

However, they must be able to COMPETE.  Compete how?  Yes, the word you didn't want to hear: PRICE.

Regular sellers can certainly compete, but you must "price it right."  As with anything, price is king.

Price it right and it WILL sell... PERIOD! 

More Help for AZ Homeowners!

Today President Obama announced an additional $1.5 billion in homeowner aid for the areas of the country hardest-hit by declining home values.  Yes, Arizona is on that list, in addition to California, Nevada, Michigan & Florida.

As you may have guessed many Arizona residents owe more on their mortgage than they're home is worth.  This is one of the reasons why there are so many short-sale properties and foreclosure now.

There aren’t a lot of details yet on the newest aid for homeowners. The Department of the Treasury say they will announce the rules of the program and how much each state will receive in the next two weeks.  So be on the look out if you need help.

 

 

Four States Top the Foreclosure List

The bad news continues... foreclosures continue... and are expected to increase in 2010.  Despite government and financial industry efforts, homeowners continue to struggle. 

And, of course, the states that benefited the most from the real estate boom a few years ago, are the ones that top the list for the hardest hit in the housing crisis.

They are... as you might have guessed:

• California
• Florida
• Arizona
• Nevada

Do buyers need a strong pre-approval?

In today's real estate market, bank's and other lenders have tightened their lending standards and made it more difficult to qualify for real estate loans. This makes it more challenging for buyers when competing against multiple offers as we see so often.

As a buyer you will greatly enhance your odds for acceptance of your offer and a successful purchase by getting "pre-approved" with a lender as early on in the process as possible. The best time would be BEFORE even starting the home search process. Also, a lot of sellers going to be much more impressed when the pre-approval comes directly from the lender - like a major bank, than when it comes from a smaller, lesser-known company. I'm not saying that loan brokers and smaller lenders are not good to work with; I'm only suggesting that as buyer you may appear "better qualified" by working with a well-known lender AND by getting a "pre-approval" (not just a pre-qualification) in advance.

Now days, most sellers won't even consider an offer if a buyer hasn't already been working with a lender. Again, however, a pre-APPROVAL is much better.

As always, consult with your Realtor on your specific situation, and ask your Realtor to refer you to a strong and reputable lender.

 

Was this info helpful?

What experience have you had with this? 

Do you have info to share that will help other buyers? 

Feel free to leave a comment.

First time buyers: Get your $8,000 tax credit

First-Time Home Buyer $8,000  Tax Credit: 6 Things to Know 

1. Eight grand, new buyers:  This  credit is equivalent to 10 percent of  the purchase price of the home–  although it’s capped at $8,000–and  applies only to first-time home  buyers and principal residences. But  unlike an earlier $7,500 home buyer  tax credit, this one does not have to  be repaid.

 2. First time buyers defined: For  the purpose of this legislation, a  “first-time home buyer” is someone  who hasn’t owned a principal  residence for three years before  buying a house. (The date of  purchase is considered the day that  the title is transferred.) That means if  you’ve owned a vacation home–but  not a principal residence–within the past three years, you would still qualify for the credit.

3. 2009 buyers only: Only those who purchase a home on or after January 1 and before December 1, 2009 are eligible for the credit. Anyone who bought a home last year won’t be able to take advantage of it.

4. Income limits: The tax credit is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit, that’s $150,000 for married couples. Those earning more than these thresholds may be eligible for reduced credits.

5. Refundable: Because the tax credit is “refundable,” qualified buyers can take advantage of it even if they don’t have much tax liability.

6. Recapture: Buyers have to own the home for at least three years in order to capitalize on the credit. If they sell the home before then, they will have to return the credit to the government. (Exceptions will be made in certain cases, such as death or divorce.)

Thanks to U.S. News for providing useful information.

Century 21 Premier is now 1st USA Realty

Century 21 Premier is now 1st USA Realty.  1st USA Realty is an independent real-estate brokerage that has has built a solid and successful real estate firm with a reputation for high quality customer service.  1st USA Realty is one of the most respected and well known brokerages in the Valley.  We are very excited to be a part of the 1st USA team.  If you have any questions please call.

Mortgage Rates Are Falling

The US Treasury purchased $600 Billion in mortgage backed securities and now interest rates are falling.  

The Treasury Department is also considering a plan to lower mortgage rates on loans for home purchases to 4.5%. The government has also been urged to consider preventing foreclosures by including buying risky mortgages and refinancing them under more favorable terms to homeowners.

Many feel that housing led markets into this mess. So even though the crisis has now broadened, housing is still likely to lead the way out.

No one knows an exact cure but if you're a home buyer you can certainly bennefit from lower interest rates.  

 

Lower Interest Rates Entice Buyers To Jump Back Into The Market

With all the uncertainty in the economy over the past few months and with the real estate market plunging over the past three years, buyers have been fearful to getting back into the market and buying real estate.

Top 10 Fastest Growing Real Estate Markets

Yes, despite the current housing crisis in America, there are still parts of the country where price gains are expected in the coming year, according to Money Magazine.

Here is the list.

• McAllen, Texas
• Rochester, N.Y.
• Birmingham, Alabama
• Syracuse, N.Y.
• Buffalo/Niagara Falls, N.Y.
• New Orleans, La.
• Scranton, P.A.
• Grand Rapids, Mich.
• Baton Rouge, La.
• El Paso, Texas

Sellers Most Frequently Asked Escrow Questions

Here is a list of the questions I get most often about escrow.

.

.

Q. When do I get my proceeds check?

A.  On the day of recording. You can request that your escrow officer either cut you a check or wire the funds

.

Q.  Why do I have to pay interest on my loan pay-off past the day of recording?

A.  Your lender continues to accrue interest to the date that they post your loan as being paid in full. This could be one or two days from the date your escrow officer sends your pay-off check via overnight mail or wire transfer

.

Q.  When do I get a refund form my impound account?

A.  After your escrow officer sends your pay-off check to your existing lender, you can expect to get your impound account back direct from your lender within 30-60 days. If you have questions after that time, it’s best to call your lender

.

Q. When do I cancel homeowners / fire insurance?

A.  Please do not cancel your insurance until you have confirmed with your titleco. That your transaction has closed.

.

Q.  Why does my escrow officer require that I complete a 1099 form?

A.  A 1099 form is the reporting form adopted by the IRS for submitting the information required by law.  Under guidelines established by the IRS, sellers of real property are required to have their sales price reported on the 1099 form.

.

Q.  What is a Statement of Information?

A.  Statements of Information provide the title companies with the information they need to distinguish the buyers and sellers of real property form others with similar names, for the issuance of title insurance at close of escrow.  After identifying the true buyers and sellers, title companies may disregard the judgments, liens or other matters on the public records under similar names.

.

Q.  I don’t understand tax pro-rations.  How do they work?

A.  Each year on January 1^st, the lien of that year’s property taxes attached to the land, pursuant to Arizona Law.  The lien is not due and payable until October 1^st of that year for the first half of that year’s bill and the second half of that year’s bill is not due until March 1^st of the following year.  Pro-rations are done to reimburse the buyer for the portion of the year that the seller has owned the property and has not yet paid taxes.

.

Q.  What’ll I need to take with me to the title company to sign my documents for closing?

A.  Take one of the following: Arizona Drivers License, Arizona ID card or Military ID

.

By the way, if you'd like to discuss how you can take advantage of all the great opportunities in this market feel free to call at (480) 430-9761 or click here and let's talk.

 

Are you ready for your home loan application?

 

The home loan application requires personal and financial information. Knowing and having everything you need ahead of time helps the process move along more smoothly for you.

Be prepared to provide the following to your lender:

.

• Addresses of residences for the past 2 years
• Social Security number
• Drivers License or other Valid ID
• Names and addresses of employers for the last 2 years
• 1 month worth of pay stubs showing year-to-date earnings
• Federal tax returns for the last 2 years
• W-2’s for last 2 years
• Last two months bank statements for all checking and savings accounts
• Real estate loans: names, addresses, account numbers, and payment amounts on all loans
• Credit cards: names, addresses, account numbers, and payment amounts on all credit cards
• Addresses and values of other real estate owned
• Value of personal property: Your best estimate of the value of all your personal property (autos, boats, furniture, jewelry, TVs, stereo, computer, other electronics etc)
• Divorce decree if applicable
• Funds to pay upfront for the credit report and appraisal
• For a VA loan, Certificate of Eligibility or DD214s

By the way, if you'd like to discuss how you can take advantage of all the great opportunities in this market feel free to call at (480) 430-9761 or click here and let's talk.

 

The Appraisal Process Explained

Finally you’ve got a buyer! They love your home and want to buy it.  But it’s not over yet.  The process is just starting and one thing that is required is an appraisal.  I’ll explain the who, what, when, where and why of appraisals for you.

 

Why: When you sell your house the buyer is going to get a new loan to purchase the property, the buyer’s lender requires a licensed appraiser to estimate the market value of the property to who the lender that they are making a good decision to lend the buyer the money to buy the house. 

 

When: Once the buyer begins the new loan application process the lender will order the appraisal.  To get a good estimate of the market value of your house, the appraiser will research the houses sold in your subdivision or immediate area.  Appraisers prefer to use homes sales occurring within the past 6 months and are similar to yours in square footage, year built and amenities (swimming pool, garage size, single story etc).

 

Who & How: The appraiser will measure you house, take pictures, examine your house for it’s condition, specific improvements and amenities. You can help the appraiser by preparing a list of recent improvements and remodeling that has been done and include approximate amounts spent for each improvement.  Some appraisers will appreciate this information and some may not.  But if you already had the information prepared for buyers looking at your home, then providing it for the appraiser will be simple.

 

You: If the buyer of your house is getting an FHA or VA loan, there will be a few special requirements places on your house.  You scrape and paint all chipping or peeling paint on your house or any structures on the property.  You should also replace any missing or damages shingles and missing slats or blocks in your fence.

The lender will get a copy of the appraisal a few days after the appraiser has been to your home.  You may be told that the appraiser has some repair requirements before the lender can loan the buyer any money on your house.  If that happens, you will have to repair those problems and the appraiser will come back for a re-inspection for an additional cost.

 

The Bottom Line Is This: if your house doesn’t appraise for the sales price, the buyer can legally walk away from the deal.  It is very, very super important that you price your home correctly.

 

 

By the way, if you'd like to discuss how you can take advantage of all the great opportunities in this market feel free to call  (480) 430-9761or click here and let's talk.

 

Should you get a home warranty? And Why?

                                                         I always suggest a home warranty to buyers and sellers.  The home warranty is an insurance policy designed to protect the seller and buyer.  It protects the seller during the listing period and the buyer for one year after the close of escrow, against repair costs for mechanical systems and major appliances. 

.

The cost of the warranty is a one time fee which either the buyer or seller can pay at the close of escrow and it’s renewable annually. 

.

Depending on the company and the plan you choose your plan might include things like heating, air conditioning, dishwasher, washer, dryer, refrigerator, garbage disposals, pool and or pool and spa equipment.

.

Benefits of a home warranty:

• Replacement or repair of major or minor plumbing, heating or electrical problems during the policy period for a only a service fee.
• A full network of qualified technicians at your service
• Protection of your budget against unexpected expenses for repairs or replacements of systems in your home for the first year of ownership (or subsequent years if renewed).

By the way, if you'd like to discuss how you can take advantage of all the great opportunities in this market give us a call at (480) 430-9761or click here and let's talk.

 

Buying a newly built home? How to avoid pitfalls?

A home is a huge investment.  You owe it to your self and everyone in your house to make sure you’re making the right decision.  You’ll be happy that you did.

 

So, here are a few very important things you may not have thought of when buying a home from a builder.

 

1.      Make sure you read the Arizona Department of Real Estate Public Report provided to you.  By law this document must be given to you before you sign a purchase contract and you must sign a receipt for it.  The public report will tell you such things as:

 

 

·       Flooding and drainage disclosure

·       A description of adjacent land uses

·       Who provides electricity, telephone, gas, water and sewage disposal

·       Common community and recreation facilities

·       Assurances for completion of improvements

·       Local services and facilities, including schools, shopping facilities, public transportation, medical facilities, fire protection, ambulance service, police protection and garbage services

·       Taxes and assessments

·       Property owners association details

 

If you have questions about the public report you can call the Arizona Department of Real Estate 602-468-1414 extension 400.  The public report has a disclaimer by the Department of Real Estate. Read it carefully.

 

2.     Read your purchase contract carefully.  Note that if the builder or developer in not placing your earnest money deposit in escrow or a trust account, the funds may be placed in the builder’s or developer’s general funds account, and may be used for any purpose.  You could loose the money if the builder declares bankruptcy or goes out of business.  If the funds are not going to be placed in escrow or  trust account, that fact must be stated in a separate paragraph.  Make sure you know where your earnest money is going to be deposited.

 

3.     Before you sign a purchase contract, drive around the property for at least a mile or more in each direction to see how the surrounding area appears to you and what nuisances and hazards might be around the area.  Is there a storm drain or canal nearby that could be a hazard to your kids?  Visit the area at different times of the day, on weekends and evenings.  Disturbing noise and odors can travel farther at night.  In areas where there is a lot of vacant land nearby, check city or county zoning maps to see if nearby property is zones for apartments, industrial or commercial use.  The city and county planning and zoning departments are listed in the blue pages of your phone book.  Also check the Arizona Department of Transportation maps to find the nearest future freeway routes, and whether there are plans for road widening.  For info on viewing the maps call 602-255-7011.

 

4.     Call the school district that serves the subdivision to find out if the schools are accepting new students.   Some school districts, especially in the northwest part of the Phoenix area, have a cap on enrollment.  You might find out that your kids can’t attend the school nearest you and you’d have to take your kids to another community for school.

 

5.     Read the deed restrictions, also called the CC&Rs (covenants, conditions and restrictions).  You might find that some of the CC&Rs are very strict, especially those regarding landscaping, RV parking, play equipment, satellite antennas and other common amenities – especially when the subdivision is run by a home owner’s association.

 

6.     Check the home builder with the Arizona Registrar of Contractors.  You can find out the number of complaints customers have filed against the contractor, whether any are unresolved and whether the builder’s license has ever been suspended or revoked.  You can call the Registrar of Contractors at 602-542-1525.

 

.

By the way, if you'd like to discuss how you can take advantage of all the great opportunities in this market give us a call at (480) 430-9761or click here and let's talk.

Closing Costs – Who pays what?

 

Even though most costs in a real estate transaction can be negotiated between the buyer and seller, there are lots of costs that are traditionally paid by one party or the other.  

The list I made should be helpful for you

The seller can generally be expected to pay:

• Owners policy of title insurance
• Home owners assn. inspection fee
• Real estate commissions
• Escrow fee (50%)
• Pay off all existing loans, liens, and encumbrances
• Termite work
• Taxes due and payable or back taxes
• Recording charges (50%)
• Overnight delivery fees

The buyer can generally be expected to pay:

• Lenders policy of title insurance
• Endorsement fees for title insurance
• Escrow fees for title insurance
• Escrow fees (50%)
• Impounds and interest on new loan
• All new loan changes {including appraisal, origination and discount fees, document preparation, etc. }
• Fire insurance premium for first year
• Courier fees
• Homeowners association dues required by the association for future months

The following items are costs involved in the transaction that are negotiable and there is no general tradition as to which party pays them:

• Termite inspection fee
• Home warranty
• Homeowners association transfer fees

Mandatory costs: FHA and VA regulations require that the seller pay the following fees in an FHA or VA transaction, if applicable: assignment fee, flood certification fee, bringdown endorsements, document preparation fees, photo/inspection fees, tax service contract, warehousing fees, or any other loan cost or charge except the following: prepaid interest, impounds on new loan, loan origination, loan discount fees or appraisal. In addition, on a VA transaction the seller is required to pay the entire escrow fee.

By the way, if you'd like to discuss how you can take advantage of all the great opportunities in this market feel free to call at (480) 430-9761 or click here and let's talk.