Do You Have Multiple Photos?

The NAR is fond of publishing their research that shows homes advertised online with multiple photos get viewed 299% more often than those with only 1, or no pictures. We probably didn’t even need formal research to tell us that. Think about how you shop online. Doesn’t matter whether you’re shopping for a home or for a wrench or a pair of shorts. You want multiple pictures. You look at all the pictures available before making a decision about anything, let alone deciding which product to buy.

Why in the world doesn’t every home advertised in the MLS have multiple photos?? I guess we can excuse the lender owned homes. The Realtors working for lenders often don’t have more than a few minutes to photograph a new lender owned listing. Sometimes they don’t even have a key to get inside the house on the day they have to take the photos.

But for non-lender owned homes, there’s really no excuse for not having multiple photos.

I thought I’d just check, out of curiosity, and see how many of the condos and homes near my neighborhood have multiple photos. The dismal results are below.

• Condos & Townhomes, ZIPs 85020 & 85022 – 248 for sale, only 41 (or 16.5%) have more than six photos
• Homes and Patio Homes, same ZIPs – 620 for sale, 127 (or 20.4%) have more than six photos

If you’re thinking about selling your home and you plan to interview more than one Realtor, I’d suggest it’s important to ask how many photos the agent usually places on their MLS listings.

New – Search Phoenix Foreclosures

New search capabilities added to my Search the MLS page. You can now search North Phoenix lender owned homes. Click on over and check it out.

The search covers the ZIP codes of 85012, 85013, 85014, 85016, 85020, 85022, 85028, and 85032, which are the ZIPs I focus on the most. At posting time, there are 241 lender owned homes in Active status in these ZIPs. In the past 30 days, 82 of them have closed and currently 71 properties pending. That means there’s only a 2.9 months supply of these homes on the market. That’s a hot seller’s market!

Cash Buyer? Got Your POF?

POF? What’s that? Proof of Funds. By the way POF is an acronym I use, it’s not used by everybody or even by every Realtor or lender.

It might sound basic and redundant, but cash buyers sometimes don’t think about the fact that they really should provide a proof of funds statement when they make an offer to purchase real estate in the metro Phoenix region.

Why Use a POF?

There’s nothing in the Arizona Association of Realtors’ (AAR) Purchase Contract that requires that proof statement. But it’s just good business and a good idea to do so.

When buyers who are getting a mortgage loan make a purchase offer on a metro Phoenix property, they must provide a document called an LSR or Loan Status Report. It proves that the buyer has (at the very least) talked to a mortgage lender who verbally reviewed the buyer’s assets, liabilities and income and has come to a preliminary decision that the buyer is good for the loan. In fact the AAR Purchase Contract actually states on lines 62 and 63 that the Buyer’s LSR is attached to the purchase offer.

Cash buyers aren’t getting loans (of course) and so there’s no LSR to back up their ability to purchase.

Sellers are entitled to make a decision about accepting, countering or rejecting a Buyer’s purchase offer based on not only the price offered but the Buyer’s ability to pay for the home. Buyers who provide proof that their purchase funds are in liquid form present stronger offers.

With many bank owned homes in the metro Phoenix region selling in days or even hours, it’s important to demonstrate the strength of your offer right up front. The savvy seller/Realtor combination is going to counter an offer without a POF attached with a request for it anyway so it’s easier to get it done upfront.

What’s Sufficient as Proof of Funds?

Recent bank statements are the best and in this day of internet banking, are often the easiest to obtain. The statement should be dated within 30 days of your offer date.

Brokerage statements are a good POF too.

In my opinion, letters from your bank(er) are acceptable, but not nearly as convincing as the first two, which show not only that the Buyer has liquid funds, but where they’re located. A letter from a banker usually doesn’t specify just how liquid the funds are. The last thing Sellers (and Buyers for that matter) want is to get to the closing day only to find out that the Buyer’s purchase funds are in a retirement account that can’t be touched for weeks.

Your Realtor should be careful to obscure all account numbers, personal ID numbers, social security numbers and the like from the POF document. Really with-it Realtors shred these documents when the deal is complete and before putting the file into archives. I provide client with a short video of me shredding their documents as part of my closing gift.

Got POF? Then let’s shop!  Search the metro Phoenix MLS here

See all entries in the FAQ files here.

AmeriDream’s End

A provision of the recently enacted housing stimulus package kills of Down Payment Assistance programs as of October 1, 2008. (read more at AmeriDream’s website)

Another provision of the bill raises the minimum down payment on an FHA loan from 3% to 3.5%.

Hmmmm….. we’re in the middle of the biggest housing downturn in decades,  banks are nervously tightening up lending standards and so lending to fewer people, there’s a glut of vacant foreclosed homes on the market which are dragging down the value of every home, and many sellers are so anxious about not selling that they’re more than willing to help a buyer with the down payment.

Amidst all this Congress decides it’s a good time to say “No, you have to save even more,” and “the seller can’t help you, even if they want to.”

Yep, sounds about like our Congress. <shaking head in disbelief>

I’ve done a lot of DPA loans; several where I represented the seller. In each case, the seller was happy they finally got their home sold at all, given the current market. Many of these sellers told me that while they wish they didn’t have to give any concessions to the buyer, at least they felt good that the money they gave up went to the worthy cause of helping someone else step into the American Dream of home ownership.

On the bright side, I’m hopeful that HR 6994, a.k.a. the FHA Seller-Financed Downpayment Reform and Risk-Based Pricing Authorization Act of 2008 will be passed into law soon and DPAs will be back. HR 6994 re-authorizes DPAs and mollifies the naysaysers by letting HUD charge risk-based insurance premiums on the mortgage loans.

Sunday Stats

photo credit to MiamiAmia,  via StockExchange

Click here to link back to last week’s stats or click here to see the entire series.

This week’s chart is below. As always, red indicates the value moved in the ‘wrong’ direction (away from a balanced market), while green means the value moved towards a balanced market.

It’s interesting to note that most of the red in the “Months of Inventory” column is in the ZIPs that lay closest to the central Phoenix business corridors, while most of the green in this column is in the outlying ZIPs farther from center city.

I’ve always felt that central Phoenix is due for a renaissance as homeowners realize that a large, new McMansion far from the city isn’t such a great deal if you spend several hours a day in the car commuting to work in the downtown corridors.

I’ve even heard some homeowners state this idea out loud: “Sure my house is 40 years old and it’s got a few issues like any old house would, but I’m only 10 or 15 minutes from work, so that tradeoff works for me. More time with my family trumps a bigger house.”

This week’s chart doesn’t support that theory at all. Of course, looking at weekly stats kind of gives one a “can’t view the forest for the trees” perspective, so I’ll hang on to my theory for now and just keep watching the numbers.

Related Posts:

Chris Butterworth says Rising Gas Prices Won’t Kill the Suburbs

Zillow Says Homeowners In Denial

• 77% of the homes in the nation have decreased in value during the 2nd quarter of 2008
• 62% of homeowners believe their home has increased in value

Source: Zillow’s new survey

Why the disconnect? It’s a variant of the NiMBY phenomenon (“Not in My Back Yard”). Survey 1000 homeowners about whether we should build a new landfill, create some more low income housing, or build another nuclear reactor or oil refinery to reduce our dependence on foreign oil. The answer you’ll  hear from most of those folks is “Sure, we need that,” followed by a quick “but don’t build it near my home.”

It’s the same with home values. We all hear the media stories about declining home prices. But every time I go on a listing appointment, the sellers are disappointed, shocked and angry when I start recommending a listing price based on the recent sold prices.

I’m in denial myself. I refuse to believe that my beautiful, upgraded condo with gorgeous wood flooring and a stunning mountain view and all those other little extras…. I refuse to believe that my home is only worth $160,000 now when it was worth $180,000 last winter, $200,000 a year ago and $220,000 eighteen months ago.

Here’s the key: My condo is not for sale. I don’t plan on putting it up for sale. So I can happily stay in denial for as long as I like. Until and unless a home is listed for sale, it doesn’t really matter what the homeowner thinks it’s worth.

Homeowners, I say be in denial about how much or how little your house is worth. Just don’t be for sale at the same time.

A Monsoon Hangover – Blooms!

When is a hangover beautiful?? When it’s a monsoon.

One of the gorgeous side effects of the Valley’s monsoon rains is the blooms in the desert.  “In Arizona, we typically experience monsoon storms during the summer. Humidity levels increase, and the season is marked by wind storms, dust storms, and periods of heavy desert rains.” (from About.com)

It’s really quite beautiful to drive around the Valley and see the newly green landscape spread out before you as you crest a hill. As a kid I loved our very rare cloudy days and spent them looking forward to the rain which would wash the sky into an unbelievable cerulean blue and stripe the cedar fence marking our back property line with gorgeous deep-mahogany splashes of color. It was all set off by the nearly neon green hue of the putting green grass in the manicured section of our 1/3 acre.  Ahhh.

OK, out of my childhood and back to monsoons….

Much of the Phoenix area’s annual 7 inches or so of rainfall comes in the monsoon season. The definition of ‘monsoon’ has changed just this year. It used to be that the monsoon arrived when there were 3 days in a row with a dew point of 55 degrees or higher. This usually happened in mid-July and continued through mid-September.

Since nobody really understands what a dew point is anyway (insert tongue in cheek ) it’s a good thing the rule has been changed as of 2008. The monsoon season now lasts from June 15 to September 30 each year. 2008 has been the wettest monsoon in recent years.

What’s a dewpoint? Wikipedia gives a nearly unintelligible definition. Weather.com does better (on a redirect to the National Weather Service): “Dewpoint is the temperature at which air becomes saturated and produces dew.”

Despite the heat, the Valley’s landscape comes alive during the monsoon, storing water to get through our dry and (relatively) cold winters. It makes for beautiful Sunday drives.

Want to see another monsoon photo? Or more photos of the Valley in general? See my partner’s site, Chris Butterworth of Butter Homes and his Moving Stills series. Or, try About.com’s photo album of Phoenix dust storms. This link also provides an excellent article series about the Valley’s monsoons, if you’re interested.

Don’t miss out on the psychedelically cool monsoon maps at the weather.com link above!

.

.

.

And by the way, folks make candy out of the ruby red cactus “flowers” pictured above. The quintessential confectioner is local favorite Cactus Candy, but they don’t do online orders. It’s worth the phone call. But if you simply must order via the web, you can buy these red jelly candies from DesertUSA.com

2 Downtown Hi Rise Condos Having Trouble

The Arizona Republic reports on problems at two downtown hi-rise condos. Both the Landmark Towers (formerly the Camelback Towers) and the Orpheum Lofts seem to be having problems. Original purchasers at both downtown hipster abodes now say they were mislead each developer’s condo conversion plans.

The Landmark Towers was renovated in 2004. In 2005, Crown Pacific Properties converted them from the original luxury apartments into 238 individual condos ranging from 440 square feet to just above 1,100 square feet. You can still view the June 2007 YouTube video hosted by Desert Living magazine featuring their editor David Tyda.  Original purchasers say they were led to believe the building received a structural overhaul to match the cosmetics. Turns out the building’s cooling system is largely original and the plumbing isn’t keeping up with modern day water demands. There are currently 20 condos for sale in the MLS for $81,000 to $330,000. Nothing has sold there since November 2007 when a 720 square foot unit with a beautiful north facing view sold for $190,000.

The Orpheum Lofts were famously converted into condos from the historic landmark formerly known as the Phoenix Title and Trust Building. Located at the corner of Adams Street & 1st Avenue, it was built in 1931 and is one of the few remaining Art Deco buildings in the metro region. The developer advertised 90 lofts ranging from 700 to 1,800 square feet. Orpheum dwellers believed their condo purchase included parking on a surface street lot next door. But a developer is now building more condos on that next door parking lot and owners are renting spots from other nearby garages. Originally priced from the mid-$300′s, there  is only 1 Orpheum Loft listed for sale now, at $167,900 for a 1-bedroom. Interestingly, there isn’t much for sale at the Orpheum. There have only been 4 for sales all year. One closed, one is still for sale and the other two units expired without selling.

Interested in purchasing at the Landmark or the Orpheum? Call or email me!

Related Posts

• Update on the Landmark Towers A/C System
• Century Plaza Condos

Sunday Stats

photo credit to MiamiAmia,  via StockExchange

Click here to link back to last week’s stats

Here’s this week’s numbers. Overall, we inched a minute amount in the right direction – less total months of inventory on the market.

As always, a red means the number moved in a negative direction over last week, while green means positive movement towards a balanced market.

Want to receive these updates by email? Send me an email with “Sunday Stats” in the subject line. No email spam and I do not sell, rent, share or trade your email address to anyone. Ever.

The fine print: I include all property types (homes, patio homes, townhouses, and condos) and I go back to one day later in the prior month (i.e. today I went back to Jul 11).

Trump to Buy Ed McMahon’s Home

I missed this news entirely because I’m not so much into the pop culture. It seems that Donald Trump is in negotiations to buy Ed McMahon’s house and allow Ed to continue living there as a renter.

In the current down market, The Donald can get a bargain price on a sweet SoCal house. He gets a monthly income stream from Ed McMahon’s rent. Not to be crass, but Ed McMahon is old – he can’t live forever. He’ll happily spend his remaining years in a house he loves. When Ed passes, The Donald still owns the house and the market likely will have improved. He can sell and pocket the profit. Plus, he gets to appear magnanimous in the news in the meantime.

What a great idea, Trumper! This translates to any price range; it needed be only multi-millionaires who work out this kind of deal. This is a great example of how folks with a little ready cash can benefit from our down real estate market and gain a little good karma while they’re doing it.

Century Plaza Condos

Century Plaza is an interesting new hi-rise condo development at the intersection of Osborn & Central Avenue (ZIP code 85012), and there’s a lot for sale there. Pricing goes from the high $200,000′s to $1.5 million, see more info on this below.

Originally built in 1974 as an office tower, it was completely gutted and rebuilt starting in 2006 by Equus Development Corporation (dba Windsor Century Plaza, LLC). The Century Plaza site offers condos from 734 to 2,911 square feet with current asking prices starting in the high $200′s and going up to over a million.

The views are stunning and one reason for that is that setback regulations in the 1970′s allowed buildings much closer to Central Avenue than today’s setbacks allow. The effect from the upper floors is almost like you’re floating above Central Avenue!

The Osborn light rail stop is literally outside the lobby doors and with the light rail scheduled to begin regular operations this December, residents will have easy access to downtown & Tempe.

Each condo has 11 foot ceilings, 8 foot doors, a shaded balcony off the living room and master bedroom. The site boasts private covered parking, secure key-card access, concierge service, a 24/7 clubhouse and fitness center and a unique Car Share program for urbanite owners who want to use a car once in a while but not foot the maintenance and storage costs. Upscale retail shops were built into the ground floor. (I’m not sure the Car Share program is up and running yet. Phoenicians are pretty addicted to our cars, so it’ll be really interesting to see how this idea takes off.)

After many construction delays, the tower is finally complete. The builder’s reps are still onsite, selling never lived in units. List prices currently start at $291,000 for a 3rd floor, extra large 1 bedroom. Expect to drop at least a cool million for 1600 or 1700 square feet on the upper floors. The current high list price is $1,449,000 for 1700+ square feet with a panoramic view from the 16th floor.

Think urban loft living is right for you? Contact me for a private tour, or just for more information. Just want to see downtown hi-rise condos on an MLS search? Email or call and I’ll setup a custom search for you which will email you whenever anything that suits your needs hits the market. Heather@NorthPhoenixAgent.com or 602.999.8831

This is probably an appropriate spot to remind readers that you absolutely need a Realtor to represent you when you buy from a builder! The builder has sales reps onsite who are lovely, helpful and charming people. They will tell you they’ll “make sure you get what you ask for” but the builder’s sales reps work for the builder. Their job is to sell inventory and they have no obligation to protect your interests.

A colleague of mine tells a story of working with a buyer who bought a condo from a builder. The buyer intended to work from home and needed a condo with quiet neighbors. The builder’s rep assured the buyer the condo was quiet as far as she knew. The buyer’s own Realtor visited the condo one weekday about 10am, only to hear a trumpet being practiced (loudly!) next door. Turns out the neighbor played for the Phoenix Symphony and practiced at home daily. The builder’s salesperson never mentioned that to the buyer.  The builder’s rep actually didn’t do anything wrong – she had no obligation to disclose the noisy neighbor because her duties were to sell condos for the builder. She had no duty to protect the buyer’s interests.

Had that buyer used the builder’s Realtor instead of hiring his own…… hmmmm. Earplugs, anyone?

Related Post – 2 Downtown Landmark Hi-Rises Having Trouble

17% of US Homes For Sale are Lender Owned

RealtyTrac released data for July 2008 that shows that nearly 1 of every 5 US homes for sale is owned by a bank (a.k.a. “REOs”).

I’m loving the data-crunching capabilities of the new MLS software so much that I thought I’d check on the percentage of Phoenix area homes for sale which are lender owned.  There are 53,767 metro Phoenix area homes for sale today, and only 3,886 of them are coded “Lender Owned Property” in the MLS. So according to that, only 7.2% of Phoenix area homes for sale are lender owned.

That seems reasonably accurate, just based on the anecdotal mental evidence I gather by scouring the MLS daily for my seller and buyer clients. On the other hand, RealtyTrac’s nifty color-coded map of foreclosure activity shows Phoenix is a hotbed of foreclosure activity (no surprise there).

The MLS data does suffer from garbage in, garbage out syndrome. If the listing agent doesn’t check the little data box for “lender owned property” when they enter the home for sale into the MLS, it won’t show up properly in user’s searches.

I also checked for the number of short sale properties for sale – only 2.6%, or 1,413 homes. That seems low. Again, just based on my mental picture of the MLS based on the fact that I look at it daily. I suspect that many agents don’t check the proper data box when entering their short sale listings into the MLS and the percentage is actually higher.

Regardless, I thought my readers would find this little statistical gem interesting. Want more statistical analysis of the MLS data that fits your situation? Call or email me.

Related Posts

1. Month End Sales Stats for the Valley
2. Monthly & Yearly Stats by my Broker, Jay Thompson
3. All About Foreclosures

Want to receive these updates by email? Send me an email with “subscribe to blog” in the subject line. No email spam and I do not sell, rent, share or trade your email address to anyone. Ever.

Fixing Your Credit? Here’s a Great Resource

I’ve been reading CreditBloggers in my feedreader for a while now and finally (Doh!) it dawned on me that my readers might find the site useful. I’m adding it to my blogroll and linking to them here.

Need to fix your credit? Want to understand more about how the credit scoring system works? Want reliable information on credit scams? Check out CreditBloggers.

Related Posts – Find A NonProfit Credit Counseling Service Near You

First-Time Home Buyer Tax Credit Fact Sheet

The following information is courtesy of Andrew Little, a favorite lender of mine. His team is super sharp, are excellent communicators, and have their fingers on the pulse of the first time homebuyer market in the Valley.

Contact info: Andrew Little, Sales Manager, Countrywide Bank FSB. 480-384-4012. www.aLittleMortgage.com or Andrew_Little@Countrywide.Com

Part of the Housing Stimulus bill passed in late July is a tax credit to first time homebuyers. Here’s the breakdown of the in’s and out’s of the bill.

Who is Eligible

• The $7,500 tax credit is available for first-time home buyers only
• The law defines a first-time home buyer as a buyer who has not owned a home during the past three years
• All U.S. citizens who file taxes are eligible to participate in the program

Income Limits

• Home buyers who file as single or head-of-household taxpayers can claim the full $7,500 credit if their modified adjusted gross income (MAGI) is less than $75,000
• For married couples filing a joint return, the income limit doubles to $150,000
• Single or head-of-household taxpayers who earn between $75,000 and $95,000 are eligible to receive a partial first-time home buyer tax credit
• Married couples who earn between $150,000 and $170,000 are eligible to receive a partial first-time home buyer tax credit
• The credit is not available for single taxpayers whose MAGI is greater than $95,000 and married couples with an MAGI that exceeds $170,000

Effective Dates for the Tax Credit

• First-time home buyers would receive a $7,500 tax credit for the purchase of any home on or after April 9, 2008 and before July 1, 2009
• To qualify, you must actually close on the sale of the home during this period

Tax Credit is Refundable

• A refundable credit means that if you pay less than $7,500 in federal income taxes, then the government will write you a check for the difference
• For example, if you owe $5,000 in federal income taxes, you would pay nothing to the IRS and receive a $2,500 payment from the government
• If you are due to receive a $1,000 tax refund from the government, your refund would grow to $8,500 ($1,000 plus $7,500 from the home buyer tax credit)
• Buyers can take the tax credit in their 2008 or 2009 tax return
• If you purchased the home in 2008, the tax credit is taken on your 2008 tax return. If you buy in 2009, you have the option of taking the credit on your 2008 or 2009 tax returns.

Types of Homes that Qualify for the Tax Credit

• All homes, whether single-family, townhomes or condominium apartments will qualify, provided that the home will be used as a principal residence and the buyer has not owned a home in the prior three years. This also includes newly-constructed homes.

Payback Provisions

• The tax credit essentially serves as an interest-free loan to be repaid over 15 years
• For example, a home buyer claiming a $7,500 credit would repay the credit at $500 per year. However, the buyer doesn’t have to start repaying the credit until two years after the tax year in which the credit is claimed.
• If the home owner sold the home, then the remaining credit would be due from the profit of the home sale.
• If there was insufficient profit, then the remaining credit payback would be forgiven.

For more details on the tax credit, go to www.federalhousingtaxcredit.com

Related Posts

1. Housing Stimulus Package Passed
2. Don’t Have Down Payment Money? Maricopa County Could Help

Stats on Sundays

photo credit to MiamiAmia,  via StockExchange

Here’s this week’s numbers, broken out as always by ZIP code. Click here for last week’s numbers.

The collective North Phoenix ZIP code areas show continued movement in the right direction for achieving a balanced market. As I’ve been saying for months, we’ve got a long way to go but are making slow & steady headway. A correcting real estate market is like a New Year’s Resolution diet.

85012 is just sticking out like a sore thumb! Sixteen months of inventory on the market means buyers have a strong upper hand in negotiating price and terms. 85012 covers the territory between Central Avenue and 7th Street, and from Glendale to Thomas. Included in this area are a lot of the downtown hi-rise lofts, and the Light Rail construction is almost certainly scaring off prospective buyers. But with sellers getting more realistic about pricing, and the Light Rail set to begin operations this December, the ZIP’s stats should start improving this fall, winter and next spring.

Are you a prospective buyer looking for a great deal? ZIP 85012 just might be the thing for you. You can absolutely drive a hard bargain with sellers here. The hi-rise condos located at or near Light Rail stops (like Century Plaza and Tapestry on Central especially) represent an outstanding future value. As the Phoenix market finishes correcting and as Light Rail and ASU’s downtown campus bring more cache to urban dwelling, these hi-rises are bound to boom in value. Don’t expect prices here to rebound by next year by any means. But buyers who can buy in 85012 during the next 6 to 9 months and then hold the property for 4 to 7 years could get in on the ground floor of something really valuable!

Pricing for hi-rise Central Ave condos in 85012 run the gamut from the $80,000 to $120,000 range for smallish, lender owned 1 bedrooms at the Landmark Towers, up to the $1,000,000 plus mark for 1700 or 1800 square feet with panoramic views at the Summit At Copper Square or the Century Plaza.

Want a list of bargain priced condos in ZIP 85012? Email me and I’ll set you up with a search pronto.

Want to receive these updates by email? Send me an email with “Sunday Stats” in the subject line. No email spam and I do not sell, rent, share or trade your email address to anyone. Ever.

The fine print: I include all property types (homes, patio homes, townhouses, and condos) and I go back to one day later in the prior month (i.e. today I went back to Jul 11).