Jim Little's Sun City AZ Real Estate Blog

Good news number one. Buyer activity has been so good the last couple of weeks that I didn’t get to post my Good News posts.

Two articles in today’s Arizona Republic were both Good News.

1. Trustees sale auctions now have increasing numbers of 3rd party buyers. 3rd party buyers have increased from 5% TO 12%. This means investors now have faith in the future of home sales in Arizona, and rcognize the present and future value of Arizona Real Estate.
2. Borrowers are now begining to contes foreclosures in court. Grounds given are that the lenders have failed to show good faith in attempts to modify loans, and have failed to show good faith in working with short sales. I hope this trend continues, and I hope legislatures at the state and federal level pass safe harbor legislation to hold harmless lenders and loan servicers from investor lawsuits if the servicer/lender does make the best possible modification or short sale. This will slow some of the foreclosures to a rate the market can better absorb.
3. Recent appraisals are coming with a 1004MC (Market Condition Report) showing stable a  or increasing market. Appraisers seem to think the bottom has arrived.

Jim Little, Your Sun City REALTOR®
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The Phoenix area real estate is rising from the ashes just like its namesake, the mytical bird.

The lowest priced homes, under $100,000 are selling withind a few days, often with multiple offers.

Bank owned homes, (REO) ar also selling very well. REO new listings have been averaging 4,000 per month. Pending sales in this category are currently 6000. Obviously, even the older, stale inventory is now being absorbed. As a side note, this means if there really is a “shadow inventory” of foreclosures that haven’t been listed yet, the market seems to be standing ready to buy them.

On a more local level, homes for sale in the Sun City neighborhood have decreased in the last couple of months, and sales + pending sales have increased, a sure sign of a recovery in its early stages.

New appraisals are coming in at or above contract prices, and the Market Condition Report appraisers are now required to file no longer defines properties as being in a declining market.

Interest rates, while still at an artificial low, are starting to creep up. If you are thinking about buying a home, do it soon. Historically, when interest rates reach a low, they will rebound to prior levels quickly. This rebound can be very dramatic. Interest affects buyer costs much more than the sales price over the term of a loan. It also limits the home you can buy on any given income. Act soon to take advantage of these very attractive rates.

The government First Time Buyer Tax Credit is working, bringing renters into the market. HUD is now allowing lenders to provide bridge loans so the tax credit can be used toward closing costs. This reduces the out-of-pocket expenses for a home buyer. It is important to note that this is for closing costs, not for down payment purposes as some reported in error.

Another promising piece of news, Friday 6/19/2009, large banks began paying back the TARP loans. It is nice to see this program seems to have worked, but 75% of the money loaned has yet to be repaid.

And last, it is a small step, but GM announced Friday the company would be recalling 900 laid-off workers. Just a drop in the bucket, but the right direction anyway.

Who can imagine the sheer terror the young men who invaded Normandy 65 years ago felt? I quake to simply think of it.

I live and work in Sun City AZ, and am honored to know some of the men and women who fought the battles of WWII.

It is my honor to know and serve these people.

1. Pending home sales are up 7% nationwide.
2. Credit Suisse reports real estate buyer activity is up 20-28% in the Phoenix market. Much of the activity is first-time buyers and investors. I have said often it is the first-time buyer who will lead the way and get us out of this recession.
3. Investors are paying CASH. It is the speculation and credit purchases of investment properties that caused many of our current problems. Cash investors will help us improve the market.
4. Low price properties are literally “Flying off the Market”
5. Buyers are now saying the bottom is near. (Personally, I think the bottom is past. In the last few weeks the extreme low prices no longer show up on the MLS. New listings of homes for sale are priced at a more reasonable value.)
6. Walmart announced it is adding 22,000 jobs nationwide, 1300 here in Arizona.

Jim Little, Your Sun City REALTOR®

The real estate market in Sun City is continuing to show signs of recovery. We have 708 active listings, 107 of which were sold in the month of May. The resulting absorption rate is 6.16 months of inventory. As I have said before, 6 months of inventory is a balanced market, favoring buyers and sellers alike.  Also important, the number of new listings and the number of listings sold has been relatively equal for April and May. I take this to be another sign of a return to normality.

My own observation is in order here. The “shiny pennies” are sold as soon as they hit the market. So are the “steals”. We are now back to the times when we would say to a prospective buyer, “the house you want to think about today was seen yesterday, who thought about it last night, and is writing an offer today.”

Jim Little, Your Sun City Neighborhood REALTOR®

As I mentioned in Friday’s post, the use of the first time buyer tax credit toward BUYING A HOME,  is a work in progress.

A very knowledgeable loan originator, Jeff Belonger in Cherry Hill NJ just posted a very good explaination of the rules as they are today. Rather than re-invent the wheel, see Jeff’’s post here.

Why does an agent in Sun City worry about first time buyers?  Because I also serve the family communities of Glendale, Peoria and Suprise AZ. All of these communities have excellent opportunities for the first  time buyer to own their own family home.

Jim Little, your Sun City Neighborhood REALTOR®

1. The Consumer Confidence Index improved 14% over the low in February. I have said for a year that confidence, more than anything else except affordability creates housing demand. Both measures are excellent today.
2. Nationally and locally, resale inventory is dropping(5% in the Phoenix metro, I’ll post June 1 with more detail on Sun City Neighborhood and surrounding communities.)
3. Buyers are now starting to chase listings, some homes for sale are getting multiple offers.
4. The Canadian dollar is still enjoying an advantageous exchange rate.
5. Last, but certainly not least, HUD has announced a rule that will allow FHA lenders to CREATE programs using the $8000 first time buyer’s tax credit for down payment and closing costs on FHA loans. This will be in the form of a bridge loan. Details are sketchy at this time, and each FHA lender will be creating their own programs. Be sure you and your agent investigate carefully.

Jim Little, your Sun City Neighborhood REALTOR®

It is Memorial Day, a perfect day to remember heros. I grew up amongst heros in San Diego, a Navy town. My father and the neighbors on either side of us, across the street, and up the street were all career men.

When my turn came, I enlisted 12/7/1964 serving until 12/6/1970. I reported to Fort Polk on my 19th birthday. Yes, I’ve had better birthdays.

I really miss my 33″ waist.

Back to my subject, you never forget your Drill Sergeant, Drill Instructor, etc. This frightning but dedicated individual took callous youths and made men and women out of them. They were respected, feared, and yes, sometimes hated by those they trained.

I am sure one thing never happened, they were probably never thanked for the lessons taught.

Today, I would like to correct this. Sgt Gooding, wherever you are, thank you. I have stood on your shoulders for my whole life, I hope I wasn’t too heavy.

Today, I am fortunate. I walk among heros every day. I live and work in Sun City AZ. home of many of the “Greatest Generation” veterans of WWII, Korea, and now Vietnam are my clients and customers. I occasionally get to serve active members who are stationed at Luke Air Force Base.

To all who have, are or will serve, my heartfelt thanks.

Jim Little, Your Sun City Neighborhood REALTOR®