Phoenix Real Estate News and Information

Realtors: We Overcounted Home Sales for Five Years - US Business News

2011-12-13T21:22:00.001-08:00

Data on sales of previously owned U.S. homes from 2007 through October this year will be revised down next week because of double counting, indicating a much weaker housing market than previously thought.
CNBC.com
The National Association of Realtors said a benchmarking exercise had revealed that some properties were listed more than once, and in some instances, new home sales were also captured.
"All the sales and inventory data that have been reported since January 2007 are being downwardly revised. Sales were weaker than people thought," NAR spokesman Walter Malony told Reuters.
"We're capturing some new home data that should have been filtered out and we also discovered that some properties were being listed in more than one list."

via cnbc.com

This is not good and makes no sense that they didn't think of this sooner. Calls into question their other numbers now. The NAR just got a big black eye.

Home sales fall to 2011 low; few 1st-time buyers

2011-06-21T13:23:00.001-07:00

WASHINGTON (AP) -- Fewer people bought previously occupied homes in May, lowering sales to their weakest point of the year.

Home sales sank 3.8 percent last month to a seasonally adjusted annual rate of 4.81 million homes, the National Association of Realtors said Tuesday. That's far below the roughly 6 million annual sales rate typical in healthy housing markets.

Since the housing boom went bust in 2006, sales have fallen in four of the past five years. Analysts say they expect sales to level off at about 5 million a year. That's not much better than the 4.91 million homes sold last year, the worst showing in 13 years.

The depressed housing market has weighed on the broader economy. Declining home prices have kept people from selling their houses and moving to find jobs in growing areas. They have also made people feel less wealthy. That has reduced consumer spending, which drives about 70 percent of economic activity.

One sign of the housing industry's struggles is that fewer first-time buyers are entering the market. The number of first-timers ticked down to 35 percent of sales last month. In healthy times, they drive about half of sales.

First-time buyers are critical because they tend to improve their properties and invest in their communities, a combination that raises home values. And their purchases allow sellers to move up to pricier homes.

Instead, the market has been saturated with foreclosures, which force prices down. Sales of homes at risk of foreclosure fell in May. But they still made up 31 percent of all purchases. And many pending foreclosures are backlogged in the courts or held up by state and federal probes into questionable foreclosure practices by lenders.

Until the glut of foreclosures are cleared and people think it's a safe time to buy, "it is unlikely that home prices can recover on a sustained basis," said Steven Wood, chief economist at Insight Economics.

Bigger required down payments, tougher lending rules, heavy credit-card and student-loan debt and a shortage of desirable starter homes are keeping many would-be buyers away. Even some who do have enough money for a down payment and a solid credit history are holding off, worried that home prices will keep falling.

Investors are filling some of the void. They are spending cash to scoop up deeply discounted homes in hard-hit areas of Phoenix, Las Vegas and Tampa. Last month, investors accounted for 19 percent of all sales.

All the while, previously occupied homes are cheap and in great supply.

Re-sold homes are a bargain compared with new homes. The median sales price for a previously occupied home in May was $166,500. The median price of a new home is nearly 31 percent higher than the price for a re-sale -- around twice the normal markup.

The gap is largely due to the flood of foreclosures and short sales. (Short sales occur when lenders accept less than what's owed on the mortgage.) A record 1 million homes were lost to foreclosures last year. And foreclosure tracker RealtyTrac Inc. expects 1.2 million more will be lost this year.

Another problem for the housing market is the glut of unsold homes. In May, the supply fell slightly to 3.72 million homes. At last month's sales pace, it would take more than nine months to clear those homes.

Homes priced for less than $100,000 are selling briskly, but more expensive homes are having trouble finding buyers. Analysts say a healthy supply can be cleared in six months.

The situation is worse when taking into account the "shadow inventory" of homes, economists say. These are homes that are in the early stages of the foreclosure process but, because of backlogged courts or the government probes, haven't hit the market for re-sale.

Sales fell across most regions in May. Sales dropped 6.4 percent in the Midwest, 5.1 percent in the South and 2.5 percent in the Northeast. There was no change in the West.

Arizona Ranked #22 overall for freedom.

2011-06-13T10:41:00.001-07:00

Check out the George Mason University study at http://mercatus.org/freedom-50-states-2011/AZ

JPMorgan expects home prices to dip « HousingWire

2011-06-11T07:32:00.001-07:00

Friday, June 10th, 2011, 7:54 am

JPMorgan (JPM: 41.05 +0.17%) predicted a further dip in home prices this past month, forecasting another 4% to 5% drop in home values between now and mid-2012.

In its June 2011 Home Price Monitor Report, the bank lowered its base home price forecast to a level that's 37% under peak price levels.

The financial services firm blames its lowered price expectations on a supply-and-demand imbalance, as well as anemic consumer demand and disappointing economic reports.

The good news is CoreLogic's home price index grew a slight 0.7% in April, which shows some signs of possible price stability, JPMorgan said.

But home prices still declined more than anticipated in the first quarter, reaching a new post-2006 low, the bank said.

Making matters worse, JPMorgan's Home Price Monitor report points to a 12% drop in pending home sales in the month of April.

The bank said "a looming question is when and if lending standards will ease enough to boost demand."

Write to Kerri Panchuk.

via housingwire.com

Daily Real Estate News

2011-06-10T08:19:00.001-07:00

Report: Real estate market won't hit bottom this year
Nearly half of all sales are distressed
By Inman News
Inman News™

Home values fell 8 percent year-over-year in April, according to a report from property search and valuation site Zillow.

Zillow's Home Value Index is now down 29.5 percent, to a median $169,588, from its peak of $240,656 in June 2006. That's equivalent to the index's level in May 2003, the report said.
Of 132 metro areas tracked, only three saw year-over-year appreciation: Honolulu (1 percent); Pittsburgh (0.9 percent); and Fort Myers, Fla. (0.5 percent). Nearly half saw double-digit decreases.
Homes in Ocala, Fla., lost the most value (-19.9 percent), followed by Manchester, N.H.; and Gainesville, Ga. (-16.5 percent each).

Month-to-month depreciation slowed slightly in April compared to late 2010. From March to April, the index fell 0.8 percent, compared with a 0.9 percent dip between November and December.

"In general, current trends are consistent with our earlier expectations of depreciation rates improving in the spring but from absolute levels that are high enough and at a pace that is slow enough that a bottom won't be reached this year," said Stan Humphries, Zillow's chief economist, in a statement.

"Key drivers at this point are the pace of foreclosures and improvement in the employment picture."

Depreciation was sharpest in the least expensive one-third of homes, which fell 1 percent month-to-month and 15 percent year-over-year, to a median value of $93,100. Values among the middle tier of homes declined 0.8 percent month-to-month and 8.7 percent year-over-year, to a median $157,600.
The most expensive third dipped 0.7 percent month-to-month and 4.9 percent year-over-year, to a median $293,500.

The rate of homes lost to foreclosure -- those repossessed by the lender or sold to a third-party at auction -- remained flat year-over-year at 10 of every 10,000 homes.

"This rate is substantially higher than the recent low point reached in December 2010, when 8.8 per 10,000 homes were liquidated, but also less than the high point of 11.3 per 10,000 homes, reached in October before the foreclosure slowdowns began," Humphries said.

Foreclosure resales rose for the 10th straight month in April, to 24 percent of overall sales, up from 16 percent in April 2010. That figure doesn't include short sales, which Zillow said accounted for an equal share of transactions in April.

Copyright 2011

Wow, the bad news just keeps coming.

My Way News - Americans' equity in their homes near a record low

2011-06-10T06:53:00.001-07:00

WASHINGTON (AP) - Falling real estate prices are eating away at home equity. The percentage of their homes that Americans own is near its lowest point since World War II, the Federal Reserve said Thursday. The average homeowner now has 38 percent equity, down from 61 percent a decade ago.
The latest bleak snapshot of the housing market came as mortgage rates hit a new a low for the year, falling below 4.5 percent for a 30-year fixed loan. But even alluring rates have failed to deliver any lift to the depressed housing industry.
The Fed report is based on data from the first quarter of this year. Another report last week found that home prices in big cities have fallen to 2002 levels.
Normally, home equity rises as you pay off the mortgage. But home values have fallen dramatically since the bubble in prices burst in 2006. So many homeowners are losing equity even though the outstanding balance on the loan is getting smaller.

(AP) In this Feb. 4, 2011 file photo, a part of the JP Morgan Chase building reflects in its...
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Nicole Rosen's home in tiny Spanaway, Wash., just outside the military base where her husband works, has lost $150,000 in value since she paid $275,000 for it in 2006. She has battled mortgage lenders in court for two years to stay out of foreclosure. In the meantime, the couple are paying off credit cards, figuring it's the only "positive thing we could do."
"We're paying off all our debt. We only have $200 left on our credit cards. But we're stuck in our house," Rosen said.
Home equity is important for the economy because it has a lot to do with how wealthy people feel. If they feel swamped by a mortgage loan, they're less likely to spend freely on other things. Home equity also serves as collateral for some loans.
There are 74.5 million homeowners in the United States. An estimated 60 percent have a mortgage. The rest have either paid off the loan or bought with cash.
Of the people who have mortgages, 23 percent are "under water," meaning they owe more on the mortgage than their home is worth, according to the private real estate research firm CoreLogic. An additional 5 percent are nearing that point.

(AP) Chart shows quarterly statistics on household net worth
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The outlook for the housing market remains dim.
Fixed mortgage rates average 4.49 percent, extremely low by historical standards, and have fallen for eight straight weeks. But most people can't meet tougher lending requirements. Falling rates make it easier to refinance, too, but many of the people who can afford to do that already have.
And foreclosures keep hammering the housing market. On Thursday, the Obama administration said the three largest U.S. lenders - Wells Fargo, Bank of America and JPMorgan Chase - haven't helped enough people lower their mortgage payments to stay in their homes.
The government said it has started withholding the cash incentives it established for lenders under its 2-year-old foreclosure prevention program. The administration had hoped the program would prevent as many as 4 million foreclosures, but it has helped fewer than 700,000 people.
Foreclosures have economic ripples: Homes in foreclosure sell at a 20 percent discount on average, and those discounts erode prices throughout a neighborhood.
Many foreclosure sales have been delayed while federal regulators, state attorneys general and banks review how those foreclosures were carried out over the past two years. When those foreclosures go through, prices may fall even further.
Home prices are expected to keep falling until the number of foreclosures for sale is reduced, companies start hiring in greater force, banks ease lending rules and more people think it makes financial sense again to buy a house. In some areas of the country, that could take years.
The Federal Reserve report found that Americans' overall net worth grew 1.65 percent in the January-to-March period, to $58.06 trillion, mostly because of stock market gains. Most of those gains have been erased since March, though.
Net worth is the value of assets such as homes and stocks, minus debts like mortgages and credit cards.
The report found household debt declined at an annual rate of 2 percent from the previous quarter, mostly because of a decline in mortgage debt, which has fallen for 12 straight quarters.
But the decline is deceiving. Mortgage debt is coming down because so many Americans are defaulting on payments and losing their homes to foreclosure, not just because people are paying off loans.
"A lot of this debt reduction is not voluntary," said Dana Saporta, director of U.S. economics at Credit Suisse.
The Fed report suggests the average household owes about $119,000 on mortgages, credit cards, auto loans and other debt.
Debt now equals 119 percent of the money Americans have left over after taxes. In late 2007, when the country was binging on debt, it was 135 percent. In the healthier 1990s, it was roughly 90 percent.
Auto loans, student loans and other consumer credit rose 2.4 percent during the quarter, a second straight gain. Analysts say more people, many of them unemployed, are borrowing money to attend school.
The Fed's quarterly report documents wealth, debt and savings for corporations, governments and households. It covers most of the financial transactions that take place in the United States.
It found that corporations are still hoarding cash. Excluding banks and other financial firms, companies held $1.9 trillion in cash at the end of the quarter. That was slightly more than in the previous quarter and set another record.
The reluctance of companies to spend more of their cash helps explain why job growth has been slow since the recession ended. The unemployment rate is 9.1 percent, slightly higher than when the year began.
Household net worth in America is up nearly 19 percent from early 2009 but still about 11 percent below its peak in 2007. Normally, greater wealth would spark consumer spending. But the lost home equity is counteracting it.
Per household, it comes to about $518,000. But the gap between the super-rich and everyone else in the United States has grown over the past three decades. So while average wealth is increasing, most Americans don't feel the difference.
---
AP Business Writer Matthew Craft in New York contributed to this report.

via apnews.myway.com

40% of underwater borrowers took cash out of homes

2011-06-09T08:18:00.001-07:00

40% of underwater borrowers took cash out of homes
CoreLogic: Owners with home equity loans more than twice as likely to be upside down
By Inman News
Inman News™

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Homeowners with home equity loans are more than twice as likely to be "underwater" as those who didn't take cash out of their homes, according to statistics compiled by real estate and loan data aggregator CoreLogic.
CoreLogic estimates that at the end of March, 22.7 percent of homeowners with mortgages -- about 10.9 million borrowers -- owed more on their mortgage than their home was worth. That's down slightly from an estimated 11.1 million underwater borrowers at the end of December.
Falling home prices can put borrowers who have little equity in their homes underwater. By allowing homeowners to convert equity they have in their homes into cash, home equity loans reduce the cushion borrowers have against price declines.
CoreLogic said that 38 percent of borrowers with home equity loans were underwater at the end of March, compared with 18 percent of homeowners who had no home equity loan. More than 40 percent of all underwater homeowners (4.5 million) have home equity loans, CoreLogic said.
As might be expected, CoreLogic found that the presence of a home equity loan also increased the amount of negative equity. Underwater homeowners who had taken out home equity loans owed $83,000 more than their home was worth, on average, compared with $52,000 for those who hadn't taken cash out of their home.
Past studies have shown that the higher a borrower's combined loan-to-value ratio (CLTV), the more likely they are to stop making payments on their loan. In many cases, borrowers will opt for a "strategic default" -- not because they can't afford the monthly payments, but because they don't believe their home will regain its value anytime soon.
CoreLogic found that borrowers with home equity loans were slightly more likely to default at "moderate" levels of negative equity, up to 115 percent CLTV. Beyond that point, the relationship reverses, and default rates were slightly higher among homeowners without home equity loans.
Among all underwater borrowers nationwide, the average amount of negative equity was $65,000. In states with higher-cost housing, the average was considerably higher. In New York, underwater borrowers had an average of $129,000 in negative equity, followed by Massachusetts ($120,000), Connecticut ($111,000), Hawaii ($98,000), and California ($93,000).
At the other end of the scale, underwater borrowers in Ohio had the lowest negative equity -- $31,000, on average -- followed by Indiana ($34,000), and Minnesota ($38,000).
Nevada led all states in the proportion of underwater borrowers -- 63 percent of Silver State homeowners with mortgages owed more than their home was worth -- followed by Arizona (50 percent), Florida (46 percent), Michigan (36 percent), and California (31 percent).
At the metro level, Las Vegas led the nation, with 66 percent of mortgaged properties underwater, followed by Stockton (56 percent), Phoenix and Modesto (55 percent), and Reno (54 percent).
Metropolitan markets located outside of the five states with the highest negative equity shares include Greeley, Colo. (38 percent); Boise (36 percent); and Atlanta (35 percent).

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Half of Arizona mortgages still underwater | Phoenix Business Journal

2011-06-08T15:17:00.001-07:00

More than 652,000 -- or about half -- of Arizona mortgage holders, are "underwater," or owe more than their homes are worth, according to a CoreLogic report released Tuesday.

The total represents about 49.6 percent of the total housing mortgages in Arizona, which has the second-highest rate of underwater mortgages in the nation.

The CoreLogic (NYSE: CLGX) report said negative equity continues to weigh on the U.S. housing market with 10.9 million residential properties, or 22.7 percent, upside down with borrowers in the first quarter.

The latest figure is a slight improvement from the fourth quarter last year, when 11.1 million, or 23.1 percent, of borrowers reported underwater mortgages.

Nevada posted the highest negative equity percentage with 63 percent of all mortgaged property currently upside down, closely trailed by Arizona with a 50 percent rate and Florida at 46 percent.

Many borrowers in a negative equity scenario are still able to make mortgage payments, but have experienced an income shock; such as a job loss, divorce or death, said CoreLogic Chief Economist Mark Fleming.

Although market indicators indicate slow, but positive economic growth — negative equity will continue to stunt the housing market recovery by holding back sale and refinance activity, he said.

Next Article: Phoenix drops thousands of tourism jobs

via bizjournals.com

March home prices suffer double-dip setback - Yahoo! News

2011-05-31T07:58:00.001-07:00

NEW YORK (Reuters) – U.S. single-family home prices dropped in March, dipping below their 2009 low, as the housing market remained bogged down by inventory and weak demand, a closely watched survey said on Tuesday.

The S&P/Case Shiller composite index of 20 metropolitan areas declined 0.2 percent in March from February on a seasonally adjusted basis, in line with economists' expectations.

The price index was below the low seen in April 2009 during the financial crisis. The glut of houses for sale, foreclosures, tight credit and weak demand have kept the housing market on the ropes even as other areas of the economy start to recover.

The 20-city composite index was at 138.16, falling below the 2009 low of 139.26.

"This month's report is marked by the confirmation of a double-dip in home prices across much of the nation," David Blitzer, chairman of the index committee at S&P Indices, said in a statement. "Home prices continue on their downward spiral with no relief in sight."

Eight cities fell 1 percent or more in March, while Washington was the only city where prices increased on both a monthly and yearly basis. Prices in the 20 cities fell 3.6 percent year over year, topping expectations for a decline of 3.3 percent.

"The declines sustained in the last 12 months have almost erased the gains of the previous 12 months. The housing market is treading backward, but not drowning," said Cary Leahey, economist and managing director at Decision Economics in New York.

In the first quarter, the national index fell 1.9 percent on a seasonally adjusted basis, compared to a decline of 1.8 percent in the previous quarter. On a non-adjusted basis, they fell by 4.2 percent in the quarter. Nationally, home prices are back to their mid-2002 levels, the report said.

Financial markets saw little reaction to the data, with U.S. stock index futures pointing to a higher open on optimism that new aid for Greece from the European Union was on the horizon.

(Reporting by Leah Schnurr, additional reporting by Ellen Freilich, editing by W Simon )

via news.yahoo.com

More data that shows the real estate market is more than just soft. This quote by David Blitzer is disheartening: "Home prices continue on their downward spiral with no relief in sight." We will keep an eye on this to see how things trend over the next couple of months which are traditionally good months for selling a home.

Pending Home Sales: Pending Home Sales Dive 11.6% in April - CNBC

2011-05-27T08:38:00.001-07:00

Pending sales of existing U.S. homes dropped far more than expected in April to touch a seven-month low, a trade group said on Friday, dealing a blow to hopes of a recovery in the housing market.
The National Association of Realtors Pending Home Sales Index dropped 11.6 percent to 81.9 in April, the lowest since September. Pending home sales lead existing home sales by a month or two.
Economists, who had expected pending home sales to fall 1.0 percent last month, said bad weather in some parts of the country might have affected home shopping.
"There may some temporary factors like bad weather in the South," said Gus Faucher, director of macroeconomics at Moody's Analytics in West Chester, Pennsylvania.
"Higher gasoline may be making potential home buyers a bit cautious. It is signaling further weakness in housing, but we do expect housing to turn around later this year. It just hasn't happened yet."
Pending home sales in the South, which was ravaged by tornadoes, dropped 17.2 percent. Sales were also down in the Midwest and the West.
The weak housing market is one the headwinds facing the economy as it make a slow recovery from the worst recession since the 1930s. The economy grew at a 1.8 percent annual rate in the first quarter after expanding at a 3.1 pace in the last three months of 2010.

via cnbc.com

The market continues to stagnate. Until there is some certainty about where the economy is going the housing market will continue to trudge along the bottom. There has been very little positive news to give buyers a reason to buy a home. I expect we will be like this for at least another 2 years.

New home sales at 4-month high, supply drops - Yahoo! News

2011-05-24T09:28:00.001-07:00

WASHINGTON (Reuters) – New single-family home sales rose for a second straight month in April and supply was the lowest in a year, but an overhang of previously owned homes on the market will stifle any housing market recovery.

The Commerce Department said sales increased 7.3 percent to a seasonally adjusted 323,000 unit annual rate, the highest level since December, while prices also rose. Economists had expected a 300,000-unit pace.

All four regions recorded gains in sales, with the West reporting a 15.1 percent rise. However, compared to April last year sales were down 23.1 percent.

"Although the headline figure has moved sharply on a month-to-month basis, reflecting in part the impact of harsh weather in earlier months, the bottom line is that the new home market continues to bounce along the bottom," said Omair Sharif, an economist at RBS in Stamford, Connecticut.

An oversupply of used houses and a relentless wave of foreclosed properties are curbing the market for new homes, even as builders are keeping lean inventories.

There were a record low 175,000 new homes available for sale last month, down 2.8 percent from the prior month.

Data last week showed a steep drop in new home construction in April and a dip in sales of previously owned homes.

"There's still a tremendous overhang in the housing market, and while new home sales are starting to percolate, that doesn't change the fact that we still have such huge inventory," said Michael Yoshikami, chief investment strategist at Ycmnet Advisors in Walnut Creek, California.

Stocks on Wall Street were little changed, while prices for U.S. government bonds fell ahead of new debt sales later in the week. The dollar fell against a basket of currencies.

SLUGGISH GROWTH

While the report cast a positive light on the housing market, it did little to change perceptions the economy remained mired in a soft patch.

That view was reinforced by a Richmond Federal Reserve survey showing manufacturing activity in the central Atlantic region stalled in May, after expanding during the previous seven months.

The Richmond Fed's manufacturing index came in at -6, a sharp contraction from the reading of +10 in April, dragged down by declining shipments and new orders.

It added to a raft of other data ranging from retail sales to industrial production that have painted a picture of an economy struggling to regain momentum as the second quarter started, with employment only the bright spot.

The government is expected to report on Thursday that the economy grew at a still tepid 2.1 percent annual rate in the first quarter, according to a Reuters survey, rather than the 1.8 percent pace it estimated last month.

The upward revision will most likely reflect a slightly faster pace of inventory accumulation than initially thought.

The Commerce Department report also showed the median sales price for a new home rose 1.6 percent last month to $217,900. Compared with April last year, the median price increased 4.6 percent.

At April's sales pace, the supply of new homes on the market dropped to 6.5 months' worth, the lowest since April last year, from 7.2 months' worth in March.
(Reporting by Lucia Mutikani; Editing by Neil Stempleman)

via news.yahoo.com

New Home sales appear to be in decent change, but builders are keeping their inventories low because demand is low due to a huge supply of resale homes. Those resale homes will be around for a lot longer.

Notice of Trustee Sale filings were down 27.9 percent in April 2011

2011-05-19T07:58:00.001-07:00

Notice of Trustee Sale filings were down 27.9 percent in April 2011 from the prior month, falling to the lowest point we've seen since we began tracking Arizona in August 2009, and down 415 percent from the same time last year. There was a similar dip in foreclosure sales, with a 22.2 percent drop in sales Back to Bank and a 15.4 percent decline in Sales to 3rd Parties month-over-month. Cancellations rose 18.8 percent month-over-month, which together with the drop in filings led to 10.6 percent fewer properties Scheduled for Sale.

Most expect housing recovery is years away | Phoenix Business Journal

2011-05-19T07:45:00.001-07:00

Only about 5 percent of the population believes the residential real estate industry has recovered — the same percent as last year, a new report shows.

Homebuyers, sellers and renter site Trulia .com and online marketplace RealtyTrac on Wednesday released the results of an ongoing survey tracking Americans' attitudes regarding the housing industry. The resulting report found that about 54 percent of respondents don't expect real recovery until 2014 or later.

An even smaller number, about 3 percent, forecast recovery happening before the end of this year. Another 156 percent see the change happening in 2012. Finally, close to a quarter said things will improve by 2013. One Trulia expert said he expects the market to be volatile through at least the end of 2011.

“Most Americans, as our latest survey revealed, overestimated how quickly the housing market would bounce back, but when it does, it will likely be a long and gradual process,” Trulia co-founder and CEO Pete Flint said. “On the flip side, mortgage rates won’t stay low forever and even if home prices continue to fall for a bit, now is still a good time to enter the housing market."

He expects about 18 months before Americans see real stability in the market.

A separate RealtyTrac report found Arizona is the No. 2 state in the country for home foreclosures, but that filings had actually dropped from the previous month.

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I am with those that think the recovery will not show in Arizona until late 2012 or 2013 at the earliest.

Home building, manufacturing slump in April - Yahoo! News

2011-05-17T09:14:00.001-07:00

WASHINGTON (Reuters) – Housing starts and building permits fell in April and factory output slumped as an automobile parts shortage crimped production, showing the economy got off to a weak start in the second quarter.

Corporate results from Home Depot Inc added further evidence of a decline in housing after the No. 1 home improvement chain noted poor weather hurt the spring selling season and sapped its sales.

Groundbreaking for new housing dropped 10.6 percent to an annual rate of 523,000 units, the Commerce Department said on Tuesday, as a glut of homes on the market discouraged new projects. March's starts were revised up to a 585,000-unit pace from the previously reported rate of 549,000 units.

The report pointed to prolonged weakness for the sector. Economists had forecast housing starts rising to a 568,000-unit rate. Compared to April last year, residential construction was down 23.9 percent, the largest decline since October 2009.

Starts in the South slumped to a two-year low.

"We're still struggling to find the bottom here for the housing market. It does not bode well for construction in the near term, and there's a good deal of overhang in terms of inventory," said Michael Woolfolk a senior currency strategist at BNY Mellon in New York.

A separate report showed the Japanese earthquake had hit U.S. manufacturing output, which fell 0.4 percent in April after 9 consecutive monthly increases, the Federal Reserve said. Overall industrial production was flat, buoyed by gains in mining and utilities.

Excluding cars and parts, manufacturing output rose 0.2 percent.

Capacity utilization, a measure of how close to flat out factories are running, fell unexpectedly in April, suggesting scant inflationary pressures in the world's largest economy.

Wal-Mart Stores Inc's, the world's largest retailer, said its U.S. business continues to struggle even as international sales held strong.

U.S. stocks fell on concerns about the economic recovery, while Treasury debt prices rose and the dollar firmed against a basket of currencies.

TOO MANY HOUSES ON THE MARKET

Residential construction is being crowded out by an oversupply of used homes on the market, in particular, foreclosed properties, which sell well below their value.

In March, the spread between the prices of new and previously owned houses was about $54,200.

Home builders' sentiment was flat in May, the National Association of Home Builders said on Monday.

Though builders expected a modest improvement in sales during spring, they anticipated market conditions to weaken in the next six months.

Residential construction accounts for about 2.2 percent of gross domestic product. Investment in home building contracted in the first quarter after a modest increase in the last three months of 2010.

Groundbreaking last month was depressed by a 24.1 percent tumble in the volatile multi-family homes sector, where starts for buildings with five or more units dropped 28.3 percent. Single-family home construction fell 5.1 percent.
New building permits dropped 4.0 percent to a 551,000-unit pace last month. March's permits were revised down to a 574,000-unit pace and economists had expected overall building permits in April to remain unchanged at the previously reported 585,000-unit pace.
Permits were held down last month by an 8.8 percent drop in the multi-family segment. Permits to build single-family homes slipped 1.8 percent.
New home completions rose 4.1 percent to 554,000 units in April.
(Additional reporting by Mark Felsenthal; Editing by Andrea Ricci)

via news.yahoo.com

Zillow: Phoenix home prices decline, 68 percent underwater | Phoenix Business Journal

2011-05-09T15:15:00.001-07:00

Home values in Phoenix are continuing to decline, according to a first quarter report released by Zillow.com.

Phoenix also has the highest percentage of homeowners with negative equity on their mortgages at 68.4 percent, the report noted.

Home values in the Phoenix metro area dropped another 2.3 percent between the last quarter of 2010 and the first quarter of 2011. The year-over-year drop was 11.2 percent. The home value drop from the market peak in Phoenix is 55.3 percent.

The report surveyed 132 markets.

Other markets with a large percentage of mortgages underwater include Atlanta (55.7 percent), Riverside, Calif. (50.7 percent), Tampa, Fla. (59.8 percent) and Sacramento, Calif. (51.2 percent).

Other markets with a large drop in values from the peak include Miami-Ft. Lauderdale (55.4 percent), Detroit (55.5 percent) and Orlando (55.2 percent).

However, the greatest concern is the current drop in values during the last quarter.

“Home values in the United States fell faster in the first quarter of 2011 than they have in any quarter since 2008, when the housing market experienced its worst performance,” the report states. “Very few markets were exempt from home value declines in the first quarter.”

The markets recording the largest declines for the quarter include Chicago (4.8 percent), Atlanta (4.4 percent), Detroit (5.2 percent), Minneapolis-St. Paul (4.8 percent), St. Louis (4 percent) and Sacramento (4.2 percent).

Only four markets recorded increases or remained flat. They are Fort Myers, Fla. (2.4 percent increase); Champaign-Urbana, Ill. (0.8 percent increase); Honolulu, Hawaii (0.3 percent) and Sarasota, Fla. (no change).

Next Article: Arizona takes 1070 fight to Supreme Court

via bizjournals.com

This is not good news. It will be a long while before this market settles down.

Reagor: Foreclosure activity eased in April

2011-05-04T07:47:00.001-07:00

My plan had been not to lead this column with news about foreclosures this week, instead focusing on a more positive indicator or trend in metro Phoenix's real-estate market.

But the foreclosure numbers from April quickly changed my mind. Pre-foreclosures fell to 4,200 last month, their lowest level since December 2007, according to real-estate-research firm Information Market.

In Arizona, pre-foreclosures are notice-of-trustee-sale filings that signal that a lender has started the legal process of taking a home back from a borrower.

In April, foreclosures dropped to 4,500, which is 500 fewer than in March. Foreclosures are legally known as trustee sales.

And the number of active residential notices, or pending foreclosures in metro Phoenix, dropped to 30,790. A year ago, this key market indicator was 30 percent higher.

A few more months of drops in foreclosure activity like April's, and it finally could be safe to say the region's housing market is starting to recover.

- Loan-modification investigation: The Arizona attorney general is asking for a court-ordered injunction to stop two people accused of deceptive loan-modification practices.

The two men, Robert Daniel Hayes and Camerin Charles Hawthorne, offer loan services under the company names Mediation Services and Metropolis Loans, according to the attorney general.

The complaint alleges the men solicited loan-modification customers over the phone and charged them upfront fees of $2,500. A new Arizona law makes it illegal for loan-modification firms to charge fees before trying to modify a mortgage.

The complaint also alleges Mediation Services told customers it was affiliated with CitiMortgage, and they had been preapproved for loan modification.

Attorney General Tom Horne has asked a Maricopa County Superior Court to prohibit the men from continuing the practices.

A hearing for the complaint has been set for May 20.

via azcentral.com

This is a positive sign. Let's hope that the trend continues.

Home prices fall for 8th month in February: S&P/Case - Yahoo! News

2011-04-26T06:39:00.001-07:00

NEW YORK (Reuters) – U.S. single-family home prices fell for an eighth straight month in February, inching closer to an April 2009 trough, a closely watched survey said on Tuesday.

The S&P/Case Shiller composite index of 20 metropolitan areas declined 0.2 percent in February from January on a seasonally adjusted basis, slightly better than economists' median forecast for a drop of 0.3 percent.

The 20-city composite index was at 139.27, holding just a hair above its 2009 low of 139.26. Average home prices across the United States are back to levels where they were in the summer of 2003.

Prices in the 20 cities have fallen 3.3 percent year over year, in line with expectations.

"There is very little, if any, good news about housing. Prices continue to weaken, trends in sales and construction are disappointing," David Blitzer, chairman of the Index Committee at S&P Indices, said in a statement.

"Recent data on existing-home sales, housing starts, foreclosure activity and employment confirm that we are still in a slow recovery."

The glut of houses up for sale has kept prices low and the market has struggled to regain traction since a home buyer tax credit expired last spring.

Other data in the last week has suggested some stabilization in the market with sales of new and existing homes rising in March.

Financial markets were unchanged by the Case-Shiller data on Tuesday, with U.S. stock index futures pointing to a higher open with investors focused on earnings from major companies.

(Reporting by Leah Schnurr, Editing by Chizu Nomiyama)

via news.yahoo.com

New home sales up, inventory at 43-1/2 year low - Yahoo! News

2011-04-25T08:49:00.001-07:00

WASHINGTON (Reuters) – New U.S. single-family home sales increased more than expected in March and the supply of new houses on the market hit their lowest level since August 1967, but prices fell from a year ago.

The Commerce Department said on Monday sales rose 11.1 percent to a seasonally adjusted 300,000 unit annual rate, after an upwardly revised 270,000 unit pace in February.

Economists polled by Reuters had forecast new home sales climbing to a 280,000-unit pace last month from a previously reported record low 250,000 unit rate.

Compared to March last year sales were down 21.9 percent.

The market for new homes is being squeezed by competition from previously owned homes and a deluge of foreclosed properties, even though inventories of new houses are at a 43-1/2 year low.

A report last week showed there were 3.55 million previously owned homes on the market in March, well above the economy's natural rate of between 2 million and 2.5 million.

When foreclosed homes and those that are highly delinquent are taken into account, economists say supply is anywhere in the range of 8 million to 9 million.

The median sales price for a new home rose 2.9 percent last month to $213,800 from February. Compared with March last year, the median price fell 4.9 percent.

At March's sales pace, the supply of new homes on the market slipped to 7.3 months' worth from 8.2 months' worth in February. There were 183,000 new homes available for sale last month, the lowest since August 1967.

(Reporting by Lucia Mutikani; Editing by Neil Stempleman)

via news.yahoo.com

The main reason there is low inventory in Arizona is nobody has been building. So the supply side is really not that unexpected. Good news that sales are up, though.

Existing home sales rise, prices fall - Yahoo! News

2011-04-20T09:18:00.001-07:00

WASHINGTON (Reuters) – Sales of previously owned U.S. homes rose more than expected in March, a trade group said on Wednesday, suggesting the housing market's downward trend may be close to hitting a bottom.

The National Association of Realtors said sales rose 3.7 percent month over month to an annual rate of 5.10 million units after an upwardly revised 4.92 million unit pace in February.

Economists polled by Reuters had expected sales to rise 2.5 percent to a 5.0 million-unit pace from the previously reported 4.88 million unit rate. Sales have now risen in six of the past eight months.

"It's slow, steady progress, but you cannot not be disturbed by the slow pace of recovery," said Pierre Ellis, an economist at Decision Economics in New York. "Demand is rising even with higher mortgage rates so that's encouraging."

The housing market is struggling to find its footing as a wave of foreclosed properties keeps supply elevated and prices depressed.

Last month, foreclosures and short sales, which typically occur at about 20 percent below market value, accounted for 40 percent of transactions. That was the highest since April 2009 and was up from 39 percent in February.

The median home price fell 5.9 percent in March from a year earlier to $159,600. Compared with March last year, sales were down 6.3 percent.

"A sustained turnaround in the housing market is still far off based on earlier-released depressed readings for housing starts, building permits and builders' confidence indices," said Krishen Rangasamy an economist at CIBC World Markets in Toronto.

MORTGAGE APPLICATIONS UP

A separate report on Wednesday showed demand for home loans rose last week, as interest rates eased and purchase activity picked up. The Mortgage Bankers Association said its purchase index rose 10 percent to 210.8, the highest since early December.

Last month, all-cash purchases made up a record 35 percent of sales in March and the NAR said the lower and upper ends of the market were showing strong activity, with the middle part -- which accounts for the existing housing market -- remaining sluggish.

Sales last month rose across the board, with multifamily dwellings rising 1.6 percent and single-family home units advancing 4 percent.

At March's sales pace, the supply of existing homes on the market slipped to 8.4 months' worth from 8.5 months in February. However, the number of previously owned homes on the market rose 1.5 percent to 3.55 million.

A supply of between six and seven months is generally considered ideal, with higher readings pointing to lower house prices.

(Reporting by Lucia Mutikani; Editing by Neil Stempleman)

via news.yahoo.com

Housing starts, permits rebound in March - Yahoo! News

2011-04-19T09:05:00.001-07:00

WASHINGTON (Reuters) – Housing starts and permits for future home construction rose more than expected in March, snapping back from the prior month's winter weather depressed levels, government data showed on Tuesday.

The Commerce Department said housing starts rose 7.2 percent to a seasonally adjusted annual rate of 549,000 units. February's starts were revised up to a 512,000-unit pace from the previously reported rate of 479,000 units.

Economists polled by Reuters had forecast housing starts rising to a 520,000-unit rate. Compared to March last year, residential construction was down 13.4 percent.

Still, the bounce back in residential construction does not signal recovery as an over- supply of homes continues to discourage builders from embarking on new projects.

"It's mainly a rebound from previous month's decline. We still think the housing market is very weak, and the high inventory is still depressing sales and prices," said Sireen Harajli, an economist at Credit Agricole Corporate & Investment Bank in New York.

"We hope to see some signs of improvement toward the end of the year, but we won't see substantial improvement until 2012."

Stock index futures were steady at higher levels, while government debt prices were steady at lower levels. The dollar held at lower levels versus the euro.

Home builders' sentiment slipped a notch in April, the National Association of Home Builders said on Monday, with builders viewing sales conditions now and in the next six months as unfavorable.

Residential construction was likely a drag on economic growth in the first quarter after making a modest contribution in the last three months of 2010. Home building accounts for about 2.4 percent of gross domestic product.

Groundbreaking last month was lifted by a 5.8 percent rise in volatile multifamily homes. Single-family home construction increased 7.7 percent.

New building permits advanced 11.2 percent to a 594,000-unit pace last month, rebounding from February's record low 534,000 units. Economist had expected overall building permits to rise to a 540,000-unit pace in March.

Permits were propped up last month by a 25.2 percent jump in the multifamily segment. Permits to construct buildings with five or more units rose to their highest level since January 2009 -- likely reflecting growing demand for rental properties.

Permits to build single-family homes rose 5.7 percent. However, new home completions dropped 14.2 percent to a record low 509,000 units in March

(Reporting by Lucia Mutikani, editing by Neil Stempleman)

via news.yahoo.com

New home sales plunge to record low in February - Yahoo! News

2011-03-23T08:47:00.001-07:00

WASHINGTON (Reuters) – New single-family home sales unexpectedly fell in February to hit a record low and prices were the lowest since December 2003, showing the housing market slide was deepening.

The Commerce Department said on Wednesday sales dropped 16.9 percent to a seasonally adjusted 250,000 unit annual rate, the lowest since records began in 1963, after an upwardly revised 301,000-unit pace in January.

Sales plunged to all-time lows in three of the four regions last month. Economists polled by Reuters had forecast new home sales edging up to a 290,000-unit pace last month from a previously reported 284,000 unit rate.

"It's been a disappointing February for home sales and there are no signs of a turnaround," said Kurt Karl, chief U.S. economist at Swiss Re in New York.

"We're going to have a continuing slowdown in the next few months, but people will start to feel better in the second half of the year and construction and sales should do better later this year and into next year."

U.S. stock indexes fell on the data, while government debt prices rose marginally. The dollar was little changed.

Compared to February last year sales were down 28 percent.

An oversupply of homes exacerbated by an increasing flood of properties falling into foreclosure is frustrating recovery in the housing market. Data on Monday showed a steep drop in sales of previously owned homes in February, with prices tumbling to a near nine-year low.

HOUSE PRICES PLUNGE

The median sales price for a new home plunged 13.9 percent last month to $202,100, the lowest since December 2003. Compared with February last year, the median price fell 8.9 percent. Persistent price declines could dampen hopes of a pick-up in sales during spring.

In the face of stiff competition from foreclosed properties, which typically sell well below market value, builders are holding back on new construction.

At February's sales pace, the supply of new homes on the market rose to 8.9 months' worth, the highest since August, from 7.4 months' worth in January.

There were 186,000 new homes available for sale last month, matching the prior month's inventory. That was still the smallest supply of home since 1967.

Despite lean inventories, new home sales will likely continue to bounce along the bottom for a while until the glut of previously owned homes is whittled down. New home sales account for less than 10 percent of overall sales.

According to the National Association of Realtors, new home prices have been running 45 percent higher than existing home prices, a premium that is historically about 15 percent, indicating previously owned homes are selling well below the cost of construction.

Separately, the Mortgage Bankers Association said applications for home loans rebounded 2.7 percent last week.

(Reporting by Lucia Mutikani; Additional reporting by Ellen Freilich in New York; Editing by Andrea Ricci)

via news.yahoo.com

The housing market continues to be a drag on the recovery.

Home sales dive, prices near 9-year low - Yahoo! News

2011-03-21T10:12:00.001-07:00

WASHINGTON (Reuters) – Sales of previously owned U.S. homes plunged in February and prices hit their lowest level in nearly nine years, implying a housing market recovery was still a long way off.

The National Association of Realtors said on Monday sales fell 9.6 percent month over month to an annual rate of 4.88 million units, snapping three straight months of gains. The percentage decline was the largest since July.

Economists polled by Reuters had expected February sales to fall 4.0 percent to a 5.15 million-unit pace from the previously reported 5.36 million unit rate in January. January's pace was revised up slightly to 5.40 million.

"This is a frustrating number. The U.S. residential real estate market doesn't seem to want to turn around despite better affordability," said David Carter, chief investment officer at Lenox Advisors in New York.

Financial markets largely ignored the data. U.S. stocks were up sharply in early trade, partly on news of a bid by AT&T for Deutsche Telekom AG's T-Mobile USA and growing hopes Japan would get its nuclear crisis under control.

U.S. debt prices extended losses as the U.S. Treasury said it would begin selling off $142 billion in mortgage-backed securities it had acquired to help tame the financial crisis, while the dollar rose against the yen on intervention worries.

The Realtors' group said the median home price dropped 5.2 percent in February from a year earlier to $156,100, the lowest since April 2002, a sign of the relentless downward pressure on prices from a market flooded with foreclosure sales.

"If the price declines persist, even with the job market recovery, that could hamper recovery in the housing market," said NAR chief economist Lawrence Yun.

A glut of homes on the market and the flood of foreclosure properties are holding back a recovery in the housing sector, whose collapse helped to tip the U.S. economy into its worst recession since the 1930s.

Foreclosures and short sales, which typically occur below market value, accounted for 39 percent of transactions in February, up from 37 percent the prior month, the trade group said. All-cash purchases made up a record 33 percent of transactions in February.

Sales fell across the board, with multifamily dwellings declining 10 percent and single-family home units dropping 9.6 percent. Compared with February last year, overall sales were down 2.8 percent.

At February's sales pace, the supply of existing homes on the market rose to 8.6 months' worth from 7.5 in January. A supply of between six and seven months is generally considered ideal, with higher readings pointing to lower house prices.

(Additional reporting by Ryan Vlastelica in New York; Editing by Andrea Ricci)

via news.yahoo.com

Housing starts see biggest drop since 1984 - Yahoo! Finance

2011-03-16T07:59:00.001-07:00

Housing starts see biggest drop since 1984

WASHINGTON (Reuters) - Housing starts posted their biggest decline in 27 years in February while building permits dropped to their lowest level on record, suggesting the beleaguered real estate sector has yet to rebound from its deepest slump in modern history.

Groundbreaking on new construction dropped 22.5 percent last month to an annual rate of 479,000 units, according to Commerce Department data released on Wednesday. This was just above a record low set in April 2009 and way below the estimates of economists, who had been looking for a smaller drop to 570,000.

January's figure was revised up to 618,000 units from 596,000. But that did not change the tenor of the report, which confirmed that the sector is failing to recover despite interest rates near record lows.

Building permits, a hint of future construction demand, fell to a record low of 517,000 units from a revised 563,000, and were down by about 20 percent from levels seen in February 2010.

Housing was at the epicenter of the financial crisis of 2007-2009.

One key impediment to the sector's recovery is a vast backlog of unsold inventory, while a shaky job market has also made consumers reluctant to embark on any major new financial commitments. Making matters worse, a glut of foreclosures, stalled in recent months by revelations of improper loan documentation, is depressing the market.

via finance.yahoo.com

Underwater mortgages rise as home prices fall - Yahoo! News

2011-03-08T08:16:00.001-08:00

WASHINGTON – The number of Americans who owe more on their mortgages than their homes are worth rose at the end of last year, preventing many people from selling their homes in an already weak housing market.

CoreLogic says about 11.1 million households, or 23.1 percent of all mortgaged homes, were underwater in the October-December quarter. That's up from 22.5 percent, or 10.8 million households, in the July-September quarter.

The number of underwater mortgages had fallen in the previous three quarters, but that was mostly because more homes had fallen into foreclosure.

Underwater mortgages typically rise when home prices fall. Home prices in December hit their lowest point since the housing bust in 11 of 20 major U.S. metro areas. In a healthy housing market, about 5 percent of homeowners are underwater.

via news.yahoo.com

Home prices hit post-bust lows in most big cities - Yahoo! Finance

2011-02-22T11:54:00.001-08:00

WASHINGTON (AP) -- Home prices in a majority of major U.S. cities tracked by a private trade group have fallen to their lowest levels since the housing bubble burst, and analysts expect further declines this year.

The Standard & Poor's/Case-Shiller 20-city home price index fell 1 percent in December from November. Prices fell in all but one of the metropolitan markets tracked.

The only city to see a gain was Washington, where hiring by the federal government has helped boost the region's job market.

Eleven of the markets hit their lowest point since the housing bust, in 2006 and 2007: Atlanta, Charlotte, N.C., Chicago, Detroit, Las Vegas, Miami, New York, Phoenix, Portland, Ore., Seattle and Tampa, Fla.

The housing sector is struggling even while the rest of the economy is showing signs of a slow but steady recovery. The latest evidence of this divide came Tuesday when the Conference Board said its Consumer Confidence Index rose in February to its highest point in three years. The index surveys how people feel about hiring and income, and how they see that changing over the next six months.

By contrast, the outlook for housing in 2011 is not promising. Construction of new homes has fallen to a rate of about 600,000 homes built per year. In a healthy economy, builders expect to construct about 1 million homes each year. Homeowner vacancy rates are near record highs and the creation of new households in the United States is at its lowest point in four decades.

"Despite improvements in the overall economy, housing continues to drift lower and weaker," said David M. Blitzer, chairman of the index committee at Standard & Poor's.

The damage from the real estate bubble has spread well beyond the Sun Belt, where new homes cropped up at a frantic pace during the mid-2000s. In many places, prices are expected to keep falling for at least the next six months and several analysts said they expect prices to fall at least another 5 percent.

Some of the worst declines are in cities hit hardest by foreclosures and high unemployment, including Detroit, Phoenix and Tampa. A home that sold for $250,000 in the Motor City in 2000 now sells for roughly $163,150, according to the housing report. Homes in Las Vegas and Cleveland now sell, on average, for less than they of what they did a decade ago. Many people are holding off buying or selling homes because they fear the market hasn't hit bottom yet.

A large number of homes that aren't selling are contributing to a second wave of price declines since the boom years. Many of them have been vacant for months.

In December, prices fell for the sixth straight month and for the eighth time in the past 11 months. Foreclosures are also expected to increase as the year goes forward.

"There's just way too many homes out there relative to demand and we're not going to see that change anytime soon," said Joshua Shapiro, chief U.S. economist for MFR Inc.

The housing recovery is uneven across the United States. Coastal cities in California and the Northeast are faring much better than the Midwest and Southeast. That's mainly because they benefit from expensive and somewhat recession-proof housing markets buoyed by low unemployment and limited new construction.

The Case-Shiller report measures home price increases and decreases relative to prices in January 2000 and gives an updated three-month average for the metropolitan areas it looks at.

via finance.yahoo.com

BofA Halts All Foreclosures - WSJ.com

2010-10-08T08:40:00.001-07:00

Bank of America Corp. is placing a moratorium on all foreclosure proceedings and sales across the U.S. amid political pressure on U.S. banks to examine foreclosure-documentation problems.

The nation's largest bank by assets is the first financial institution to stop all foreclosure actions amid revelations that the banking industry had used "robo-signers," people who sign hundreds of documents a day without reviewing their contents, when foreclosing on homes. Bank of America, J.P. Morgan Chase & Co. and Ally Financial Inc. last week postponed foreclosures in 23 states where a court's approval is required to foreclosure on a home.

via online.wsj.com

This is HUGE news.

Renters in Foreclosed Properties Do Not Lose Their Leases

2010-08-04T07:46:00.001-07:00

Before May 20, 2009, most renters lost their leases upon foreclosure. The rule in most states was that if the mortgage was recorded before the lease was signed, a foreclosure wiped out the lease (this rule is known as "first in time, first in right"). Because most leases last no longer than a year, it was all too common for the mortgage to predate the lease and destroy it upon foreclosure.

These rules changed dramatically on May 20, 2009, when President Obama signed the "Protecting Tenants at Foreclosure Act of 2009." This legislation provided that leases would survive a foreclosure -- meaning the tenant could stay at least until the end of the lease, and that month-to-month tenants would be entitled to 90 days' notice before having to move out (this notice period is longer than any state's non-foreclosure notice period, a real boon to tenants).

An exception was carved out for the buyer who intends to live on the property -- this buyer may terminate a lease with 90 days' notice. Importantly, the law provides that any state legislation that is more generous to tenants will not be preempted by the federal law. These protections apply to Section 8 tenants, too.

Importantly, tenants who live in cities with rent control "just cause" eviction protection are also protected from terminations at the hands of an acquiring bank or new owner. These tenants can rely on their ordinance's list of allowable, or "just causes," for termination. Because a change of ownership, without more, does not justify a termination, the fact that the change occurred through foreclosure will not justify a termination.

via nolo.com

BofA to start reducing mortgage principal - Yahoo! News

2010-03-24T12:14:00.001-07:00

CHARLOTTE, N.C. – Bank of America Corp. is giving some of its most troubled mortgage borrowers relief from the threat of foreclosure.

The bank, the largest mortgage servicer in the country, said Wednesday it will forgive up to 30 percent of some customers' total mortgage balance. The homeowners must be at least 60 days delinquent on their loans and owe more than 120 percent of their homes' value.

The plan is part of an agreement the Charlotte, N.C.-based bank reached 18 months ago with state attorneys general to settle charges over high-risk loans made by Countrywide Financial Corp. The loans were made before Bank of America acquired the mortgage lender in mid-2008. Bank of America has since stopped making those loans.

Although the motivation for Bank of America's announcement was to resolve legal problems, it has the potential of setting a precedent for other banks to also start forgiving principal on loans that are in danger of failing. Bank of America is the nation's largest bank, and it's among the first to take a systematic approach to reducing mortgage principal when home values drop well below the amount owed.

Millions of homes have gone into foreclosure since the housing market collapsed in late 2007. The loans affected by Bank of America's announcement include certain subprime and option adjustable rate mortgages. Option ARMs allow borrowers to start with minimal monthly payments that actually increase the loan's balance.

The borrowers who can take advantage of the Bank of America program must also qualify for the Obama administration's $75 billion mortgage loan modification program.

Bank of America estimates that about 45,000 customers will qualify for its plan.

The offer will cut total reduced principal by about $3 billion. That could lower the bank's earnings, which have already been hurt by consumers' continuing defaults on mortgage and credit card loans. Bank of America was among the hardest hit by the credit crisis and recession.

Even so, "the move helps create the best prospect of avoiding a further downward home price spiral, which would result in even deeper losses" for the bank, said Howard Glaser, a mortgage industry consultant, in an e-mail.

Investors appeared pleased with the news, sending Bank of America shares up 36 cents, or 2.1 percent, to $17.49 in afternoon trading.

According to new plan, which begins in May, Bank of America will first offer to set aside a portion of the principal balance, interest free. That principal can be forgiven over five years, if homeowners don't miss any payments. The maximum decrease in principal will be 30 percent.

The forgiveness allows a homeowner to bring a mortgage balance back down to 100 percent of the home's value, the bank said.

Glaser said the program could lead the Obama administration to launch a similar effort for the entire industry. That, he wrote, would be a "major shift in loan modification efforts."

Lenders including Bank of America have been criticized for not helping enough borrowers to complete the Obama administration's $75 billion loan modification program, which is widely viewed as a disappointment. Only 170,000 homeowners have completed the program so far.

As of last month, Bank of America had completed modifications for about 22,000 homeowners, or about 8 percent of those signed up. That compares with about 12 percent for Wells Fargo & Co. and 11 percent for both JPMorgan Chase & Co. and Citigroup Inc.

The Treasury Department estimates that 1.5 million to 2 million homeowners will complete the program by the end of 2012, about half of the original goal. A report issued late Tuesday by Neil Barofsky, the special inspector general for the Troubled Asset Relief Program, says numerous changes to government guidelines "caused confusion and delay" and said the government did not do enough to advertise the program.

___

AP Real Estate Writer Alan Zibel in Washington, D.C., contributed to this report.

via news.yahoo.com

Wow, never thought I would see this. How many people will stop making payments now?

New home sales hit record low in January - Yahoo! Finance

2010-02-24T07:21:00.001-08:00

New home sales plummet 11.2 percent in January to annual rate of 309,000, lowest on record. The extra distressed property inventory will continue to be an issue for new homes sales for well into the future.

The AP story is here.

Current Stats for 85018 - 02/12/2010

2010-02-12T07:18:00.001-08:00

Current Stats for 85018

All Property Types

ALL Distressed Distressed PPSF Not Distressed Not Distressed PPSF % Distressed
Active 416 117 146.26 299 308.72 28.13

In Escrow 108 78 147.25 30 224.16 72.22

Closed - MTD 13 3 112.99 10 206.14 23.08

Closed - 01/2010 36 22 141.54 14 167.80 61.11

Months of inventory for Not Distressed properties = 21.4
Months of inventory for Distressed properties = 5.3

via homezon.dyndns.biz

LBPOST.com: Foreclosure Up-Tick May Signal Impending Flood

2010-02-12T06:53:00.001-08:00

January foreclosure numbers are exhibiting a pattern very similar to a year ago: a double-digit percentage jump in December foreclosure activity followed by a 10% drop in January,” James J. Saccacio, CEO of RealtyTrac, said in a statement. “If history repeats itself we will see a surge in the numbers over the next few months as lenders foreclose on delinquent loans where neither the existing loan modification programs or the new short sale and deed-in-lieu of foreclosure alternatives works.

via lbpost.com

Interesting article. I am not sure why the coming influx of foreclosures is not getting more attention.

New program to make short sales easier

2010-02-10T06:04:00.001-08:00

The federal government is launching a program April 5th to increase and streamline short sales. It's called Home Affordable Foreclosure Alternatives (HAFA). The program aims to standardize short sale regulations and paperwork. All servicers participating in HAMP, the federal Home Affordable Modification Program, are contractually obligated to consider those ineligible for modifications for a foreclosure alternative. Read the whole article at azcentral.com

via azcentral.com

As an agent, I hope that this makes things better, however, I do not hold out too much hope because of the huge volume of short sales still to come.

Are you ready to pay more taxes in 2011??

2010-02-02T06:28:00.001-08:00

In the 2010 budget tabled by President Barack Obama on Monday, the White House wants to let billions of dollars in tax breaks expire by the end of the year -- effectively a tax hike by stealth.

While the administration is focusing its proposal on eliminating tax breaks for individuals who earn $250,000 a year or more, middle-class families will face a slew of these backdoor increases.

....If President Bush's tax cuts are allowed to expire at the end of this year, the top-tier personal income tax rate will rise to 39.6 percent from 35 percent. Lower-income families will pay more too: the 25 percent tax bracket will revert back to 28 percent; the 28 percent bracket will increase to 31 percent; and the 33 percent bracket will increase to 36 percent.

This is not what is needed to keep the economy going. Right when things may be turning around the bulk of tax payers will be hit with less income thanks to taxes.

Investors will pay more on their earnings next year, the tax on dividends will jump to 39.6 percent from 15 percent and the capital-gains tax increases to 20 percent from 15 percent.

Also, the death tax may be back as early as this year, and there is talk of making it retroactive!

Does this make sense to anyone?

To read the who article go to Yahoo! News

Foreclosure Trends for 85018

2010-01-29T06:26:00.001-08:00

Las Vegas, California Cities Top Foreclosure List in 2009 - BusinessWeek

2010-01-28T06:08:00.001-08:00

Las Vegas homeowners had the highest U.S. foreclosure rate last year, and California and Florida cities accounted for 17 of the nation’s 20 worst markets as unemployment extended the housing recession.

via businessweek.com

The article goes on to say that things are looking to get worse before they get better. A significant increase in foreclosures is expected and if the economy continue to sputter home prices that gained in the past six months will falter again.

New home sales fall 7.6% in December

2010-01-27T08:08:00.001-08:00

Sales of new homes unexpectedly fell 7.6 percent last month, capping the industry's weakest year on record.

The results were the weakest since March and indicated demand remains sluggish despite newly expanded tax incentives to spur sales.

Only 374,000 homes were sold last year, down 23 percent from a year earlier and the weakest year on records dating back to 1963.

The median sales price of $221,300 was down nearly 4 percent from $229,600 a year earlier, but up about 5 percent from November's median of $210,300.

Az Central article is here

As long as there are distressed properties on the market in any sizable quantity the new home sales figures will be horrible.

December home sales down nearly 17 percent - Yahoo! News

2010-01-25T07:45:00.001-08:00

Sales of previously occupied homes took the largest monthly drop in more than 40 years last month, sinking more dramatically than expected ......

December's sales fell 16.7 percent to a seasonally adjusted annual rate of 5.45 million, from an unchanged pace of 6.54 million in November, the National Association of Realtors said Monday. Sales had been expected to fall by about 10 percent, according to economists surveyed by Thomson Reuters.....

The inventory of unsold homes on the market fell about 7 percent to 3.3 million. That's a 7.2 month supply at the current sales pace, close to a healthy level of about 6 months.

Unfortunately, they do not mention the inventory that is currently being held by as Bank Owned will at some point hit the market and potentially cause the months supply to jump. We know that B of A is already getting ready to release bank owned properties into the Las Vegas market... It is only a matter of time until this happens throughout the country.

Foreclosure - New Winter Olympic Game??!!

2010-01-22T05:30:00.001-08:00

The Whistler ski resort in Vancouver, where the XXI Winter Olympics will be held next month, slipped into foreclosure after parent Intrawest missed a $524 million debt payment last month and it could be auctioned off by creditors — in the middle of the Games!
If you have a few extra bucks socked away you may be able to pick up a ski resort on the cheap.
Crazy times!

Read the article here

Current Stats for Phoenix - 01/21/2010

2010-01-21T07:41:00.001-08:00

Current Stats for Phoenix

All Property Types

	ALL	Distressed	Not Distressed	% Distressed
Active	35097	14501	20596	41.32
Pending	10782	7316	3466	67.85
Closed - 12/2009	7553	4955	2598	65.60

Months of inventory for Not Distressed properties = 7.9
Months of inventory for Distressed properties = 2.9

Single Family Property Types

	ALL	Distressed	Not Distressed	% Distressed
Active	27536	11974	15562	43.48
Pending	9327	6408	2919	68.70
Closed - 12/2009	6485	4276	2209	65.94

Months of inventory for Not Distressed properties = 7
Months of inventory for Distressed properties = 2.8

Arizona #2 in US foreclosures for 2009

2010-01-21T06:58:00.001-08:00

According to RealtyTrac, Arizona is second from the top in foreclosures for 2009 with only Nevada beating us out. This is not a list where you want to be on top. The numbers for 2009 were helped out by some government programs that slowed the foreclosure process down. All indicators point to things not getting much better for 2010. As you can see by the numbers, Nevada is in serious trouble with over 10% of all homes in foreclosure.

Here are the top 5: (calculated as a percentage of all homes)

1) Nevada - 10.17%
2) Arizona - 6.12%
3) Florida - 5.93%
4) California - 4.75%
5) Utah - 2.93%

Article from the Phoenix Business Journal

Big Banks Accused of Short Sale Fraud - CNBC

2010-01-20T07:46:00.001-08:00

Big Banks Accused of Short Sale Fraud

via cnbc.com

Good article from CNBC. Apparently some second lien holders are asking to be greased on the side, outside of the closing docs (illegal), in turn for approving the short sale. Good work by Diana Olick and thanks for shining a light on this. click here to read the whole article.

FHA Lifts 90 Day Seasoning Requirment

2010-01-18T13:37:00.001-08:00

Starting February 1^st for a period of 1 year the FHA will lift the 90 seasoning requirement. This is fantastic news for investors. There are still some restrictions and requirements, but the policy change recognizes the needs of the marketplace. Here is what the FHA had to say in their press release:

““In today's market, FHA research finds that acquiring, rehabilitating and the reselling these properties to prospective homeowners often takes less than 90 days. Prohibiting the use of FHA mortgage insurance for a subsequent resale within 90 days of acquisition adversely impacts the willingness of sellers to allow contracts from potential FHA buyers because they must consider holding costs and the risk of vandalism associated with allowing a property to sit vacant over a 90-day period of time.”

The complete press release is here.

Facing Foreclosure? You Have Options

2010-01-15T06:03:00.001-08:00

Some of the options available to you are:

Home Affordable Modification Program: You must qualify First …. check if you qualify for HAMP

Short sale: A short sale is when you sell a home for less than what is owed on the mortgage…. you should list it with a real estate professional that's well versed in these types of sales.

Deed in lieu of foreclosure: Essentially handing over the keys to the lender in lieu of actually going through the foreclosure process.

Talk to your lender: The bottom line: If you're struggling to make your monthly mortgage payment or you've missed a payment, make a call to your lender.

To find out more about these options and others visit my Foreclosure Website.

Bank of America to release homes - Business - ReviewJournal.com

2010-01-14T06:05:00.001-08:00

Bank of America expects to release about 6,000 foreclosed properties into the Nevada housing market in 2010, or about 500 a month, an executive with the bank said Wednesday. It's part of the so-called "phantom inventory" of foreclosed homes being held by banks as they work out loan modifications and negotiate short sales, two of the more desirable alternatives to foreclosure. Throughout the country, estimates of homes being taken back by Bank of America range from 11,000 to 14,000 a month in the early part of this year to 29,000 to 35,000 by November and December, said John Ciresi, vice president and portfolio manager for Bank of America in Towson, Md. To read the entire article go to Las Vegas Review-Journal.

I expect this to begin happening in Arizona as well. The "phantom inventory" is just too large for banks to continue holding on to. Eventually something has to give. A large influx of properties will definitely have a drag on the prices. 500 properties a month from one lender is HUGE.

Delinquency, Foreclosure Hit One in 7.5

2010-01-13T08:10:00.001-08:00

One in every 7.5 homeowners in the U.S. is either delinquent on their loans or in foreclosure, according to Lender Processing Service. In its December 2009 Mortgage Monitor report, Florida-based LPS said total delinquencies, excluding foreclosure, rose to a record 9.97%, an increase of more than 21% from a year earlier. It also found that .... more than 5% of loans have moved to a more delinquent status, while 1.52% have improved. It did note, however, that the number of foreclosure starts has continued to decline, thanks to loss mitigation efforts such as the federal government’s Home Affordable Modification Program. Thanks to EMII for their report.

I expect this number to grow as long as the unemployment rate stays high. There are also a lot more sub-prime loans getting ready to reset their rates this year.

New Treasury Guidelines for Short Sales

2010-01-13T05:27:00.001-08:00

The US Treasury has handed down new guidelines to lenders for dealing with short sales. In addition to some cash incentives the lenders will be responsible for responding to offers within 10 days. There are 83 banks that will be required to follow these guidelines. To read more of the article go to: http://www.miamiherald.com/business/story/1421797.html

Jim Gruler, CDPE, CNE
Designated Broker
Hunter James Properties
602-618-6728

Home sales drop 2.7 percent

2009-09-24T07:27:00.001-07:00

Home sales drop 2.7 percent, Median sales price down 12.5 percent!!

This is according to the National Association of Realtors.

There is still uncertainty in the real estate market. Great time for buyers, not so good for sellers.

http://finance.yahoo.com/news/Home-sales-drop-27-apf-2064841344.html?x=0&.v=4

And Now April Existing Home Sales are UP!!!

2008-05-01T09:09:00.000-07:00

We saw that March had an increase from February sales. Now April has seen a 13% increase from March sales. There were 4783 existing home sales in April. This is really good news. Combine that news with the fact that the number of homes currently in escrow is close to 8000 means May looks to have at least as many sales as April. I believe we will hit 5000 homes sales in May. Right now Inventory is at 54716 with 49% of those properties sitting vacant. We have just under 12 months of inventory.

I believe the bottom is here for Metro Phoenix.

[digg=http://digg.com/business_finance/April_Existing_Home_Sales_Up_Phoenix]

March Existing Home Sales are WAY UP!!!

2008-04-01T09:27:00.000-07:00

It will be 15 days before you hear the “official” numbers from Arizona Association of Realtors, but you can say you heard it here first. March existing home sales are up, WAY UP!!! There were 4200 existing home sales in March which is an increase of nearly 34% over February’s sales. The bigger news is that the number of homes currently in escrow is close to 7000. This means that within the next 45 days or so most of these properties will be closing escrow. If the number of homes in escrow stays consistently at or above about 6500 the monthly sales figures should remain brisk at over 4000 per month. If all things continue along as they are now, April existing home sales will hit at least 4700. Even though inventory is still hovering at 56000, months of inventory is now at 13 months and should shrink to 12 months by the end of April.

Have we hit the bottom? Can’t say yet, but we should know soon.

Stay tuned….

Lenders altering rules for credit

2008-03-20T08:42:00.000-07:00

The article, Lenders altering rules for credit, from the Arizona Republic, reports that banks and lenders are rapidly changing their requirements for loans as home sales and prices fall and delinquencies and defaults rise. To adjust their standards, which many critics say grew too lax in the middle of the decade, lenders now are raising minimum credit scores, offering smaller loans and requiring detailed proof of income and assets.
For those who do meet the tightened criteria, a new plan announced Tuesday by the Federal Reserve to provide $200 billion to the financial-services sector should mean there is plenty of money available for borrowers and lower interest rates, said David Wyss, chief economist at Standard & Poor's. In early 2007, customers with credit scores in the low 600s would be able to receive a mortgage with no down payment and by simply stating their income. Today, a credit score below 680 is a red flag that subjects a prospective homeowner to higher rates and special fees. Read the entire article to find out more.

Older Homeowners Cautioned On Use of Reverse Mortgages

2008-03-17T13:51:00.000-07:00

The Financial Industry Regulatory Authority urged homeowners over the age of 60 to carefully weigh their options before tapping into their home equity through reverse mortgages to obtain additional income for their retirement years.

The group, formed by a merger of the NASD and some regulatory functions of New York Stock Exchange parent NYSE Group Inc., warned that a reverse mortgage -- an interest-bearing loan secured by the equity in a home -- can jeopardize their financial futures.

With a reverse mortgage, a bank makes payments to a homeowner instead of the homeowner making payments to a bank. The loan is repaid, with interest, when the borrower sells the house, moves out or dies. Reverse mortgages have high fees -- typically about 7% of the home's value -- and they make it difficult for homeowners to leave the property to their heirs.

Read the whole article at realestatejournal.com.

A Good Time to Buy a House If You Can Afford One

2008-03-11T11:05:00.000-07:00

For years rapidly rising prices kept many first-time home buyers out of the housing market. But as home values slide further downward and interest rates hover at relatively low levels, it may be time to start looking to buy that first house.

That is, if you have a secure job, can afford higher down payments than were required a few years ago and can meet lenders' much stricter income and credit requirements.

Also, don't assume the seller is even in the right ballpark with his asking price. Most real-estate agents and sellers only look at comparable sales prices, or "comps," of similar homes in similar neighborhoods. Take a lesson from property investors and appraisers instead and check out prices from other angles as well.

To read the whole article go here

Arizona banks join 'Lifeline' to aid homeowners

2008-02-13T06:51:00.001-08:00

White House effort will give homeowners at risk of foreclosure a 30-day reprieve.

If you are a homeowner and you have a loan with one of the following banks:

Bank of America, Chase, Citigroup, Countrywide Financial, Washington Mutual or Wells Fargo

AND you meet the following criteria you may be able to get a temporary reprieve from foreclosure proceedings:

□ 90 days or more overdue on payments

□ have not filed for bankruptcy protection

□ don't have a foreclosure date set within the next 30 days

□ haven't vacated the property

□ haven't used your loan to fund investment property or vacation homes

Read the article at:

http://www.azcentral.com/realestate/articles/0213biz-lifeline0213.html

Stimulus plan also sparks housing market

2008-02-01T13:30:00.001-08:00

This article from CNNMoney.com, reports that the economic stimulus plan announced by Congress last Thursday includes provisions that specifically address the mortgage crises. The package proposes lifting the dollar amount of loans that are eligible for purchase by Freddie Mac and Fannie Mae to $625,000 for 12 months, up from the current $417,000, and then raiding it to $725,000 permanently. “This will have a big, immediate impact, especially in California where sales have been down most significantly,” said Lawrence Yun, chief economist for the National Association of Realtors (NAR). Yun added, “There’s a lot of pent-up demand in the market. This will boost confidence among these potential buyers, and some of the people on the fence will start buying.”

Read the whole article here.

October Stats

2007-11-26T07:22:00.001-08:00

So, October stats came in last week and they are on par with September. The month started off a little stronger at the beginning of the month, but slowed down toward the end of the month. This is not all that unusual. There were probably quite a few people that had some issues with financing in September that go pushed to early October. October sales of existing homes came in at 3457 with an average sale price of $324,000. Since getting a jumbo loan was and is considerably more difficult these days there is also no real surprise that the average sale price has dropped a bit. We expect to see the average sale price climb as the mortgage situation gets straightened out. Looking forward to November we see things staying about the same as October and September. We expect the number of existing homes sold to be around 3400 for November.

RealtyTrac reports Q3 foreclosures up nearly 34%

2007-11-14T10:22:00.001-08:00

An estimated 446,726 properties were hit with foreclosure filings during the third quarter, a 33.9 percent increase from the previous quarter and more than double the number a year ago, according to data aggregator RealtyTrac. Nevada, California and Florida posted the highest rates of foreclosure in the nation, followed by Michigan, Ohio, Colorado, Arizona, Georgia, Indiana and Texas. Arizona is ranked 7th with a 203.1% increase over a year ago. To read the whole article go here.

Oh Canada!

2007-11-13T08:05:00.000-08:00

If you think the value of the dollar dropping is all bad, check out this article recently published in The Star, a newspaper out of Toronto. Canadians have some new found money to spend and some of them are looking South for some real estate bargains. Considering this is becoming the best buyer’s market in a long time, I can’t say that I blame them. I recently spoke with real estate broker Marg Scheben-Edey from Ontario. She definitely has seen an increase in interest from the snowbirds in her area. She has even posted about The Star article in her blog. I have personally noticed an increase in Canadians visiting Scottsdale looking for homes. This influx of money from outside the country may be a little shot in the arm for our sagging real estate market. I have talked to others who believe that we will continue to see an increase in snowbird activity from Canada as the Winter gets colder up North. Looks like we might have a good reason to thank our little brother North of the border.

October Sales Equal to September Sales

2007-11-05T07:49:00.000-08:00

Considering how bad of a month September was for existing home sales, it is not surprising that sales in October were able to match September. There were about 3420 existing home sales in October which is on par with September’s sales of 3430. Typically, October is less than September, but there has really been nothing typical about the current market. September was affected largely by the credit issues in mid-August it was not surprising to see those sales dip. October saw the sale of some of those homes that would have sold in September if it weren’t for the credit crunch. As credit issues subside we should see some increases in home sales. Unfortunately, we are entering the two slowest months of the year for homes sales, November and December. As of today there are just over 57,300 active listings in the ARMLS. At the current sale rate we have over 16 months of inventory. Of the active listings 48.6% or 27,842 properties are vacant. Needless to say, until the number of listings declines considerably the market has little chance of improving.

Sales and Pending Sales Trend over 1 year

2007-10-24T08:06:00.001-07:00

Below is the trend of sales and properties in escrow for home resales over the last year for the entire Phoenix Metro area. As of right now October is looking to be about even with September sales. Properties with a status of Pending appear to be looking a little stronger.

Below is the number of homes on the market each day for the last year.

As can be seen from the chart we are WAY over where we were at this time last year. The amazing thing is 48% of those on listed as of today are VACANT!

Home Sales Plunge by 8 Percent Nationally

2007-10-24T07:28:00.001-07:00

Sales of existing homes plunged by a record amount in September as turmoil in mortgage markets added more problems to a housing industry in its worst slump in 16 years.

The National Association of Realtors reported Wednesday that sales of existing homes fell 8 percent in September, the largest decline to show up in records dating to 1999. The seasonally adjusted annual sales rate of 5.04 million existing homes was also the slowest pace on record.

Read the whole article:

http://biz.yahoo.com/ap/071024/economy.html?.v=8

Best Places To Live? - Phoenix is one of them.

2007-10-08T12:30:00.001-07:00

According to an article in Resident Publications Phoenix is one of the better places to live.

Check out the article here.

September Sales Down Nearly 21%

2007-10-04T09:31:00.001-07:00

The sale of existing homes fell 21% compared to August sales. This is most likely a fallout from the mortgage issues that we experience in August. We are still at about 57,000 homes on the market with 47% of those being vacant. In September 3,300 homes were sold which is lower than any month in the past 6 years. So far October is showing some signs of an improvement over September. At the September rate of sales we have 17 months worth of inventory. Look for October to equal or surpass August sales of 4,200. The best bet at this point is to hold off on selling your home until after the first of the year.

What the Federal Rate Cut Means for Homeowners

2007-09-20T10:49:00.001-07:00

The Federal Reserve said it lowered short-term interest rates by half a percentage point, to 4.75%, to combat the effects of a weaker housing market and tighter credit on the broader economy.

Here is a look at what the Fed's action means for consumers:

Homeowners. The rate cut is good news for borrowers with home-equity lines of credit, and savings could show up as soon as the next monthly statement.
Savers. Savers could soon see lower payouts on their savings accounts, certificates of deposit and money-market mutual funds.
Credit Cards. Many credit-card customers should soon see some relief. About 85% of all credit cards carry variable rates.
Auto Loans. A rate cut isn't likely to have a big impact on new-car loans in part because more than half of all auto loans are already offered at reduced rates due to heavy manufacturer incentives...
Student Loans. Students with private, variable-rate student loans pegged to the prime rate may see their rates adjust more quickly than borrowers with loans tied to Libor.

To get a more in-depth look read the whole article here.

Pending Sales of Existing Homes Fell in July to Lowest Level Since September 2001

2007-09-05T08:09:00.001-07:00

Pending sales of existing homes fell in July to the lowest
level in nearly six years as borrowers struggled to finalize
home purchases, particularly in expensive areas. The
National Association of Realtors said its seasonally
adjusted index of pending home sales for July fell 16.1
percent from a year ago and 12.2 percent from the prior
month.

Read the article here.

August Sales Slowest in over 5 years

2007-09-04T08:52:00.001-07:00

There were only 4,293 homes sold in August which is lower than any other month this year. In fact, it is the lowest number of homes sold in any month since January 2002. This is an indication which direction the market is moving. With September upon us we are now approaching the traditionally slower time of the year in terms of real estate sales. Don’t expect the sales numbers to improve for 6 months. The perceived issues with mortgages will only continue to hinder the sale of homes for the next 6 months or so. Unfortunately, there are 5,924 homes on the market with 47% of them vacant. These vacant homes are really hurting the market and will continue to be a drag on housing until that number decreases. Buyers that have good credit or have extra cash will find the next 6 to 12 months to be a great time to buy. The best time to get into any market is when that market is depressed. I think we can safely say the housing market is in a bad way at the current time. Buying in the right areas is more of a key than buying at the right time. If you are planning to hold onto a property for the next 4 years or so, buying now or waiting to buy in 12 months will not make much of a difference as long as you are buying in the proper location. Of course, make sure you use and agent you can trust.

Are incandescent bulbs a thing of the past?

2007-08-30T08:42:00.001-07:00

More and more people are starting to focus their attention on ways to reduce the US consumption of energy and now Congress is thinking about taking some action. There has been proposed legislation that would effectively eliminate incandescent light bulbs from store shelves nationwide as early by 2012. If every U.S. home replaced one light bulb with a compact florescent light, the country would save more than $600 million in annual energy costs, according to the government. Not only will this help reduce energy consumption it will also help save consumers money on their annual electric bill.

Read the whole article here.

Countrywide taps $11.5 billion credit line AND First Magnus halts loans!!!

2007-08-16T12:28:00.000-07:00

Countrywide taps $11.5 billion credit line AND First Magnus
halts loans all in the same day. Wow, things are going to
tighten even more. This will definitely not be good for a
bunch of people.
Check out the articles by following the links below.

http://news.yahoo.com/s/nm/20070816/bs_nm/countrywide_liquid
ity_dc_10
http://www.azstarnet.com/sn/relatedstories/196683.php

New Home Construction Slows to 10 year low

2007-08-16T07:23:00.001-07:00

The construction of new homes and apartments has fallen to the lowest level since January 1997. Anyone that has been following the real estate market new this would be coming. Builders are in a world of hurt and are just looking to get rid of existing inventory before jumping into new construction. The current mortgage industry in turmoil is also taking its toll on the market making it much more difficult for buyers to get approved for loans especially those with less than perfect credit. The nations largest mortgage lender, Countrywide Financial Corp., will be cutting out most subprime, alt-A and jumbo loan products. This is not going to help the glut of homes on the market.

You can read the whole article here.

Incentives of $100,000 or more!!!

2007-08-13T10:20:00.001-07:00

With the housing market continuing to not look too good new
home builders are offering all kinds of incentives. From
offering to pay two years of property taxes and insurance to
paying 4 months of mortgage payments to giving $100,000
toward upgrades.

If you want a new home, now may be a great time to get one.

Read the article here.

Home Prices Expected to Recover in 2008 As Inventories Decline

2007-07-11T14:38:00.001-07:00

According to the National Association of Realtors (NAR) the
real estate market should start to pick up toward the end of
this year. I also think this to be the case. The average
list price of all the homes on the market has been steadily
declining over the last couple of months and the number of
homes on the market has stayed pretty flat for about 2
months. Look for list prices to continue the decline and
the number of homes on the market to start declining over
the next couple of months. To read the NAR report visit

http://www.realtor.org/press_room/news_releases/2007/hef_jul
y07_housing_prices_recover.html

End Not in Sight

2007-07-03T07:50:00.001-07:00

It doesn't look like the end is in sight for the housing market.
May sales were worse than April.
June Sales were worse than May.
And now according to the NAR the pending home sales are the lowest they have been since 2001.
I have been saying for a while now, if you don't need to sell, don't even try.

Check out the article here.

Housing Foreclosures Jumped 90% in May From Year Ago

2007-06-13T08:49:00.000-07:00

By Reuters

U.S. home foreclosures in May jumped 90% from a year earlier, reflecting a poor spring housing market and foreshadowing even higher levels later in 2007, real estate data firm RealtyTrac said on Tuesday. The May foreclosures -- a sum of default notices, auction sale notices and bank repossessions -- totaled 176,137, up 19% from April, the firm said in its May 2007 U.S. Foreclosure Market Report.

To read the whole article go to CNBC.

New home prices plunge, sales soar

2007-05-24T14:40:00.001-07:00

NEW YORK (CNNMoney.com) -- A big drop in the price of the typical new home sold in April spurred much better-than-expected sales, according to the latest government reading on the battered real estate and home building market released Thursday. New homes sold at an annual pace of 981,000 in April, up 16.2 percent from the revised 844,000 pace in March. Economists surveyed by Briefing.com had forecast an 860,000 rate in April. The gain in sales compared to March is the biggest jump in 14 years. But even with the April spike factored in, April sales came in 10.6 percent below year-earlier levels. The median price of a new home sold in April plunged 10.9 percent from a year earlier to $229,100. The new price reading was also down 11.1 percent from the March reading.
To read the rest of the article go to CNN.com

Bernanke Plays Down Threat From Subprime Defaults

2007-05-18T06:30:00.001-07:00

Federal Reserve Chairman Ben Bernanke said Thursday that the financial system can withstand the fallout from the subprime-mortgage market "without serious problems."

"We have spent a bit of time evaluating the financial implications of the subprime issues, tried to assess the magnitude of losses, and tried to determine how concentrated they are," Mr. Bernanke said in response to a question following a speech here. "There is a sense that, although there is always a possibility for some kind of disruption ..., the financial system will absorb the losses from the subprime mortgage problems without serious problems."

Read the whole article here

Lenders Seek to Modify Rather Than Foreclose Mortgages

2007-05-17T14:40:00.001-07:00

As home foreclosures mount, mortgage companies are knocking
on doors, sending letters and making phone calls with a
simple message for struggling homeowners: They'd rather
modify your loan than foreclose. EMC Mortgage Corp.,
specialist with a $78 billion portfolio of subprime loans --
for homeowners with weak credit -- this week launched a
50-person team it calls "the Mod Squad." Members will spend
an unlimited time on the phone with troubled borrowers,
sifting through their bills to compute a workable monthly
payment. In an industry that often rewards workers for
getting off the phone quickly, the team is preparing to
speak to just three people a day. To read the entire
article go to FoxNews.com.

Pricing turnaround in Phoenix

2007-05-16T09:26:00.001-07:00

The difference between the prices Phoenix homeowners are asking for their properties and what buyers are paying is narrowing, says an article by the Arizona Republic. The gap, which hit a record high in mid-2005, is the smallest it's been since mid-2004. This narrowing could signal a potential recovery for the local market, the Republic says, as buyers and sellers start to agree on prices. The article adds that in the metro area, the market tends to vary neighborhood by neighborhood -- some houses are selling at their asking prices in metro Phoenix, while in some fringe areas of the city, it's more of a buyer's market.

What You Can Do to Avoid Foreclosing on Your House

2007-05-11T06:35:00.001-07:00

By Terri Cullen
From The Wall Street Journal Online

The rate of residential home foreclosure filings dropped dramatically in April, down 14.3% from the previous month, according to Foreclosures.com. Still, year-to-date the foreclosure-filings rate is higher than the same period a year earlier.

What to Do: Depending on your lender, you may be able to restructure your mortgage if you're late in making monthly payments. The delinquent mortgage payments may be added to the mortgage balance, or the homeowner could be given additional time to make catch-up payments. If you can no longer afford your adjustable-loan rate, don't count on bankruptcy court to save your home: Changes in the bankruptcy law in 2005 have made it harder for homeowners to qualify for a "fresh start" and prevent foreclosure. Instead, work with a qualified credit-counseling service to restructure your non-mortgage debt to free up cash-flow. Federal help may also soon be on the way: Mortgage-finance giants Fannie Mae and Freddie Mac are planning to introduce alternative financing to help homeowners with subprime loans avoid foreclosure.

Taking a Dip
Nationwide the number of foreclosures dropped in April.

Supply of Homes Continues To Grow, Reflecting Weak Sales

2007-05-10T08:30:00.001-07:00

The number of homes listed for sale in 18 major metropolitan
areas at the end of April was up 7% from March, according to
data compiled by ZipRealty Inc., a national real-estate
brokerage firm in Emeryville, Calif. The data cover listings
of single-family homes, condos and town houses on local
multiple-listing services.
The increase was above the seasonal norm. Over the past 22
years, home inventories nationwide have increased an average
of 4.5% in April from March, according to Credit Suisse
Group. Spring is the busiest time of year for home shopping,
as families with children try to get settled ahead of the
next school year.
Go to RealEstateJournal.com to read the entire article.

Home Sales, Prices Will Continue To Slide, NAR Predicts

2007-05-09T08:47:00.001-07:00

In its latest forecast for the real-estate market, the National Association of Realtors projected that existing home sales will fall 2.9% this year to 6.29 million, compared with its previous forecast of a 2.2% decline. The drop-off for new home sales is expected to be more severe. The NAR said new home sales are likely to fall 18% to 864,000, compared with the prior forecast of a 14% drop.

Read the whole article are RealEstateJournal.com

London homes world's most expensive: survey

2007-05-08T09:29:00.001-07:00

London beat the glamour of Monaco, New York, Hong Kong and Tokyo to become the world's most expensive place to buy residential property, a survey showed on Tuesday. Residential property in the British capital costs on average 2,300 pounds per square foot, or 36,800 euros (49,889 dollars) per square meter, according to the 'Wealth Report 2007.' That beat nearest competitor Monaco, where property costs an average of 2,190 pounds per meter or 35,000 euros per square meter.

To read more go here.

April Numbers Fall

2007-05-03T16:16:00.001-07:00

Although the official numbers will not be out for another 2 weeks it is safe to say April sales were slower than March sales. I believe this is a sign of things to come. I do not anticipate May sales improving much over April if at all. Unfortunately some sellers are still overpricing their homes. This is just causing an increase in supply and as a result buyers are either sitting around waiting for the prices to drop or picking and choosing the best looking homes out there. There are buyers out there, you just need to make your home more attractive to those buyers.

Fix-It Projects to Speed The Sale of Your House

2007-04-24T07:32:00.001-07:00

For some sellers, a little extra work can mean not only a difference in how smoothly the sale goes or how much they can ask for their home but also if they get to the closing table at all in an uncertain market.

"Talk to Realtors and they will tell you anything you do cosmetically to increase curb appeal is going to help the resale value," said Sal Alfano, editor of Remodeling magazine.

For some good advice on getting your home ready for selling read this article at the RealEstateJournal.com

Four Renovations That Won't Get You a Higher Selling Price

2007-04-23T15:07:00.001-07:00

Four Renovations That Won't Get You a Higher Selling Price
From MarketWatch
These are tough times for home sellers. If you're one of
them, it can be tempting to launch into a series of home
renovations to make your home more desirable.
But be discerning about your choices -- certain renovations
can actually decrease the value of your home. Money magazine
suggests avoiding these four renovations at all costs:
1) Swimming Pool
2) Home Addition
3) Trendy Finishes
4) Jacuzzi
To find out more visit www.realestatejournal.com

March Sales

2007-04-04T09:11:00.001-07:00

So far 2007 is shaping up to be much like 2002.

The number of sales for January, February and March look very
much like the numbers from 2001 and 2002.

2007 sales are about 10% below the 2003 sales figures.
In order for sales to reach 2003 figures there will need to be 7400 homes sales.

With the average price of homes on the market at $469k, I do not see
the situation improving for at least another couple of months.

Lennar profit drops 74 percent!

2007-03-27T09:36:00.001-07:00

NEW YORK (Reuters) - Lennar Corp., the No. 3 U.S. home
builder, posted a 74 percent plunge in profit on Tuesday and
withdrew its earnings forecast, saying the industry's spring
selling season has failed to bloom and its outlook for the
rest of 2007 does not look bright.

To read the whole article go here.

Be Aware of Lock Bumping!

2007-02-09T05:13:00.000-08:00

Lock bumping is a technique that thieves use to gain access to your home even when the
door is locked. It is amazingly simple and takes only seconds for a criminal to break into your house. There are a bunch of videos posted at YouTube and on other websites thatteach people how to lock bump.

To find out about lock bumping watch the following video.

http://www.youtube.com/watch?v=hr23tpWX8lM&eurl

December Stats are out

2007-01-16T14:40:00.001-08:00

For only the second time in the last five years the average homes sold in December increased.

Is this a sign of things to come? Hopefully. The number of homes sold for December are 5,411. This is an increase of 1.37% over November sales and 12.8% below the average number of sales for December. However, with December traditionally being the slowest time of the year to sell a home, the increase in sales over November shows some encouraging signs for things to come. The average sales price dropped by 1.61% in December which is not a very encouraging sign. So we are still in a state of flux when it comes to real estate in the Phoenix area. The current number of homes on the market had been dropping all the way until December 31^st. Starting on January 1^st the number of listings started to increase for the first time since October. As of this morning we are currently at 43,632 active listings on the market, 52.9% of those homes have been on the market for over 3 months. As the prime selling season approaches it will be interesting to see what the trends show. January usually has considerably fewer sales than December, will that be the case this year? I do not believe that will be the case this year. If anything January sales will be very close to the December numbers.

We shall see soon enough.

Arizona is fastest growing state

2007-01-03T12:19:00.000-08:00

Arizona has officially become the fastest growing state in the union.
There is on average 584 people moving to Arizona every DAY!!!
That is over 4000 per week and over 17500 per month.
This fact alone should prove to be a boon for Arizona and Phoenix.
Those moving to the state need a place to work and a place to live.
By the end of 2007 the real estate market should be buzzing along again.

It looks like it is definitely going to be a Happy New Year!

To read the CNN article follow the link below
http://tinyurl.com/ye2yzg

November Sales Data Preview

2006-12-11T09:36:00.000-08:00

This time of year is always slow for selling a home.

I always suggest to my clients that they should wait until

February of the following year to list their house if at all possible.

As anticipated, sales are down in November. We can also
anticipate slower sales in December. It is possible to sell during
December. If you must sell make sure to price your home reasonably.

October Stats

2006-11-15T07:12:00.001-08:00

The stats for October are out and things are looking good.
The total number of sales for October are 5,599 which is
only 9 less sales than September.
The average drop in sales from September to October is 6%.
Last year the drop was over 14%.
Yes the number of sales in October are off from the prior
two years, but the prior two years were out of the norm.
The 5 year average for the number of sales in October is
6474.67.

The average sales price for October was $330,200
This is an increase of 1.76% from September 2006 and a
decrease of 1.99% since January 2006.
October 2006 average sales price is 2.74% higher than
October 2005.

I believe it is more meaningful to take a 6 month rolling
average instead of a month by month average
because individual month sales prices can be influenced by a
few very high priced home sales.
It also gives a better feel for the overall trend.

The 6 month rolling sales price average for October is
$335,267.
Year to date the rolling average has increased 3.58% and is
an 8.45% increase from October 2005.

The above stats were taken from the from the Arizona
Regional MLS Statistics website.
Links are provided below:

http://www.armls.com/pdfs/SoldChartOct06.pdf
http://www.armls.com/pdfs/ListChartOct06.pdf

Builder Financing

2006-11-13T09:24:00.000-08:00

The use of builder financing may not be your best option.

When buying a new home, most people use the preferred lender of the builder. Builder’s often offer incentives to get you to use their preferred lender. The article below points out that buyers should shop around. It might make more sense to use an outside lender.

“To make sure you're getting a good deal, ask the builder not only for the mortgage rate, but also for details on closing costs, points, any fees that will be paid to the lender or third parties, and the terms of the loan. Prof. Guttentag advises comparing that offer to a quote for the same mortgage obtained on the same day from an online lender. He also suggests shopping for financing at the same time you look at houses.”

Read the whole article here.

Platinum Realty Network
www.jimgruler.com

October Data is looking good

2006-11-01T07:33:00.000-08:00

October is now over and it looks like there were at least as many sales in October as there were in September.

Usually there is a decline in sales for October as we get deeper into fall. This increase in sales combined with
the fact that we are now below 47,000 active listings for the first time in a while indicates to me that some sellers
are finally getting the picture and allowing their listings to expire or are taking their houses off the market. I hope
that this trend continues throughout November and December so 2007 starts off with a more reasonable inventory.

With still just over 46% of all listings being on the market for more than 90 days, something has to give.

September Stats

2006-10-19T14:46:00.000-07:00

September stats are in and there really isn’t much of a surprise. Existing home sales are down from August, which is normal. The drop was about 9.9% from August sales. That is a little higher than the average drop in September. The average drop from August to September is 8.93%. The average sale price for September was 324,500. That is a price dropped 2.05% from August. However, that is still 2.75% over the same month last year. Right now I am taking a wait and see approach to the direction of the market. October through January are normally much slower than the rest of the year.

If you would like to see more stats use the links below:

http://www.armls.com/pdfs/ListChartSept06.pdf

http://www.armls.com/pdfs/SoldStatsSept06.pdf

South Scottsdale - Place to be

2006-10-09T12:37:00.000-07:00

If you have any doubts that the next area in which to invest is South Scottsdale, read this:

http://www.azcentral.com/community/scottsdale/articles/1006sr-losarcos1006Z8.html

I have been saying it for almost a year, buy NOW!

Include Real Estate in your Retirement Portfolio

2006-10-05T12:39:00.000-07:00

Here is a good article that talks about adding real estate to your retirement portfolio.

I couldn't agree more. Everyone always talks about diversifying, why not include rental properties or second homes in your plans?

http://www.realestatejournal.com/indinvestor/20061003-hube.html

BTW, did you know that you can use funds from a qualified IRA or 401k to invest in real estate?
This can be done without fees and with the same tax shelters given to securities investments.

September Data

2006-10-03T11:10:00.000-07:00

Now that September is over we can begin to take a look at some sales data. The slowdown of existing home sales continues and the prices decline slightly.

In September there were 5554 homes sold which is a decline of almost 11% from August. The average purchase price was 325,806 which is a 1.66% drop from August. There are over 20,000 homes that have been on the market more that 90 days!!! This means that there are at least 20,000 homes that are over priced and I am sure there are even more than that. I believe the number of homes on the market will decrease significantly over the next couple of months. Those sellers who don’t need to sell will start cancelling their contracts or will start letting their contracts expire as the holidays get closer. The sellers who really need to sell will have to start lowering their asking price. We are coming into what is typically the worst time of year to sell your home. If at all possible, get it on the market now or wait until next year.

Preparing to sell

2006-09-26T10:48:00.000-07:00

I am often asked what can be done to sell a home faster?

There are a number of things that can be done to help move a house.
I am assuming the property is priced properly for the current market conditions.

It is important to make a good first impression. That is why curb appeal is at the top if my list. If potential buyers are not invited into the home from their vehicle, many will never stop and check out what’s behind the front door. The goal for any seller should be to get as many potential buyers into the house.

Remove any clutter and excess furniture. A home can feel much smaller when rooms have too many pieces of furniture or a bunch of stuff in the rooms. It is always a good idea to see if you can store some excess furniture at a family member’s home and clean up the clutter.

Painting and cleaning are also very important. Do not turn off possible buyers because you don’t want to clean the house. Hire someone to do it if you don’t want to do it yourself. Would you rather spend $200 on a thorough house cleaning or have your house on the market for 3 months? Just because your house is on the market doesn’t mean that you are finished taking care of it. Buyers have to be able to see themselves in the home and if there are dishes in the sink, garbage on the coffee table and the rooms are just generally dirty, the buyers will want to leave the house as soon as possible. Not the impression you want to make.

So, if you want to increase your home’s salability spend a little time and possibly money to get the home in a clean and presentable state. Your efforts will be rewarded.

2007 Economic Outlook

2006-09-22T12:12:00.000-07:00

Yesterday I attended the 2007 Economic Outlook put on by the Greater Phoenix Chamber of Commerce. It was very informative and worthwhile. Presenting information on the real estate market was R.L. Brown. I was very happy to find out that I am on the same page as him. The real estate market will be fine once all those “fishers” realize that they are not going to get any bites and either lower their prices to within the realm of reality or they get their homes off the market.

There are currently 47858 properties on the MLS with 20816 of those properties having been on the market for over 90 days. Don’t these sellers realize that their house is not selling because they are priced too high?
Craziness, just craziness.

Visit the Phoenix Business Journal or azcentral.com to find out more about the 2007 Economic Outlook.

House Showing

2006-09-20T06:59:00.000-07:00

This weekend while I was showing some houses to a client I was reminded just how much help the average homeowner needs in selling their home. I walked through a house that overall was very nice. It was priced a little high but on the immediate surface it appeared as though it could demand the price. After about 10 minutes in the home and viewing the rooms from different angles it became apparent that the seller just gave up and stopped working. There was an end panel on the kitchen island that was missing, outlets without any covers, baseboards that were about 1 inch short in a couple of places. The backyard was basically barren. It looked like it hadn’t been watered in a couple of months. And the A/C condensation line was dripping 2 feet outside a back door onto concrete.

If you are really interested in selling your home, try to walk through your home with an unbiased point of view and make a list of things that you would want finished if you were the buyer. Even though the above mentioned issues were minor and very inexpensive to rectify, buyers will be put off by them. It can also result in a lowball offer because the buyer will think, if these little things are not finished what big things that I don’t see could be wrong.

This house has been on the market for quite some time and it is a shame that the owners just seem to have given up on it. All agents should tell their clients to fix those items which are immediately apparent to a prospective buyer. And all sellers should heed their agent’s words.

August Statistics

2006-09-15T10:48:00.000-07:00

August statistics are in:

Average Sale Price: $330,900 down .63% from $333,000 in July

Average Days on Market: 77 up from 73 in July

Number of houses Sold: 6163 up .99% from 6102 in July

The number of home sales increased slightly in August. Ignoring last year’s craziness, this is an unusual occurrence. August sales typically decline with a further fall off in September. It will be interesting to see what the September numbers show. So far in September it looks like we will have a decline in sales, but that can change. If the typical trend holds (4% decline) we should have roughly 5900 sales in September.

	ALL	Distressed	Distressed PPSF	Not Distressed	Not Distressed PPSF	% Distressed
Active	416	117	146.26	299	308.72	28.13
In Escrow	108	78	147.25	30	224.16	72.22
Closed - MTD	13	3	112.99	10	206.14	23.08
Closed - 01/2010	36	22	141.54	14	167.80	61.11