Seems the whole world at the end of any given year going into the next makes New Years’ Resolutions and Goals of things they’d like to do in the following year. 

For me, to be a better Mom and Wife and take better care of my health… pretty boring stuff- somewhat the norm- I do also want to buy a home again myself as my own waiting period of 3 years after a Short Sale or Foreclosure is coming around already and I figured I probably wasn’t the only one.  Since 2007, with the help from my team, we’ve helped over 300 families either Short Sale their home OR buy a home and we’d love to do the very same for you or someone you know that may need our help. If you are one of our past clients, the timing may be right for you this year to buy again too?

IF SHORT SALE is something you’ve been putting off- PLEASE DO NOT put off any longer- as it stands now, The MORTGAGE FOREGIVENESS ACT OF 2007 signed by Bush is set to expire at the end of this year.  Short sales can take 3-6 months on average.  If this does not get extended soon, I predict that we are going to have a rush of Short Sales towards the second half of this year which may cause additional “traffic jams” with the lenders. Some folks trying to do a Short Sale in 2012 may miss the boat entirely for the forgiveness of the “Phantom Income” that the banks issue via 1099s at the end of each year from their losses on distressed loans. DON’T let this happen to you or someone you know! Click Here to get started with the Short Sale Process

On the flip side, it’s never been a better time to buy- RATES are @ 4% and sales prices lower than I’ve seen in most of my nearly 20 year career in Real Estate.  Click Here to see the in depth Power Point Presentation from Mike Orr of the Cromford Report with very interesting statistics on our current market and what it’s done the last couple of years.

Either way- we are here to serve! Please feel free to call us anytime at 480-243-4242 for help achieving your Real Estate Goals!

<<——–PLEASE CLICK MICROPHONE TO LISTEN TO REBECCA HIDALGO, DESIGNATED BROKER OF INTEGRITY ALL STARS, TALK ABOUT SHORT SALES ON THIS WEEK’S EPISODE. (She goes on from minutes 10-18 on podcast)

If you or anyone you know is in need of help, found themselves upside down on their home and they may or may not be able to still make their mortgage payments- have them call 480-243-4242 for a free personal consultation OR click here to get started.

Larry Ricci of Going Green Solar joined Rebecca today to share with her the news about this exciting program that incentivizes Buyers of homes to install Solar Panels in their homes along with a few other energy efficient items; build it into their purchase loans, and they get up to $17,500 back in tax credits and rebates. Please call Larry directly at 602-301-0022 for specific questions & you can click here for a Brochure on the program highlights.

If you think you lost out on the First Time Home Buyer Credit- for the right person and home- this may just be PERFECT! We’ll be happy here at Integrity All Stars to help you get going with this if you are interested in learning more and finding the right house that will qualify- give us a call here at 480-243-4242 OR click here to get started.

Every Month we like to post the latest article by Mike Orr to educate our clients on the most recent stats in our local Real Estate Marketplace.  Very few have not been affected and with prices comparable now to those of nearly 20 years ago, we are seeing very little inventory out there for buyers to pick from.  

CLICK HERE to read Mike’s entire article; but here’s a summary quote that is very telling.

“It seems to me that although the supply/demand imbalance is becoming extreme, demand from investors alone is unlikely to sustain a significant upward price movement. We may have to wait until the general public realizes the degree to which the reality and perception of the supply picture have diverged, so that fear of missing out on a bargain overcomes the fear of prices dropping yet further.” 

Our thoughts is that once word is out to those “fence sitters” that there are few “good” houses out there right now, those prices will start to climb as more competition hits our local market place.  Don’t miss the “bottom” if you are thinking about buying!  And for those of you wanting to (Short) sell, homes are going fast- before the holidays roll around and it slows down- give us a call to discuss your options 480-243-4242 or CLICK HERE to get started.

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It feels almost like the inverse of 2005.

In the second half of 2005, supply rose dramatically but no-one seemed to take any notice. There was a widely believed myth that prices could never go down. Between March 31, 2005 and June 30, 2006, active listings rose from 8,394 to 45,729 (up 445%) creating a huge glut of homes for sale. Yet average sales prices continued to rise throughout this period, up 28.6% from $146.98 to $189.05 per sq. ft. Meanwhile demand fell 16.5%, with sales per month dropping from 8,490 to 7,093. It was as if everyone believed the laws of supply and demand no longer applied. Of course we found out by 2007 that supply and demand really did matter and the bubble burst explosively in 2008 causing untold damage to the economy and family finances.

It’s a question of timing. Supply and demand do control pricing, but in real estate there is a very long time delay between cause and effect. That timing can be extended even further by sentiment. In 2005 sentiment was off-the-charts positive – "irrational exuberance" ruled the roost and caused people to make decisions that in hindsight look crazy. Not just homeowners and developers, but especially lenders and the investors who fueled the credit surplus. Those few of us who tried to warn people in early 2006 that prices would fall dramatically were treated a bit like Harold Camping predicting the end times.

The opposite seems to be happening now. Sentiment is very negative. Everyone seems convinced that prices can only fall further, yet demand is rising and supply has been falling like a rock dropped off a cliff for 6 months now. It comes down to one simple fact: people believe what they want to believe. The facts do not exert a significant influence.

Here at the Cromford Report, we only deal with facts and figures, not beliefs, so here is the market update.

Sales – We are currently recording 9,814 sales in May. This is up 3.5% over April and up 10% over May 2010. This is a very strong sales total because in May 2011 sales are not being boosted by the government bribe (sorry, tax credit) that applied in 2010 for buyers of owner-occupied homes.

Pending Sales – At 13,268 on June 1, pending sales are down 0.4% compared with May 1 but up 6.7% compared with June 1, 2010. Again an extremely strong indicator of demand. In 2010 demand fell sharply during the summer after the tax credit expired, but there is no sign so far that the same will happen in 2011.

Active Listings – At 31,346 on June 1, active listings are 9.4% below May 1 and 23.3% below June 1, 2010. Supply is clearly falling fast. However this understates the situation because a large proportion of the active listings already have a contract against them. In fact there were 7,737 AWC (active with contingent contract) listings as of June 1, 2.6% higher than the very high level we saw on June 1, 2010. If we exclude these AWC listings, we have only 23,609 active listings, down 12.7% in a month and down 28.8% compared with last year. This is almost 60% down from the peak of October 2007.

Supply Versus Demand – The average months supply (active listings divided by monthly sales rate) for the period Jan 1, 2001 to June 1, 2011 is 5.9 months. Right now we have a 3.2 month supply. Yet we read everywhere that there is a "glut of foreclosed home on the market". What we are reading may have been true in November last year. It is not true now. In fact available supply is really even tighter than this. If we only count active listings that don’t have a contract the months supply number drops to just 2.4 months. Anyone who thinks this is a "glut" is not living in the real world. They should just ask anyone who is actually trying to buy a home right now. Competition is intense, and not just for bank-owned homes and trustee sales. It is also heating up for short sales and normal listings. If you are trying to buy a home that is at all desirable and is priced at market or below, expect multiple bids. If you are a seller, then you only need to price realistically and your home will sell quickly.

(All the above numeric information is for "all areas & types" within ARMLS.)

Records Being Set

In Maricopa County, May saw the largest ever number of distressed homes disappear from inventory. Pending foreclosures fell by 3,394 homes while REO inventory fell by 971 residential properties.

For Maricopa County, May gave us the highest ever percentage of out-of-state buyers. 29.9% of sales went to non-Arizona residents. The average between January 1999 and May 2011 was 11.9%. The absolute count was also a record – 2,648 homes sold to out-of-state buyers. The average since Jan 1999 is 1,446.

For Maricopa County, May saw the highest ever number of foreclosures selling direct to third parties at the courthouse steps. The record set was 1,476, 33% of all the trustee sales.

Paradise Valley

Exceptionally strong market activity is occurring in Paradise Valley where sales are now averaging 52 per month compared with 31 last year at this time. Inventory is down to 319 from a peak of 581 in April 2009 when sales were averaging only 9 per month.

Prices

After a bump upwards between mid April and mid May, average sales price per sq. ft. is back down a little at the beginning of June. Although we are still some 2% to 3% above the market bottom in January and February this year, in most places prices have not yet responded to the huge changes in supply and demand. Why not? Please refer to what happened in 2005, but with everything upside down. The rules of supply and demand have not been lifted. Of course, you don’t have to believe me, but please don’t say I didn’t warn you.

GREAT NEWS- and for those of you who’ve been waiting to buy, give us a call at 480-243-4242.  (Mike Orr of the Cromford Report is one we quote often on our website as well.  See article below by him.)

This Summer will prove to be one high in competition for the “good” ones out there!

The most impressive thing about the month of March 2011 was the huge unit volume of closed sales. We are currently showing 9,901 closed sales on ARMLS for all areas and types. That is the 5th highest monthly total ever recorded on ARMLS and the second highest sales volume ever for the month of March. The only months which have surpassed it were June 2005 (10,213), August 2005 (10,002), June 2004 (9,973) and March 2005 (9,949).

Meanwhile demand is accelerating while supply is falling quickly.

Supply is falling in almost every geography and price range but is most noticeable at the price ranges below $150,000 and in the outskirts of the valley, particularly in Maricopa (city), Queen Creek, Anthem, Casa Grande and Buckeye, This largely due to enthusiastic buying of homes built in the last 15 years which can be found for sale at a discount of 70% or more compared with their price at the time of construction.

Trustee sales in Maricopa County hit a high number of 5,226 in March, due to the trustees catching up from the Bank of America moratorium in November last year. Notices of trustee sales were only modestly up from February at 5,397, which is not an impressive number given that March contained a lot more working days for lenders than February. As a result the number of homes pending foreclosure dropped sharply during March to the lowest number since March 2009.

Third parties buying at trustee sale made a new record with 1,379 purchases (26.4% of the auctions). This is by the far the largest number of properties ever purchased at trustee sale. Another 3,842 properties got no bids and went to the beneficiary to become REO inventory. This may help slow the fall in the REO inventory listed for sale of ARMLS.

Lenders seem to have noticed the enthusiasm of buyers and having allowed the average list $/SF of REOs to fall between April 1, 2010 ($87.56) and March 20, 2011 ($68.84), they are now increasing them again and the average list $/SF has popped up 3.5% in just the past 2 weeks. Asking prices for short sales and pre-foreclosures seem to have stalled at around $79 to $80 per sq. ft. Normal listings have been increasing in list price for some time, reaching a low of $185.93 on September 24 and rising by 4.5% over the last 6 months to hit $194.37 today.

While average sales prices are very slightly higher in March compared with January and February, there is still no clear sign of a significant trend forming. The median sales price has been stuck at $110,000 for three month now., again with no sign of a major move either up or down over the short term.

With the balance between supply and demand changing quite quickly for the better over the last four months, we are down to an overall inventory level of 4.2 months based on the monthly sales rate. This can be regarded as a "normal" reading for the time of year (it is below the 4.5 we measured in 2002 at the same point in our last "normal" year). This goes a long way towards explaining why prices have stabilized once again.

Currently the trend is for supply to fall further and demand to increase, and if this continues then at some point it is likely to lead to prices moving higher. How soon and how much, it is too early to say. However it is not too early to say that prices are unlikely to fall to any significant degree while this situation persists. Last year the disappearance of the tax credit at the end of April caused the market to deteriorate suddenly in May and pricing fell sharply between July and September. At the moment we see no indication of a similar interruption to the recovery process that is now under way.

(Report from Mike Orr of the Cromford Report)

Please call us at 480-243-4242 if you are looking for a home to purchase and we’ll happily send you a customized list (at no charge) or start shopping here on our website.

If you are watching average sales prices then you are probably bored – nothing much is happening at the moment. They are not going up or down, just wobbling around unsteadily like the Inception top, although they gave up around 12% between July and January.

However we don’t advise watching prices right now. They are the very last indicator to turn round at both the top and bottom of a cycle. The indicators you should watch instead are behaving in very interesting ways at the moment. Most of these ways are very positive. Nothing is certain in this world but the current trends are pointing to another market recovery attempt, similar to the one we saw in 2Q 2009.

Supply

We measure supply using active listing counts. These are coming down fast in many (but not all) areas. The total number for all areas & types in ARMLS residential resale as of March 1 was 40,240. On February 1 this was 42,522 so we are down 5.6% in a single month. Last year on March 1, we had 42,139, so we are down 4.5% in 12 months. This latter number doesn’t sound very impressive, but supply was growing last year from June through November, peaking at 45,960 on November 20. Supply has fallen by 12.5% since November 20 and this is a definite signal that overall supply is now on a strong downward trend.

Demand

We measure demand using two primary indicators – recent sales and pending listings – and we also keep a watchful eye on total listings under contract (i.e. pending plus AWC). At the moment we are recording 7,155 sales (all areas & types) during February 2011. This is 8.6% higher than January and 11.4% higher than February 2010. Not too shabby. In fact this is the second highest February sales total for ARMLS (Feb 2005 came top). Pending listings were 11,997 on March 1, up 13.6% from February 1 and 1.8% below March 1, 2010 when we in the grips of tax credit buying fever.

These are good demand numbers.

Supply vs. Demand 

Demand is strong and supply is falling, so that ought to be good for the market. However sentiment is still very negative after the double dip price drop during the second half of 2010 and it always take several months for an improvement in the market balance to be reflected in pricing.

SOUNDS LIKE ONE SITTING ON THE FENCE AND WAITING TO BE SURE IT’S A GOOD TIME TO BUY MAY END UP PAYING MORE! THE INDICATORS ARE STRONG SHOWING THAT THE PRICES WILL START TO GO UP IF THIS CURRENT TREND CONTINUES.  ALSO, DON’T FORGET RATES HAVE BEEN TRENDING UPWARDS AS WELL THIS LAST 6MTS.  THOSE THAT WAIT TOO LONG MAY MISS THE BUS ALTOGETHER!

IF YOU ARE INTERESTED IN READING THE REST OF MIKE ORR’S ARTICLE REGARDING OUR CURRENT LOCAL MARKET- PLEASE CLICK HERE

Please feel free to start shopping for homes on our website or call us at 480-243-4242 to have a customized list emailed over to you or someone you know who’s been thinking about buying a house before this great opportunity to take advantage of our current market is missed!