Archive for September, 2010

Short Sale Fiasco

September 8th, 2010

No matter how hard the sellers and buyers try to complete a successful short sale purchase, there is always a 3rd party who makes the final decision. After waiting for 6 months, Aurora Loan Services said “NO” to my buyers contract on a home in Gilbert.

Chalk another screwed up short sale to Aurora. I believe they purposefully strung this along so they can foreclose. They totally mislead the seller, the buyer and the agents involved. The National Association of Realtors or AZ Association of Realtors should be compiling statistics from Realtors and go in front of Congress and the American public to disclose how (with some banks) the short sale process is a total sham. OK, I’m venting.

Here’s the back ground info:

My client, from out of state, was looking for a home where he could eventually retire to during the winter season. Since he wasn’t ready to retire for the next 3-5 years he wanted to rent it out. He wanted to take advantage of the very affordable housing market in the Ahwatukee, Chandler, Gilbert or Tempe area.

We found a 2100 sq ft, 4 bedrooms, 3 bath home in Gilbert built in 2001 with a tenant who had 11 months still on the lease. The Buyer made an almost a full price cash offer and it was accepted by the seller.

Since May, Aurora had indicated they had all of the necessary short sale paper work but then they would need something updated, such as the seller’s most current bank statement. This went on for 3 more months. Aurora would say …”Yes, we have everything” and then ask for an updated document. They postponed the foreclosure (Trustee Sale) 3 times while this went on.    

The seller has been unemployed for 10 months so there was a definite hardship. The current rental income doesn’t come close to covering the mortgage and taxes. To agree to the short sale, Aurora wanted the seller to pay $7,500 cash at closing PLUS sign a promissory note for $20,000. They were going to require the promissory note knowing full well that Arizona is an anti-deficiency state. This means the bank (Aurora) COULD NOT collect the difference on the short sale but yet they still wanted the $20,000 note!!!

Back in February, I thought it was the perfect situation for all…. seller sells via short sale, renter gets to stay in the house for at least another 11 months, and my buyer gets an investment home for his future retirement. But obviously it wasn’t in Aurora’s best interest.  

This is just an example of some of the pitfalls of short sales.  Others include buying property “AS IS”, unnecessary damage done by short sale seller when moving out, the length of time to close, higher buyer’s closing costs and the bank changing (or canceling) the terms of the purchase contract.

I have helped many buyers and sellers complete successful short sale transaction. They have been very satisfied with the outcome. However, this sale has taught me to advise future buyers of my experience with Aurora.

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Posted in First Time Home Buyer, Foreclosure Articles, Short Sales

Real Estate Recovery? Some Areas, YES!

September 2nd, 2010

For those of us who live in the Phoenix metropolitan area, excitement is in the air!  It is the first of September, which means our reason for living here is just around the corner…patio living, walks in the neighborhood and cool evenings are on the way! 

 

A new season means it is time to do yet another analysis of the real estate market in the greater Phoenix area. This includes cities in the east valley such as Chandler, Gilbert, Mesa, Scottsdale and Tempe as well as cities in the west valley such as Avondale, Buckeye, Glendale, Goodyear, Peoria, and Surprise. There are pockets of continuous growth while there are many areas that are still experiencing some ups and downs.  Like other cities in the United States, the Phoenix real estate market got a “shot in the arm” when some buyers were able to take advantage of the temporary First Time Home Buyer Tax Credit.  As nice as that was for many, it inflated the recovery of the real estate market, so one must keep this in mind while reading journals, newspapers and blogs that report August sales numbers. 

 

There is one segment of the real estate market that seems to be leading the recovery.  Even though the 55+ communities such as Sun Lakes, Sun Bird, Springfield and Del Webb Solera have experienced minor price decline since 2007, in 2010, they have been showing a steady increase in value.  For example, per the Cromford Report, Sun Lakes, located south of Chandler, has seen an increase in the average sale price of $232,616 in November of 2009 to $244,756 in July of 2010.  See chart below.  In partial, this is due to the fact there are fewer short sales and foreclosed homes in the 55+ communities.  These areas also continue to draw from those who want to live in a warmer climate during the fall, winter and spring. 

 

Many of my clients, who are still working, are not ready to retire, yet are taking advantage of these low prices in the market, as compared to just four years ago.  Knowing these prices may never be this low again, they are acquiring properties for their future.  I have several clients who are renting their Arizona property until they retire and spend their winters here.  With our sought-after winter sunshine, the 55+ communities are in demand for fall, winter and spring rentals.  As the Baby Boomer generation continues to mature, the demand for these communities will always be present.

 

If you are interested in finding out more about how to take advantage of this market, please contact me at (480)688-3612.  You can also start your no obligation search by clicking on Search Homes and fill in your criteria. If you want to see specific homes in Sun Lakes expand the plus symbol next to SE Valley, scroll down to Sun Lakes and fill in the rest of your home features.

 

I look forward to helping you with any of your real estate needs.

Cromford Sun Lakes Ave Sale Price 08-2010

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Posted in Foreclosure Articles, Real Estate Market Report, Retirement, Short Sales