Open House in the Catalina Foothills

Good Morning! Today I'll be hosting an open house in the Catalina Foothills. This is a great property that is priced to sell! If you are thinking about buying or selling a home in the Catalina Foothills, this is a great location near Kolb and Sunrise. To the left is a photo of the house.

The description of this property is as follows: This beautifully updated home sits on a quiet cul-de-sac in the desirable Catalina Foothills. All three bathrooms are spectacular with a jetted tub in the Master bath. The family room features a built in flat screen TV with surround sound speakers. French doors open to a lush, private greenbelt, which is bordered by the back yard from both the Dining and Family rooms. The Master bedroom has it own French doors to its covered deck with dramatic mountain views. This home was recently appraised at $385,000.

This great Catalina Foothills property is indeed priced to sell & offers a great value for discerning buyers looking to get a deal on Tucson real estate! Stop by Sarah Ley's open house from 1-4 PM on Sunday, January 25th, 2009 to see this property. Hope to see you at the open house! You can find this property in the Tucson Realtor's MLS as MLS #20840105. Click on the link above for complete property details and directions.

Written by Sarah Ley,

BSBA, ABR, CRS, CNHSA,
Realtor with Long Realty Company

Direct: (520) 404-0544

http://www.sarahley.longrealty.com/

sley@longrealty.com

Inauguration Day is Here!

Most folks are going to be paying at least some attention to the festivities of Inauguration day. This is sure to be a very exciting and historic day! Here is an internet feed, that if you click on this link-- will enable you to watch history in the making from your computer.

Incidentally, if you are thinking about Tucson real estate today, I am here at my office- actually working! We had our office meeting this morning, and a couple of interesting announcements were made. One is that new construction sales prices in California (our market patterns usually follows theirs after a few quarters), are down. The median sales price for new construction in California has dropped 35% from December 2007 levels to $278,000. Obviously, builders nationwide have taken a huge hit with the declining economy, and home starts are way down from a year ago. The fact that new construction home prices have dramatically declined is a signal of waning demand from buyers. The construction industry is counting on Obama to help them change the rising tide of losses that is weighing down the entire industry.

Home buyers in general are now very skeptical about making a mistake. They do not want to buy a home in a down market, and then have the value decline even more. Ideally, this may be the best time to buy, as there is one thing for certain-- you cannot ever time the bottom of the market! If you are planning to live in the home, and plan to be there for at least five years, you can usually ride out any bumps in the market. If you're thinking of buying new home construction in Tucson, builders are offering many incentives to gain your business. In addition to reduced prices, you may get free upgrades, free lot premiums, and possibly even financing incentives. There are currently so many options out there for Tucson home buyers, this is (in my professional opinion), a great time to buy a home in Tucson!

Additionally, if you are thinking of buying or selling investment property in Tucson, this may be the year to do it. I have some great information about buying investment property in Tucson on my website. Because prices have dropped, and are now on average at or below 2004 levels, and also interest rates have declined-- you can now buy investment real estate in Tucson with a positive cash flow. There are many bank owned properties that are being sold at great discounts from what they sold for at the peak of the market. If you are thinking of buying or selling bank owned (REO) real estate, or are interested in finding more out about short sales, please do not hesitate to contact me. I do have an investor client who is now buying his third bank owned property. Granted, many of these houses need work. But if you are willing to put in a little sweat equity, it can pay great dividends in the long run.

Enjoy Inauguration Day! Please feel free to call me with any questions you may have about Tucson real estate in 2009.

Written by Sarah Ley,
BSBA, ABR, CRS, CNHSA
REALTOR with Long Realty Company
Direct: (520) 404-0544
http://www.sarahley.longrealty.com/
sley@longrealty.com

Ready, Set-- Obama!

I notice a refreshing enthusiasm in the crisp Tucson morning air today. January has always been the start of a new year, and the motto, "Out with the old, in with the new," has been the mindset (at least for the first couple weeks of the year), until new year's resolutions vaporize like money invested in the stock market did in 2008.

But this January is markedly different. The excitement is palpable. As he said so eloquently in November, "Even if you didn't vote for me, I am still your president." Tomorrow is an important day, as is today, Martin Luther King Jr. day, for all Americans-- no matter the color of their skin. Being an American is about freedom, and idealism, and always believing that we have what it takes to pave the way for our children to have a better tomorrow. Qualities that I believe our new president will bring back to us in dramatic ways. It will be emotional, as is any big change. I am hopeful that Obama will rally Americans to find new hopes and ideals in themselves. He will indeed be a president of change, a desperately needed positive force for this ailing nation.

Housing is at the forefront of critical issues that Obama will need to confront head-on in the early days of his presidency. It is believed that Obama's policies (even though we don't fully know what they are just yet), will have a positive affect on the housing market. If anything, what people need right now is hope. Hope is what we've lost with all of the retirement accounts that vaporized in 2008, with all of the jobs that were lost, with all of the people who lost their homes. Simply stated, the American people need someone who will breathe new hope back into this nation, and I think the right man is in the driver's seat.

It's all about perception... Perception is reality. If that is true, consider this. The housing boom of the last few years was brought about by a huge availability of credit. It was fueled by credit, and now it is frozen by the same demon that fueled it. The lack of available credit, and the fact that more and more Americans have lost fortunes and jobs, is causing a 'withdrawal affect,' which means that people are doing things that pull money out of the economy, instead of putting money into the economy- which is what is needed to revive it. I remember learning about this phenomena in Economics 101 at the University of Arizona. My professor said that when people stop spending money, jobs are lost (unemployment goes up), stores and restaurants go out of business (demand for goods and services declines), and credit dries up (banks have less money to lend). If it gets bad enough-- which is debatable that it may be 'bad enough' right now, a deep recession is going to be the result. This link is a very interesting power point presentation that details what caused the recession, and what we need to do to end it.

It's funny how perception works though. If people perceive that things are better-- or that they are getting better, then they will change their patterns. They will go out to dinner again. They will buy that lottery ticket. They will take that weekend trip to the White Mountains. They will go to the Wildcats game. This is what we need right now (the restoration of consumer confidence). Once consumer confidence is restored, the economy as a whole will begin to recover. We desperately need to ensure the general public that the economy will be restored, so their confidence is restored.

Being that Tucson has taken a hard hit with foreclosures, business closures, and job losses, I have auspicious aspirations that 2009 will have good things in store for us. But then, I am an optimist. I'm glad that our new leader is too. If you have any questions about buying a home in Tucson, or possibly selling your Tucson home in a down market, please give me a call. I am a qualified and professional Tucson Realtor who has been successfully assisting clients in the Tucson real estate market since 1999. As Obama says, "Yes we can!"

Written by Sarah Ley,
BSBA, ABR, CRS, CNHSA
Realtor with Long Realty Company
Direct: (520) 404-0544
http://www.sarahley.longrealty.com/
sley@longrealty.com

The Tucson Real Estate Market Report

I just posted quite a long blog article yesterday, titled "The State of Tucson Real Estate in January 2009." This blog included many newsworthy updates from NAR (The National Association of Realtors), as well as some news from Fannie Mae and Freddie Mac about letting renters of foreclosed homes stay on after the owner is foreclosed on.

At any rate, I started thinking that readers would like to access the Long Realty Tucson area housing report, as this report contains a great deal of factual information about what the local market is doing. If you click on this link, you can directly access the housing report for January 2009 for the Tucson real estate market. Basically, inventory is down, and sales are up. We can attribute this to a few different factors, the main one being that buyer demand is picking up. The fact that interest rates and prices have both come down significantly (interest rates are at 30 year lows, and prices are at or below 2004- prior to the boom levels), is helping to fuel buyer demand.

Existing hom sales are up for this reason. This has already happened in California (and they boomed before we did in Tucson). When I was visiting San Diego last August, I read an article in the San Diego paper that stated 40% of all sales in the summer of 2008 in San Diego were foreclosures. I thought that was a ridiculously high level, and I never thought that we'd see that many foreclosures here in Tucson. However, in November 2008, approximately 32% of all the sales were foreclosed properties. This shows that investors are taking advantage of some value in the market. Indeed, there is value out there. I predict that we may even start seeing some investors flipping homes in then coming months, as many first time home buyers do not have the cash to fix up a home that's been trashed by a foreclosed owner. They would rather purchase something that is move in ready, and as long as they can afford the monthly payment and also come up with the down payment (which is 3.5% for FHA buyers), they would be ecstatic to get a move-in ready home.

All of this is great news for Tucson home buyers. If you are in the market for a home, or are thinking that now is a good time to buy-- you are right! If you're buying a home for your primary residence, you may wish to avoid short sales, as they can take several months to close, and I have heard horror stories of the banks pulling the plug on the deal at the last minute. However, if you're not going to live in the home (and are buying it as an investment), a short sale may be well worth your while to look into. Bank owned properties can be great deals, but the majority of them need a lot of work, and it's like the quote from "Forrest Gump," "Life is like a box of chocolates, you never know what you're going to get." It is sort of like peeling an onion when you purchase a bank owned property, as there is no telling what the foreclosed owner may have done to the house out of anger of losing their home. This is not always the case though. I sold a bank owned home in November that was built in 2006, and it was just like new. There was absolutely nothing wrong with it, and my buyer got a fabulous deal. The buyer actually got into the home for only $4,000, with an FHA loan, as the bank seller (Freddie Mac) had a special deal where they pay all of the buyer's closing costs.

At any rate, if you are thinking of buying or selling a home in Tucson, please don't hesitate to give me a call. I can honestly say in my 10 years of selling real estate in Tucson, I never thought we'd see a market like this-- but it is a great time to buy!

Written by Sarah Ley,
BSBA, ABR, CRS, CNHSA,
Realtor with Long Realty Company
Direct: (520) 404-0544
http://www.sarahley.longrealty.com/
sley@longrealty.com

The State of Tucson Real Estate in January 2009

It was announced in the Arizona Daily Star this week that Arizona is one of four states (others are California, Nevada, and Florida) with the biggest percentage of foreclosures. The foreclosure rate last year in Arizona was double the level in 2006, and is reaching epidemic proportions. Each day as more Tucsonans fall into a possible foreclosure situation, I thought it would be beneficial to look at some steps that people can take to try to stay in their homes.

It is important that the Tucson homeowner face the issue head on, and prepare for days and weeks of making phone calls, and working tenaciously to correspond with companies and people who may be able to help you save your home from the painful personal and financial affects of foreclosure. Don’t automatically assume it is too late to act. As long as you are still residing in your home, you probably have a decent opportunity to be able to keep your home. People facing foreclosure have more avenues to pursue than they might initally realize. There are definitely more options than the 'pay what you owe or lose the home' notices that many people believe is their only choice.

A few potential solutions for Tucson homeowners in trouble include:

1) Negotiating a modification of the loan. You can work directly with your lender to attempt to get the terms and interest rate of loan renegotiated, to have a payment that is doable for you.
2) Refinancing the loan. This may be tricky- especially if your credit has been tarnished in the process. However, there are debt reorganization companies that can help work with you to accomplish this.
3) Listing your home with a Realtor for a possible “short sale.” Make sure that your Realtor is skilled in the short sale process, and can work with your lender to try and negotiate a price that will be acceptable to them.
4) Filing for bankruptcy. You will need to retain the services of a qualified attorney to do this, and it will cost you some money. Then you will most likely end up walking away from your debt obligations. I had a client who did this a few years ago, but was still unable to avoid the foreclosure.

A Short sale may be one of your best options to avoid foreclosure and save your credit from the dire affects a foreclosure can have on one's credit score. A short sale is a sale in which the lender agrees to take less than what is owed on the home. This is done by the lender agreeing to write off a portion of their loss. The benefit to the lender is that they can avoid the possible costly expense of a foreclosure. Short sales are typically negotiated by Realtors who are skilled in this area. This will help take pressure off the homeowner, so that they can possibly stay in the home longer. Many professional Tucson Realtors are adept at working short sales. Additionally, there are many buyers who are looking specifically for bargain priced homes. As a caveat, the the process of a short sale can be slow and frustrating, and they have been known to take up to nine months to close. For this reason, many of them end up falling out of escrow, and only about 30% of the short sales negotiated with a buyer actually end up closing.

The problem is that most banks are not moving fast enough to agree to the terms of a short sale. They are sitting on decent offers- thinking that the house could possibly fetch more money. In many cases, given market conditions- this is at best wishful thinking. The banks are not considering that foreclosure will cost them a great deal more in lost time and money in the long run. Although short sales are difficult to navigate, they can be done. They may be one of the best possibilities to currently help troubled homeowners avoid foreclosure.

This just in from Washington- "The National Association of Realtors (NAR) is working hard to ensure that the new Obama administration and Congress will have a "Troubled Asset Relief Program" initiative (TARP) or an additional economic stimulus package. This initiative will include provisions to stimulate home sales, prevent further foreclosures, and restore confidence in the housing market. NAR will continue its push in this direction for a comprehensive housing strategy. “The housing sector is at the core of the current economic crisis,” NAR President Charles McMillan said. “A renewed, revitalized and robust housing market is essential to generating commerce and helping families build wealth and stability. We are eager to see this happen and look forward to working with the Obama administration and Congress to quickly implement housing stimulus efforts.”

NAR is also working to ensure that any stimulus legislation reinstates the higher 2008 mortgage loan limits for FHA, Fannie Mae and Freddie Mac. These actions will have a significant impact on the housing market and will help protect home values,” McMillan said. NAR’s Housing Stimulus Plan includes both legislative and regulatory fixes. Its focus includes keeping mortgage interest rates low, boosting buyer confidence, and reducing the current foreclosure rate. It also asks that regulators be encouraged to help financial institutions resolve problems in the short sale process, make it easier for servicers to modify existing loans, remove unreasonable underwriting guidelines, and insist that credit reporting agencies correct errors promptly. “We must all work together to stimulate and unclog the housing and financial system. Low interest rates, tax credits and higher loan limits will be effective only if people can get a loan."

Some more good news just in- Fannie Mae won't evict renters. Tenants of foreclosed homes can stay if the house is up to code. Fannie Mae recently stated that it would allow qualified renters to sign month-to-month leases and stay on in homes it forecloses on (while it markets the home for sale), without requiring the tenant to pay a security deposit, or pass a credit check or payment history. The new National REO Rental Policy is intended to limit the disruption to the lives of renters when their landlord is foreclosed on, and "bring a measure of stability to communities impacted by high foreclosure rates," said Fannie Mae Chief Operating Officer Michael Williams in a statement.

Freddie Mac is reportedly developing a similar policy. Fannie Mae's program applies only to renters, not the owner of the property or their immediate family, and it requires that homes meet state laws and local code requirements for a rental property. All types of single family properties are eligible for the program, including 2-4 unit properties, condos, co-ops, single family detached homes, and manufactured homes. Properties with loans insured by FHA will require approval from the Department of Housing and Urban Development (HUD). Rents will be set at market rates by reviewing comparable rents, or using "other relevant indicators," Fannie Mae said. Properties will be managed through a real estate broker or a property management company, which will coordinate any necessary property repairs and respond to possible property safety issues. After a foreclosure is complete, renters will be offered a "Cash for Keys" incentive payment to vacate the property, or have the option of signing a new month-to-month lease with Fannie Mae. In late November, Fannie Mae and Freddie Mac suspended the process of evicting about 16,000 troubled borrowers or selling their homes while they implemented a streamlined loan modification program intended to prevent foreclosures.

All of this is good news for Tucson homeowners, because fewer foreclosures in Tucson real estate will hopefully translate to a prevention of further erosion of home prices. Please feel free to call me directly if you have any questions buying or selling a home in Tucson, or about the Tucson real estate market in general.

Written by Sarah Ley,
BSBA, ABR, CRS, CNHSA
Realtor with Long Realty Company
Direct: (520) 404-0544
http://www.sarahley.longrealty.com/
sley@longrealty.com

Real Estate Lessons learned the hard way

First of all, Happy New Year! Now that the holidays are over, I am happy to resume writing again, and I was just waiting for the right inspiration to find something to blog about.

I just read one of the best, most informative, well written articles about the housing bust that has led to the subsequent credit market meltdown of 2008. As we must acknowledge in a new year-- out with the old, and in with the new. Still, I believe there's quite a bit to learn from the mistakes that were made that caused the housing and financial markets to crumble. The article from the Wall Street Journal, entitled, "Small House, Big Loan, Spells Owner Trouble" by Michael M. Phillips brilliantly details the multiplying domino effect of the "house of cards" that was created when easy credit allowed strapped homeowners (and home buyers for that matter) to overextend themselves to their breaking points. The story happens to take place (of all places) on the Hopi Reservation in Avondale, Arizona.

Here's a well know recipe for failure:

-Take one woman's financial struggle, and necessity to fuel spending by using her home as a piggy bank
-add a greedy mortgage originator who makes money only by generating new loans,
-throw in a bank that funds the loan then packages it and sells it off to foreign investors as "high quality secure" mortgage backed securities,
-mix in a ratings agency that uses SEC guidelines to rate the securities as AAA so investors are willing to take a higher risk for what they perceive to be a quality investment vehicle
-above all, bake in an oven with little to no government regulation and a ticking time bomb adjustable rate mortgage that will surely throw the "unsuspecting" homeowner completely off the financial Richter scale once baked
-remove in 6-9 months, and watch the homeowner become homeless and the investors' money evaporate!

You'll have to read the article to know how it played out, but I do feel that this article shows how greed and corruption caused the demise of our deregulated financial system to literally fall like a house of cards. Blame whomever you want (one editorial actually had the audacity to blame television itself, namely HGTV for the housing bust). But the result is the same- we have only ourselves to blame. Accountability, now that's a novel word for a new year! Hopefully we will learn from our mistakes and 2009 will be a recovery year for the real estate market.

Happy New Year to you. Please call me directly if you have any questions about the Tucson real estate market, Tucson home sales, or Tucson real estate in general.

Written by Sarah Ley,
BSBA, ABR, CRS, CHNSA
Realtor with Long Realty Company
www.sarahley.longrealty.com
sley@longrealty.com
(520) 404-0544