Realtor.com names Phoenix as the #1 market in the nation for rising home prices. How can this be? Phoenix was one of the hardest hit metro areas in the housing slump. We were one of the first major metro areas to fall and now we are one of the first to rise.
According to data from Realtor.com’s: “First-Quarter Real Estate Trend Data Report”; the turnaround trend here in the Phoenix metro area has produced a 23.5% increase in the median home price from a year ago, bringing it to $179,000. The report analyzes data for 146 U.S. metros and includes single-family homes, condos, townhomes and co-ops.
The rise to the #1 market in the nation for rising home prices comes as no surprise to Realtors here in Metro Phoenix. Local Buyers Representatives have been experiencing Phoenix become a Seller’s market overnight. They have been scouring the Phoenix neighborhoods in the last couple of months in an effort to find homes for qualified buyers.
What happened to our inventory?
The glut of Foreclosure inventory has decreased dramatically due to the robust buying activity of investors, and the reluctance of our banks to release more foreclosures to the market at this time.
Sellers who did not have to sell immediately have been waiting until home prices picked up before putting their home on the market.
There are also too few new build homes available to meet demands. Builders are having difficulty finding skilled construction workers to keep up with demand.
As our Inventory of homes has decreased, the buyer’s demands for homes have not. It’s the age-old theory of supply vs. demand. Too few of anything that people want to buy causes the price to go up.
For homeowners who have been waiting to sell their homes, the wait is over. It’s now time to sell. It’s the spring selling season, the buyers are plentiful, and there are not enough homes on the market to meet demand.
Want another reason to expect your home to sell quickly?
How about buyers wanting to still get in on record low interest rates? The Federal Reserve policymakers wrapped up a two day meeting on Wednesday with an announcement that they intend to keep interest rates right where they are. In a statement, the Open Markets Committee said interest rates will likely need to remain at exceptionally low levels through late 2014.
Here’s more from Realtor.com’s report: “The Phoenix metro area has had a particularly notable shift in fortunes. In March 2011, it was No. 4 in the top 10 metros Realtor.com tracks for year-over-year median list-price declines.
RE/MAX issued a report that home prices in the 53 largest cities increased 5.8% in March from the same month last year, according to a report from real estate association RE/MAX. Phoenix is the fourth city in the list with an increase of 18.2%.
The homes sold in March had a median sales price of $184,525. It was the second-straight month prices rose higher than the year-ago period. Before February, home prices landed below year-ago levels for 18 consecutive months. But home sales steadily picked up over the last nine months.
In March, home sales climbed 1.5% from last year and jumped more than 25% from February, according to the report.
“With buyers starting to jump into this market, this year’s selling season is shaping up to be the strongest we’ve seen in years,” said Margaret Kelly, CEO of RE/MAX. “Although we don’t expect home prices to rise in every market at the same rate, the worst is definitely behind us, and a slow, steady recovery is taking hold.”
The homes sold in March spent an average 101 days on the market, down from 104 last year.
Inventory also dropped to a 5.3-month supply, a roughly 2% dip from February and the 21st consecutive monthly decline. The shadow inventory of foreclosed homes or those on the verge of repossession spans into the millions, and is anticipated to begin growing again as the robo-signing freeze thaws.
But RE/MAX anticipates housing to rebound through the selling season.
“Following these trends, the spring and summer months should experience increased activity. With falling inventory and many markets witnessing multiple offers with bidding competitions, prices are likely to continue to rise in many areas,” according to the report.
Source: John Prior, Housingwire
Bank of America wants to speed up the process of selling thousands of distressed homes by implementing changes to its short-sale procedures that will shorten decision times on short sale offers to 20 days, down from 45 days or longer.
Beginning Saturday, April 14 Bank of America will be ready to approve short sales in 20 days.
The move could spare delinquent homeowners from months of limbo while the bank considers offers from buyers. No longer will the buyer have to wait up to 6 months for the Bank to approve the deal.
The new task flow in Bank of America’s short-sale management platform, Equator, will enable short-sale specialists to conduct tasks like document collection, valuations and underwriting simultaneously.
Bank of America has been working with Equator, a real estate software company, to develop a program that allows short-sale negotiators to approve the process faster.
When the changes to Equator take effect Saturday, five documents will be required to process short-sales initiated with an offer:
• A purchase contract including buyer’s acknowledgment and disclosure.
• IRS Form 4506-T.
• Bank of America short-sale addendum.
• Bank of America third-party authorization form.
Offer documents and supporting documents for all short-sales submitted with an offer must be uploaded before Friday, April 13, or files may be declined.
Major lenders are looking to save millions on court costs, lawyer fees and property taxes by avoiding foreclosure. Short-Sales also speed the process of getting bad loans off bank books and gets the properties back on the market faster.
To further sweeten the deals, many lenders are waiving the deficiency on the mortgages, which would allow homeowners to sell the house for less than they owe without having to make up the difference to the bank.
Speak to a Short-Sale Expert Today: (480) 421-8116
The Phoenix market has done a complete turnaround and become a Seller’s Market. The inventory of homes for sale here in the valley is suddenly very low and as a result many sellers are receiving multiple offers on their homes. This is not bad news for the Sellers, however it is important for them to know how to choose the best offer.
Below is an article with great advice on how to make the best decision when receiving multiple offers on your home.
Have a plan for reviewing purchase offers so you don’t let the best slip through your fingers.
You’ve worked hard to get your home ready for sale and to price it properly. With any luck, offers will come quickly. You’ll need to review each carefully to determine its strengths and drawbacks and pick one to accept. Here’s a plan for evaluating offers.
1. Understand the process
All offers are negotiable, as your agent will tell you. When you receive an offer, you can accept it, reject it, or respond by asking that terms be modified, which is called making a counteroffer.
2. Set baselines
Decide in advance what terms are most important to you. For instance, if price is most important, you may need to be flexible on your closing date. Or if you want certainty that the transaction won’t fall apart because the buyer can’t get a mortgage, require a prequalified or cash buyer.
3. Create an offer review process
If you think your home will receive multiple offers, work with your agent to establish a time frame during which buyers must submit offers. That gives your agent time to market your home to as many potential buyers as possible, and you time to review all the offers you receive.
4. Don’t take offers personally
Selling your home can be emotional. But it’s simply a business transaction, and you should treat it that way. If your agent tells you a buyer complained that your kitchen is horribly outdated, justifying a lowball offer, don’t be offended. Consider it a sign the buyer is interested and understand that those comments are a negotiating tactic. Negotiate in kind.
5. Review every term
Carefully evaluate all the terms of each offer. Price is important, but so are other terms. Is the buyer asking for property or fixtures—such as appliances, furniture, or window treatments—to be included in the sale that you plan to take with you?
Is the amount of earnest money the buyer proposes to deposit toward the downpayment sufficient? The lower the earnest money, the less painful it will be for the buyer to forfeit those funds by walking away from the purchase if problems arise.
Have the buyers attached a pre-qualification or pre-approval letter, which means they’ve already been approved for financing? Or does the offer include a financing or other contingency? If so, the buyers can walk away from the deal if they can’t get a mortgage, and they’ll take their earnest money back, too. Are you comfortable with that uncertainty?
Is the buyer asking you to make concessions, like covering some closing costs? Are you willing, and can you afford to do that? Does the buyer’s proposed closing date mesh with your timeline?
With each factor, ask yourself: Is this a deal breaker, or can I compromise to achieve my ultimate goal of closing the sale?
6. Be creative
If you’ve received an unacceptable offer through your agent, ask questions to determine what’s most important to the buyer and see if you can meet that need. You may learn the buyer has to move quickly. That may allow you to stand firm on price but offer to close quickly. The key to successfully negotiating the sale is to remain flexible.