Another Mortgage Lender Bites the Dust?

It seems that the only thing we hear in real estate news right now is how mortgage lenders are falling apart as delinquency rates rise in borrowers. American Home Mortgage shares dropped 90% on Tuesday and it's feared that bankruptcy is not out of the question as the disrupted credit market affects another prime loan lender. The company, which recently commanded 2.5% of the US mortgage market, said Tuesday that it's "out of cash" as many of it's financial backers refuse to let the company borrow more money, and some are asking for their money back. Shares of several mortgage lenders fell dramatically today after the announcement by AHM, and a large number of sub prime lenders continue to "disappear" as more borrowers default on home loans.

Last week American Home Mortgage laid off more then 400 employees, and has currently suspended funding loans. As of Tuesday the company expected to be was unable to finance more then $450 million in mortgages for home buyers. American Home Mortgage is known for funding loans to those with less then perfect credit and little of no income documentation. They specialize in prime and near prime loans, as well as adjustable rate mortgages, which are now problematic for some as interest rates rise.

Yes, it's a crazy world out there right now! The Tucson Real Estate market suffers from the same mortgage woes, but buyers need to be ready to take advantage of the opportunities that do lie in the market. If you're in a position to buy in the Tucson Home Market and are already qualified for a loan, there are currently 8600 active listings to choose from. Let the current market work for your benefit!

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Arizona Foreclosure Rates Confusing at Best

The new statistics are out and Arizona's foreclosure rate continues to remain high as more homeowners default on loans. According to the latest report by RealtyTrac, Arizona foreclosures have increased 74% from the first six months of 2007. Compare that number to a 58% increase in foreclosures for the rest of the nation and Arizona ranks in the top ten highest foreclosure rates. In Arizona alone, 27,515 foreclosure filings were reported for the first six months of 2007, amounting to 1 filing in every 92 homes.

Still foreclosure numbers for Tucson and it's surrounding communities don't seem quite as terrifying once the numbers are broken down. In May the Tucson Citizen reported that Pima County had 1,427 foreclosures in the first quarter of 2007, which is a 19% increase from first quarter 2006 foreclosures. That percentage is actually lower then the first quarter foreclosure rate in Tucson for 2005 to 2006, which was 27%. Although the Tucson foreclosure rate is still high, the upside is there has been a significant decline over the previous year.

What's fueling this surge in foreclosures? Seems that "creative lending" or sub prime loans are the biggest contributors to the significant rise. Homeowners that financed or refinanced with sub prime loans now find themselves unable to make payments as they cannot afford rising interest rate. Tucson ranks 19th among 420 US metro areas for sub prime foreclosure rates. Lenders are now becoming much stricter with their underwriting practices, so while it may be harder for an individual to initially get a loan, there is less likelihood that they will default.

Where does this leave Tucson Real Estate? With a June inventory of 8,665 actives listings and fewer buyers qualifying for loans, inventory will remain high. For sellers this means pricing their home correctly up front and realizing that negotiation is a must to close a deal. For buyers, the excessive inventory provides lots of choices and the power to find the deal and home that's best for them.

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Tucson's Montana Avenue Satisfies Any Sweet Tooth

As you will soon see from all my restaurant reviews, I love to eat! Since every one's perception of a dining experience is different, I'm going to tell you about mine, you give it a try and then feel free to offer feedback.
A small group of friends and I recently visited one of the many Fox owned restaurant's, Montana Avenue. Located on Grant Road, it's convenient central location was perfect as we were all going to be in the area anyway, so rush hour traffic wasn't a significant problem. It's got a hip, urban vibe to it, and the dress code is "Tucson casual", which means pretty much anything goes. Prices range from $15-$30 per entree, but there's a great variety of appetizers so you'll likely spend more. The menu offers "regional American cooking" and a terrific wine list. The owner, Sam Fox, has several great restaurants in Tucson and Phoenix that offer a wide range of delicacies. Most are upscale (it's all relative I guess) and draw a clientele of young business professionals. The bar area in many of the restaurants is a focal point, and large groups tend to congregate here for the "after work cocktail". Fox Restaurants has a great reputation for wonderful food and service. One thing I must point out is that you need to make a reservation! Luckily I did, because when we arrived a 6:15 the dining room was already full.
Unlike my first visit here, on this occasion our service was spotty. I noticed that the bartender was also our food server, which led me to believe that the restaurant was short staffed. Our server was very friendly and knowledgeable, and he maintained a calm disposition even though I could see he was overwhelmed.
Aahhh....now for the food! I felt like trying a healthy entree so I could later indulge in desert. I ordered the special, which was a broiled Mahi served on a bed of cranberry beans (flavored with bacon) , sauteed tomatoes and arugula. Very pretty presentation, but my Mahi was extremely overcooked. A friend ordered the Shrimp Risotto, which was wonderful, as was the Grilled Ahi and Flank Steak. Another friend ordered the Pork, which was extremely undercooked.
I must say that Montana Avenue has, overall, the best deserts in town. My favorite is the Bread Pudding, which is incredible (it really gives the bread pudding at Vivace a run for its money). Two other guests decided on the warm Cinnamon Sugar Donut with vanilla custard dipping sauce. Numerous other deserts are available and all are very good.
Although the meal was not a complete success, I'm sure we will go back for another try. Montana Avenue has a great atmosphere, and as a general rule the Sam Fox restaurants provide exceptional food and service. If all else is a flop, at least I have the bread pudding!

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Mortgage Defaults on the Rise for Prime Loan Borrowers as Well

It's not surprising news; mortgage defaults across the nation continue to rise as more people are failing to make mortgage payments. What is surprising is that much of these delinquencies are coming from homeowners that have strong credit and used prime loans to finance their homes. Countrywide Financial Corp. reported that it's second quarter profit shrank by nearly a third as soft home prices led to rising mortgage delinquencies and defaults. Higher unemployment and divorce rates, and slower market sales are being blamed for the increase of delinquencies from prime loan borrowers. Most of these delinquencies are being seen in specific types of prime equity home loans - those requiring little or no documentation, those with a high loan-to-value ratio, or piggyback loans, a second mortgage loan taken out in addition to the primary in order to avoid paying PMI. Unfortunalty many homeowners with great credit are stuck with not a lot of alternatives.

The increase in mortgage defaults and delinquencies in Tucson's Real Estate market are mostly due to subprime lending. During the Arizona Real Estate Boom of 2005 and 2006, many first time home buyers obtained loans from subprime lenders. Now many of these homeowners aren't able to afford their mortgage payments with interest rates rising, but they aren't able to sell their home they can no longer afford in todays slower market. This is leading to higher foreclosure rates and more active listings in the Tucson real estate market.

As usual, the Tucson's current real estate market is great for buyers that are loan qualified and ready to go. The high home inventory is a buyers dream as they have their choice of numerous properties and more time to decide what's best for them, rather then making a split decision they aren't prepared for as in prior years.

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Tucson Real Estate Sales Strongest in NW

As the Tucson Real Estate market continues to stabilize after the volatile conditions of 2004-2005, Northwest Tucson appears to be drawing the most real estate activity. According to Tucson Associations of Realtors June 2007 statistics, Northwest Tucson had nearly a quarter of all listings sold , about 1,779 listings. Of the 7,417 active home listings for June, approximately 27% were located in Northwest Tucson, with an average price of $347,165. Also high is Northwest Tucson's number of Days on Market at 73, which was 9 days above the city's average of 64 days.

What's contributing to Northwest Tucson's high numbers? Northwest Tucson, including the towns of Oro Valley and Marana, continues to be one of the top "hot spots". These areas experienced rapid growth from 2003 thru 2005, and many of the homeowners that purchased during this time are now selling with the hope of benefiting from the vast appreciation that occurred. As Oro Valley and Marana continue to grow, new home builders continue to offer unbeatable incentives to draw tempted buyers into the area. And, many of Tucson's prime Retirement Communities are located in Northwest Tucson, contributing to the large influx of new residents each year.

There are still plenty of homes for sale and plenty of deals to be had in Northwest Tucson. As the area continues to add more restaurants, shopping and other amenities, more people will consider choosing Northwest Tucson as their new home.

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Tucson Real Estate Numbers at a Glance

Tucson Average Sale Price 2005 thru June 2007

Just a brief summary - The Tucson Association of Realtors released new stats on July 13th and the numbers look promising. The Tucson Real Estate market remains stable as buyers and sellers continue to work together to close deals. Although the number of homes sold is down over 19% from June 2006, the average sales price increased over 9% to $298,477. Inventory was down as more homes were under contract and there were fewer active or new listings.

Still, the days DOM (Days on Market) increased again to 64 days for June 2007, a 39% increase from June 2006 . This means Sellers will need to negotiating in order to sell, and buyers should be prepared to jump on every opportunity. New home construction has slowed significantly in the last two years so builders are offering some fantastic incentives. It's a great time to be a buyers that's ready, willing and able!

For more Tucson Real Estate sales stats visit the Tucson Association of REALTORS

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For Tucson Area Wine Lovers

I'm about to make one of my personal recommendations, so I hope all of you like the vino! For those of you that truly enjoy savoring a nice glass of wine, there's a new wine shop you should try called Wine Brothers. The concept of a wine tasting bar in Tucson was relatively new when Wine Brothers opened in early 2007. Though there were a few wine retail stores that also offered tastings at the time, I find that the relaxed atmosphere, reasonable prices and casual Tuscan theme at Wine Brothers is unmatched. Besides having an extensive selection of great wines for sale, wine connoisseurs have several different options for enjoying their favorites on the premises . If sampling a variety of wines is your style, head up to the tasting bar and check out the daily selection that's being offered. If you would rather just relax with a glass of your favorite vino, make your purchase and then make yourself comfortable in one of the cozy leather chairs located in the lounge area. Can't enjoy a good glass of wine without something to munch on? No problem! Bring in whatever you're craving and have a seat at one of the many bistro tables in the cafe area. There's even a private room that can reserved for group tastings. If you'd like to make an evening out of it, make sure to stop by on Saturday evenings when there's live entertainment.
Another new wine cafe and lounge, Armitage, will be opening soon at La Encantada shopping center. A brother to the Armitage wine lounge in Phoenix, I'd expect to find the same premium wines and Old World ambiance as in the Scottsdale location. Once I've made my visit I'll post on it and let you know!

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