Tucson real estate sales statistics for September

Tucson's real estate sales stats for September were just released and just when you thought it couldn't get any worse it did. The economy is hittin the real estate market hard right now and it's apparent in our current numbers. The average and median sales price in Tucson have both dropped significantly as well as pending sales and homes sales volume. Both active and new listings saw slight increases as well as number of units sold.



- Tucson saw a pretty significant dip in our average sale's price again in September; the average price dropped to $217,397, a 8.85% decrease from August's average of $238,504, and a 20.19% decrease from September 2007 ($272,396).

Tucson average sales price for September

- Tucson's median sales price for September '08 was $180,500, a 2.43% decrease from August's median price of $185,000, and a 16.05% decrease from September 2007's median price of $215,000.

- There were 836 Pending contracts in September 2008, a decrease of 4.78% from the number of Pending's in August (878). It's also a 15.47% decrease from the number of Pending contracts in Sept 2007 (989).

- The average days on market decreased by one putting us at 82 for September 2008, compared to 77 DOM in August and 72 DOM in Sept 2007.

Tucson average days on market for September

- Tucson had 7,858 Active listings in September, a 1.22% increase from 7,763 in August 2008, and a 14.49% decrease from Sept 2007 (9,190).

- Tucson saw 2,039 New listings in Sept 2008, a 4.46% increase from August 2008 (1,952), but a 18.34% decrease from Sept 2007 (2,497).

- The number of units sold in September 2008 (934) increased by 3.43% from August's number of 903. It's also a 20.67% increase from Sept 2007 (774).

As the economy continues to take a dive the Tucson real estate market is following. As usual it can be said that if you are looking to buy a property there's plenty of inventory, so that's a positive note. The big problem is that fewer people can qualify for a loan. I spoke with a few lender friends of mine and all said that those that have good credit and income and a nice down payment shouldn't have a problem getting a loan. Still that can change in an instant. It's going to be interesting to see how Tucson's market is impacted by the nosedive the stock market has taken. A large number of Tucson buyers are seniors investing in retirement homes or individuals investing in second homes. After the week we've had there's a good chance that many retirees and investors have lost a huge portion of their savings and aren't in a position to buy. As we move into our busy season we'll continue to keep an eye and sales activity and hope for some improvement.

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The mortgage meltdown simplified....

Courtesy of mymoneyblog.com

So simple a five year old can understand....too bad some buyers and lenders didn't.

Just a lite example of how the country got into the big mess we're in now.....


Check out this entertaining slide show to see how simple it once was to get a home loan

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Builder sales continue to drop nationwide

New construction housing starts were down again nationwide during the month of August, at their lowest point since 1991.

The Commerce Department reported that new home starts were down 6.2% from July, and down 33% from the previous year. New homes sales have slowed quite a bit in the Tucson area as well. When comparing local new homes sales to the previous year, inventory homes aren't selling like they have in the past. Within the last six months only 65 new construction "spec" homes have sold in NW Tucson, compared to 248 "spec" homes that sold during the same period last year. A friend of mine who works as a Pulte sales rep told me that she has not sold a home all summer. She's usually very upbeat and positive but I can tell she's really concerned about the market and where it's heading. The builder continues to lower their home prices, hoping to draw in more buyers. Unfortunately the buyers just aren't coming in. As we move into the busy season for Tucson real estate, everyone's hoping that the low prices and high inventory will get our housing market moving.

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Year of the grasshopper?

I've noticed a real increase in grasshopper sightings this year; not something we see too often in Arizona. If you step out at the right time of day you'll see them all over the sidewalks and streets. Although grasshoppers may be interesting to watch they seem to be causing real problems for some farming communities.

The Tucson Community Supported Agriculture reported that they are canceling their Fall session Thursday pick ups due to increased grasshopper damage. Crops were devastated from grasshoppers at "biblical proportions" according to one local farmer. So what's causing the increase in these herbivorous insects? Apparently it's a seven year cycle; grasshoppers multiply until the seven year crescendo and then start a new cycle. It looks like this year they're at their peak; after this season we probably won't see them again for awhile. Although local farmers will be relieved some of us will miss the entertainment!

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Tucson real estate sales statistics for August (Warning, you might want to grab your box of Kleenex now)

Ouch!!! The Tucson real estate sales statistics for August were just released and they don't look good! Looks like average sales price, median sales price, pending contracts and homes sale units were all down while number of new listings were up. Not a good mix....


- Tucson saw a pretty significant dip in our average sale's price in August; the average price dropped to $238,504, a 6.42% decrease from July's average of $254,854, and a 12.94% decrease from August 2007 ($273,815).

Tucson average sales price for August

- Tucson's median sales price for August '08 was $185,000, a .7.45% decrease from July's median price of $199,900, and a 16.25% decrease from August 2007's median price of $220,900.

- There were 878 Pending contracts in August 2008, a decrease of 8.54% from the number of Pending's in July (960). It's also a 14.26% decrease from the number of Pending contracts in August 2007 (1,024).

- The average days on market decreased by one putting us at 77 for August 2008, compared to 78 DOM in July and 68 DOM in August 2007.

Tucson average days on market for August

- Tucson had 7,763 Active listings in August, a 1.43% decrease from 7,876 in July 2008, and a 13.30% decrease from August 2007 (8,954).

- Tucson saw 1,952 New listings in August 2008, a 16.26% increase from July 2008 (1,679), but a 16.47% decrease from August 2007 (2,337).

- The number of units sold in August 2008 (903) decreased by 4.44% from July's number of 945. It's a 17.31% decrease from August 2007 (1,092).

Wow, what to say..... As I've said it's going to get worse before it gets better. There's a few other real estate professionals that agree with me when we're in private, but otherwise it's really kind of an unspoken subject. Don't want to appear too negative! Unfortunately we've got to be realistic. The economy is a mess, there's a lot of people that cannot obtain home financing, and I think to some degree the nation is at a standstill until this election is over. Home prices will not increase until we can rid our market of the foreclosures and excess resale inventory. Foreclosures will likely increase over the next few months so we can count on prices remaining low for some time. On the up side if you don't have a home to sell, you qualify for a loan and you have cash available for a down payment, there's some great inventory out here!

Tucson real etstate sales statistics for August

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Looking to rent? Tucson is the place for you!

Arizona home prices may be dragging but we have a great rental market!

Arizona and Florida both top a list of metro areas with the biggest rent drops. As housing prices continue to drop more homeowners are renting because they can't sell. More competition means desperation and lower prices. Until we see a decrease in inventory prices will continue to remain low.

The weak economy is also impacting rentals. As many Americans worry about what their future holds, renting might be a better option for those that don't want to be tied down financially.

Tucson has seen a annual rent drop of 2.4% and a vacancy rate of 7%.

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Arizona foreclosure filings for July

While the nation saw an average increase of eight percent in foreclosure filings for July, Arizona saw only a three percent increase, putting our state at number four in filings for the month. Florida actually bumped us out of the way to steal the number three position with an increase of fourteen percent.

Though Arizona appears to be slipping back on the list, we've seen a 127% increase in foreclosure filings over July 2007. One in every 195 properties received a foreclosure filing in July. When looking at foreclosures in metro areas, Phoenix ranked at number ten. According to Realtytrac, "bank repossessions are the fastest growing segment of foreclosure activity in July". Currently there are about 80 real estate owned properties on the market in Tucson.

I think we've got a ways to go before we see these numbers go down. There's still a large number of homeowners that have maxed our all that glorious equity they built up so quickly. As issues continue with the economy we should expect to see higher foreclosure numbers for the next few months. Once we eliminate more of the distressed properties from our inventory we'll see home prices creep back up along with unit sales.

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Autumn approaches slowly in Tucson

Though it's sometimes hard to distinguish seasons in Tucson, anyone who's lived here for awhile can tell that Fall is making it's way into the Old Pueblo. We see the normal signs like shorter days and cooler nights, lots of yard sales and kids returning to school, but there are several other signs that make me realize summer is almost over.

The monsoon is still hanging on in Tucson, filling the sky with those fluffy grey and white clouds that make you think of cool autumn breezes, brightly colored leaves and pumpkin patches. I've seen Halloween costumes and some Christmas decorations for sale at various retails stores. Some of these items started popping up on store shelves and QVC in July, but as we get closer to October they're becoming more abundant. Soon we'll see the Halloween specialty shops popping up in vacated retail buildings across the city.

The cooler overnight temperatures that Tucson is seeing makes it easier to get out and exercise in the morning. While out on my runs I've noticed packs of bicyclists making their rounds early in the day. September is when the really serious cyclists start full training for the El Tour de Tucson bike race which takes place in November. It's rare I see a single cyclist; most are packs of five or more and are dressed in full uniforms that proudly display their sponsors.

Each Fall in late September and early October I see a lot of my "snow bird" neighbors slowly returning to their homes for winter hiatus. Most seasonal residents make their way back here in November or December when the rest of the country begins bearing the brunt of ol' man winter. A significant percentage of home sales in Tucson are out-of-state residents buying vacation homes they can visit in the winter. With average temperatures in the 60's and 70's you really can't find a better place to live when it's snowing everywhere else. I personally am not seeing as many vacation home clients as I have in the past and I think the economy is playing a part in that. People just don't have as much money to spend on the extras they once did.

As the days continue to grow shorter and the temperatures cooler, Tucsonans still need to look at the calendar to realize that we're approaching Fall. Being from the Midwest, it was easy to see autumn approaching. I miss the seasonal changes that made being a kid fun. I remember walking home from school when the autumn wind was brisk and blowing the leaves from the brightly colored trees. We don't see those color changes in Tucson; our cactus are green all year long. I miss my mother forcing me to eat a reasonably healthy meal before we headed out for trick or treating. Most of my Halloweens I needed to wear a jacket over my costume because it was so cold. When Tucson kids are suiting up as their favorite Batman or Harry Potter character they needs to dress in layers as temperatures could still be in the 90's when they head out.

Tucson has some of the best weather in the country so we take what we can get when it comes to seasons. Once we're done with 90 degree days and monsoon rains we'll be happy campers. Then it's seven months until we need to turn on the air coniditioners again!

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Tucson's a great place if you're not flying through TIA

A big problem that myself and a lot of others have with Tucson is how difficult it is to travel to other destinations from our airport. My husband travels all week long so I'm very experienced with most Tucson airlines. It seems like every time he or I fly we encounter some type of problem that makes our travel day a nightmare. Depending on where you're going, there's a good chance you'll be flying all day and faced with several layovers to get to your destination. TIA has seen a 41% decrease in flights this year and it's impacted the travel plans and pocketbooks of almost every Tucson traveler.

Currently there's only ten airlines that offer nonstop flights from Tucson, with about 18 non stop destinations. These airlines include American, US Airways, Delta and Southwest. If you're flying directly to any of their major hubs you're in great shape, but not everyone is making Dallas, Phoenix, Atlanta or Albuquerque their final destination. If you're departing from Tucson, you can bet you'll have a stop over in one of those four cities. ExpressJet was the eleventh airline that provided non stop service to and from Tucson but this service will be discontinued September 2 when they'll cease flying here and in the rest of the country.

(Warning...through much of this blog I'll be venting my feelings about US Airways so I apologize in advance. Since this is a major airline in Arizona I feel the need to warn travelers)

Besides the lack of non stop flights to and from Tucson, the cost to travel from our local airport can be more expensive then departing from Phoenix's hub, Sky Harbor. A large number of fliers actually drive/shuttle to Phoenix and fly direct because there are more non stop options and ticket prices can actually be cheaper. When flying with US Airways, flights directly from Phoenix are often less expensive then flying from Tucson and connecting in Phoenix. I've seen ticket prices cost as much as $300 more when departing from Tucson instead of Phoenix.

One huge problem for US Airways is that the majority of their flights run late, which throws a wrench into any travelers plans. I can't tell you how many times I've been sitting on the first leg of my trip, a US Airways flight to Phoenix, excitedly planning out my vacation schedule. There I sit, and sit and sit... when finally the airline announces that our flight will be delayed. It's not uncommon for these flights to be delayed by at least an hour, which is really frustrating when the actual flight to Phoenix is only 20 minutes long, and the drive time to Phoenix is about one hour. There's a lot of people who feel it's just more practical to drive directly to Sky Harbor to ensure they're going to catch their flight. I'm now one of those people. I'd rather spend a little time and money driving to Phoenix then risk missing my connection because of flight delays.

US Airways isn't the only airline that has difficulties, they just seem to be the most consistent with their issues. Every airline that comes through the Tucson International Airport has their good days and bad. American sees weather and traffic congestion delays in Dallas all the time, but being delayed in Dallas doesn't bother me as much as being stuck in Phoenix. My word of advice is if you're flying US Airways through Phoenix, have a backup plan and a carry on!

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Housing starts continue to drop; Tucson home builders

The Commerce Department reported Tuesday that housing starts nationally plummeted almost 11% in July to it's lowest pace in 17 years. Construction of single-family homes in July fell 2.9% to a pace of 641,000, lowest since January 1991. Many home builders in Tucson are struggling as they continue to drop home prices that are being impacted by high resale inventory and surging foreclosures and short sales.

In Oro Valley there are quite a few home builders that are trying desperately to sell off their remaining home sites, spec homes and models. All of these builders have dropped their prices significantly since the communities first opened around 2005. One of Tucson's biggest builders, Pulte, has dropped the base prices drastically in their high end development of Sienna; prices are about $100K less then they were in 2006. Homes that once started at $642K are now starting at $542K, and some of their spec homes have recently old for almost $200K less then the original 2006 prices. This particular community is not yet built out and is already seeing a number of short sales, which are impacting surrounding property values.

Nicholas homes is another builder that's really struggling in Oro Valley. The Stonefield community still has almost half their home sites available and their base prices have dropped about 17% since December 2005. Home prices that once started in the mid $300K's are now starting around $276K. I drove through this community last week and noticed how run down and unkempt the model's exteriors looked. Weeds and landscape were out of control which made the homes looked like they'd been abandoned. One of the models is currently on the market for $449K. Considering the base price of this home is now $339K, it better have some incredible upgrades to warrant this price.

High fuel prices are impacting home builders located outside Tucson as buyers avoid developments that require a long drive time. Several Tucson builders are lowering prices to "lure" buyers that would might otherwise avoid their communities due to distance from amenities. New construction home sites as well as resale homes continue to sit in Red Rock and Vail because buyers don't want to drive so far outside the city.

Until Tucson home builders can sell off some of the existing inventory their "giving away" our resale market will continue to remain sluggish. Once we can eliminate the builder spec inventory that's available buyers should begin focusing on resale homes; this should help reduce our resale inventory and help to stabilize the market.

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Tucson real estate sales stats for July

Tucson real estate sale statistics for July are out and it looks like the market may be on it's way to slowly stabilizing. During July Tucson saw fewer new listings, while the average sales price dipped by just 1%, and median home price remained literally unchanged from the previous month. Could this be the light at the end of the tunnel?

- Tucson saw a slight dip in our average sale's price in July; the average price dropped to $254,854, a 1.01% decrease from June's average of $257,449, and a 4.84% decrease from July 2007 ($267,808).


Tucson average sales price for July

- Tucson's median sales price for July '08 was $199,900, a .05% decrease from June's median price of $200,000, but a 7.88% decrease from July 2007's median price of $217,000.

- There were 960 Pending contracts in July 2008, a increase of almost 1% over the number of Pending's in June (951). It's also a 45.98% decrease over the number of Pending contracts in June 2007 (1,777).

- The average days on market remained unchanged at 78 in July 2008, but still a 20% increase from June '07 (65) .


Tucson average days on market for July

- Tucson had 7,876 Active listings in July, a 3.24% decrease from 8,140 in June 2008, and a 9.39% decrease from July 2007 (8,692).

- Tucson saw 1,679 New listings in July 2008, a 19.86% decrease from June 2008 (2,095) , and a 39.30% decrease from July 2007 (2,766).

- The number of units sold in July 2008 (945) decreased by 8.61% from June's number of 1034. It's a 20.05% decrease from July 2007 (1,182).

July is typically a slower month for real estate in Tucson. The temperatures are hot and the summer monsoons make it very humid. We see very few out of state visitors during our summer months so retirees and second home buyers aren't taking advantage of the great inventory that's available. Those that are buying are generally job relocations trying to squeeze a move in the school year starts.

I'm really hoping these numbers are a reflection of the stabilization that Tucson's housing market needs, but there's no way to tell until we see real estate stats for the next few months. If we continue to see fewer new listings and more unit sales, we'll be on the right track to reducing our Days of Inventory, which was at about 258 days as of July. Though this number seems relatively high, it's dropped by about 50% since January '08, meaning we might be headed in right direction.

Get all the latest Tucson real estate numbers at the TAR Monthly Statistical Digest

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Million dollar bank owned homes popping up everywhere

Photo courtesy to Tucson MLS

Everyday I'm amazed when I see another "bank owned" property come on the market. It's not the fact that so many homes are bank owned, but that quite a few of them are million dollar custom homes.


Just check out this one that's located in The Gallery at Dove Mountain. In Tucson there's currently three short sales, one bank owned and one foreclosure property that are listed with prices over one million dollars.

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And we thought Tucson's housing market was bad...

Photo courtesy of detnews.com

You know the real estate market is tough when a home is priced at $1 and it still takes nineteen days to find a buyer....

This "quaint" little home in Detroit sold for a big fat dollar after selling for $65,000 in 2006. It sounds like the house was pretty much a scrap heap by the time it went on the market, so the new homeowners really have their work cut out for them!

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Tucson residents looking for carpool buddies

A number of Tucson residents commute to Phoenix for work on a daily basis and the costs involved are breaking the bank for some. With fuel prices still high there's been a lot of talk about car pooling as a way to save money.

Even for those residents that work in the Tucson area, the commute to and from their jobs can be quite a drive. Some of Tucson's least expensive housing is located in rural areas that require long distance driving to get to local amenities, so driving to work just adds on the financial burden. I found a couple of great sites for Tucsonans looking to carpool locally or outside the city, and from what I've seen there's a lot of Tucson residents that are looking to share commuting expenses. Unfortunately Tucson doesn't utilize carpool lanes so the only advantage is saving money on gas!

Carpoolworld.com

ERideshare.com

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One third of homeowners in negative equity

Zillow released a report today reporting at least one third of new home owners that bought in the last five years owe more then their homes are worth. Nearly one in foue home sold last year were sold at a loss. Not surprising news considering so many people bought homes when the market was high while financing 90 to 100 percent of the homes cost.


California is being hit hardest, with the number of homeowners whose mortgage debts exceeded the values of their properties topping 90 percent in some areas. During Q2 2008 foreclosure activity in California increased 19 percent over Q1 2008. About one in every 65 households filed foreclosure during this period.

Arizona posted the nation's third highest foreclosure filing with a 36 percent increase in filings over Q1 2008 and close to four times the number reported for Q2 2007. This amounts to about one in every 70 Arizona homes filing foreclosure. The Phoenix metro area reported one in every 51 homes received a foreclosure filing during this period.

Who's to blame? Excited home buyers who didn't read all the fine print or exaggerated their income on loan applications, or the lenders themselves that approved any and everyone for homes they really couldn't afford? I personally don't think we can point the finger at any one cause for this fiasco. All we can say is that foreclosure filings will likely increase and sales prices will drop through the rest of the year. Lending standards are getting tighter so fewer buyers can obtain loans without large down payments, which isn't necessarily a bad thing. If we hadn't seen so much creative financing being used in the past few years this problem wouldn't be as extreme as it is now.

One Third of New Owners Owe More Than House Is Worth

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Tough market creates struggles for real estate agents too

The sluggish housing market is wreaking havoc on everyone's lives, including real estate agents. It's not just their professional lives that are being affected with real estate downturn; many are struggling financially and are at risk of losing their own homes.

The real estate slow down is difficult for everyone right now. Buyers struggle for a number of reasons; many can't qualify for the loans they once could, so fewer are jumping into the game. Others need to sell their own home first; higher housing inventory/competition and fewer qualified buyers make selling a nearly impossible feat right now. But the buyers and sellers aren't the only ones being affected by the declining market. A large number of real estate agents are struggling financially as they see their client base and income shrink. I know several that have taken on second jobs to pay their bills, and a few that have quit the business all together to search for a more stable job.

Besides seeing a decline in business and income, many real estate professionals are facing foreclosure of their own homes. The housing boom created a frenzy and some real estate agents decided it was time to buy before prices escalated too high. Some bought investment properties, others just upgraded to bigger homes while loans were affordable and easy to get. The tide has turned and many of these same agents are trying desperately to sell what they can no longer afford. I can't tell you how many foreclosures and short sale listings I see that are "agent owned". I know of one home that was purchased by an agent during late 2005; they paid $260K more then what they're currently selling it for now through short sale. I hate to criticize but the home was never worth what they paid (IMHO) so I don't have a lot of sympathy for their situation. Everybody knows what goes up must come down, and prices were bound drop sooner or later.

This morning's USA Today features a story about how the sluggish housing market is affecting real estate agents nationwide. The article presents some interesting statistics about just how many real estate agents are fleeing the industry.

- The number of real estate agents fell nearly 25,000 from December 2006 to Dec 2007, compared with a growth of 12,500 from Dec 2005 to Dec 2006.

- After hitting a membership high of 1.4 million in 2006, the National Association of Realtors reported only 1.26 members as of July 2008.

- Payroll employment of brokers has dropped from a peak of about 380,000 jobs in spring 2006 to 340,000 jobs currently, Zandi says. Many more non-payroll jobs have been lost. And more losses are coming as home sales sink back to levels last seen in the early 1990s.

It's always interesting to read the comments that viewers make at the end of these articles. Most feel real estate agents are blood suckers that created all these problems and that those now struggling are getting what they deserve. Why all the hate?! Not all real estate agents are vultures, waiting to feed on the naive buyers and sellers of the world. Being a real estate agent is a tough job if your do it correctly, and this rough market is a learning experience that can make or break you. Those lucky enough to survive are learning the tricks of the trade that can make them strong and successful in any type of market or career. Just hold on tight because I think it's going to be a long and bumpy ride!

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Property taxes one of the biggest differences between Arizona and Midwest homes

I was out of town for several days last week and didn't get the chance to blog, but on my trip I enjoyed one of my favorite pastimes; looking at model homes. It's always interesting to check out different parts of the country and see what appeals to local home buyers. Since many Tucson residents have relocated from different parts of the word, I like to note the differences I come across whenever I hit the road. My latest travels took me to the Midwest where I found some very distinct differences between homes in St Louis and Tucson.

There were a number of differences that jumped out at me when I looked at homes in St Louis. Of course the landscape is different; St Louis sees lush green foliage and Tucson is home to drought tolerant plant life (which is still be green and colorful through most of the year). All the yards in Missouri have green grass while most Tucson yards consist mainly of gravel (water conservation!). The majority of St. Louis homes don't have walls surrounding the property; the yards are open to anyone walking by. Even homes with pools don't have the high block walls you see surrounding most Tucson properties. Many only have low lying wrought iron "fences", while others use trees and bushes to create privacy walls.

The homes themselves share a lot of similarities and differences. St Louis homes use various weather durable vinyl/concrete sidings that protect against rain and snow. Tucson homes use stucco, a breathable sand/cement/water combination that sprays on wet and forms a hard shell when dry. Homes in Missouri have asphalt shingle roofs, which generally last about 20 years, while most Arizona homes have concrete tile roofs that can last up to 50 years. Block/stone accents are popular choices with homeowners in both areas, while brick is seen mainly in the Midwest. Interiors aren't too different; most homes in the Midwest have primarily wood flooring with some tile and carpet, while Arizona homes have mostly tile and some carpet. Wood flooring is becoming more popular in Arizona, and we see many homeowners replacing carpet with Pergo laminate wood flooring.

One of the big differences I found is the cost of living in Missouri versus Arizona. Missouri's expensive! Taxes are quite a bit higher there, with income tax at 6% and sales tax at 4.3%. In Arizona income is taxed in different brackets, with the highest being 4.5%. Sales tax runs a little higher at about 6.3%. Property tax is a confusing calculation but the assessment rate is 19% in Missouri, while in Arizona it's only 10%. Property taxes for a $750K home in St Louis run almost $10,000 a year, while in Tucson it's less then half that. That makes a big difference in a monthly mortgage payment! I've had many clients that relocated to Tucson and were thrilled at the lower cost of living.

I also noticed that St. Louis home builders aren't negotiating like Tucson builders are. Local Arizona builders have been offering incentives of up to $100K of the price of inventory homes, while St. Louis builders aren't offering much of anything. From what I've found St. Louis real estate is seeing their normal summer slowdown with lower unit sales and higher days on market. Home prices remain stable overall, but price declines are being seen in areas that were overbuilt or have suffered concentrated industry downturns. Tucson home prices are seeing a slight increase but remain much lower then they've been in previous years. We still see a high number of foreclosures due to sub prime issues and lower home values, so there are some great deals to be found for home buyers.

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Walk away companies taking advantage of distressed homeowners

I'm a little late getting back to my discussion of "walk away"companies but I thought the topic was interesting so I wanted to least direct readers to the article. Time magazine recently had a great article about companies that offer to help distressed homeowners "walk away" from cumbersome mortgages they can't afford while also avoiding foreclosure. There are different variations of these types of companies; some are genuinely helpful while others are just out to make a buck.


Walking Away From Your Mortgage

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Tucson's rent is the cheapest in the West

Tucson has the cheapest rent in the West according to a quarterly study conducted by RealFacts Inc.

Of the 19 metro areas that were surveyed, the cost to rent an apartment in Tucson was cheapest at $665, down .1% from the same period of the previous quarter. Phoenix rent was $812, while San Jose ranked the highest at $1689.

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Hitting too close to home

Tucson recently ranked number three on the latest Realtytrac list of foreclosure filings. This dilemma is hitting all types of neighborhoods and price ranges. In my own neighborhood there's now both a foreclosure listing as well as a short sale.

I would never have expected foreclosures in my own neighborhood, but I'm not surprised by anything anymore. One of the above mentioned homes was bought as an investment while the other was bought when the market was at its peak in late 2005. Both are in less then desirable locations as they back up to a now two lane/soon to be four lane roadway which produces quite a bit of road noise. Both have been sitting on the market a long time and have not gotten offers for this reason (IMHO). Both are now priced extremely low which will inevitably affect our neighborhood's home values. Now we're seeing the prices of the other non distressed homes in the neighborhood dropping as they try to remain competitive.

Something I find even more discouraging is the new construction homes that are going into foreclosure before the communities are complete. The foreclosures and short sales I'm seeing are affecting property values of already completed homes as well as current builder pricing. While it's great for buyers, those homeowners that bought when prices were high are now stuck with homes worth a lot less then what they paid i.e. no equity. The majority of high dollar homes filing for foreclosure were purchased at the height of the real estate market; combine high home prices with excessive use of home equity and you have a recipe for disaster. What's a home owner to do?

Many homeowners are just holding on right now, trying to ride out the wave, while others are turning to "walk away" companies for assistance. I'll touch base about these types of companies in tomorrow's blog. Right now I've got to go show some property!

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