Anna-Lise Troup's Tucson Area Real Estate Update: April 2008

Introducing Low Interest Home Loans for First-Time Homebuyers or Veterans. 5.99% for a 30-Year Fixed Rate Mortgage (5.89% for Veterans), and Optional 7% Down Payment & Closing Cost Assistance.

This is a great promotion for military buyers at Davis-Monthan Air Force Base or military personnel who are moving to Tucson. Retired military are included too!

K. Hovnanian Homes has introduced a "Homes for Heroes" program where community heroes will receive a 3 percent discount off the base price of new homes. The "Homes for Heroes" program applies to active and retired military, teachers, law enforcement officers, firefighters and health care professionals.

The offer is available to anyone who presents documentation of service and is valid in addition to advertised special promotions.

Loan to values and documentation requirements
aren’t the only things that have changed as a
result of the credit crunch and liquidity crisis.
Appraisal standards as dictated by the end
lenders and agencies, Fannie Mae and Freddie
Mac, have also tightened up tremendously. The
differences and changes in the appraisal world
are important for all of us to know. These
requirements can help to establish what you list a
house for or what offer you decide to make since
financing is always going to be dependent upon
the appraisal.

Appraisers utilize comparable properties sold
within close proximity to the subject property in
establishing value. Comparables are defined as
those properties that are “like” the subject
property in size, layout, functionality and
upgrades. By finding properties that are slightly
better than and slightly less than the subject
property, the subject property’s value is
established somewhere within the middle. This
method is called “bracketing”. The trick to
bracketing is finding the comparables. They
must be within a certain range better and worse,
larger and smaller, etc., and within the shortest
distance. Price per square foot is not a normal
consideration for an appraiser. They will not
consider a house that is dramatically larger or
dramatically smaller to be a true comparable, and
therefore, will dismiss a sale accordingly.

The biggest change for the appraisers these days
is their ability to choose comparables. In times
past, appraisers had the ability to dismiss sales
that were considered to be “distressed” sales
when choosing the comps for the appraisals.
Since distressed sales were the exception, they
were not a true indication of the market value in
a neighborhood. Some appraisers would also
exclude those comparables that may not support
the “target value” whether that is a sales price or
a required value for a refinance. Because of the
stability of the real estate market for so long,
these practices never seemed to be a big deal
until now.

With unprecedented foreclosures and short sales,
banks have found the appraised value in the
difficult real estate market today to be of utmost
importance. Upon review and audit of appraisals,
particularly those with lower down payments,
available comparable data is being scrutinized to
ensure those chosen are the best available
regardless of circumstances surrounding the sale.
Although standard appraisal practices allow
comparable sales to be within 6 months and up
to 1 year old and typically within 1-3 miles
away, lenders are now requiring at least 2 comps
to have been sold within the last 90 days.
Lenders are also looking for pending sales and
listed properties to further verify and support the
established value. When this criteria can not be
met, the appraisals are subject to heavy scrutiny
and may be required to have some sort of second
review done or even a 2nd appraisal to be
completed to further verify the value.

So, when comp-ing a house out, keep this criteria
in mind – sales within the last 90 days that meet
bracketing requirements of bigger-smaller, better
and less within the closest proximity. The
appraiser will have to, so better to be aware of
the current appraisal practices and make your
sellers aware of how that neighbor who cheap-
sold their house can have a dramatically negative
affect to the value of all the homes in the
neighborhood. And just because an appraiser
will do an appraisal at a certain value does not
guarantee the appraisal will be acceptable under
current underwriter scrutiny.

Article Provided by Courtney Walker, Nova Home Loans (520) 750-8888
April 21, 2008 Newsletter

SPRING HISTORICALLY BRINGS MORE ACTIVITY TO THE TUCSON REAL ESTATE MARKET

March 2008 has kicked off an active Spring according to the Tucson Association of Realtors Multiple Listing Service March 2008 Monthly Statistical Digest, according to Judy Lowe of Realty Executives Southern Arizona.

The 1,410 new contracts opening escrow in March ’08 were 30.67% ahead of the
1,079 in Jan. ’08, and 18.28% ahead of the 1,192 in the same month in 2007. Except
for June and July ’07, this is the strongest number of new escrows for any month since June ’06 (21 months ago).

These new escrows, coupled with the 9.81% fewer (when compared to March '07)
new listings coming on the market, indicate a decline in the Listing inventory. The Active Listings actually declined to 9,022, compared to 9,168 in February ’08. This is still considered a very strong listing inventory, however, there
has definitely been an increase in buyer activity visiting the most well priced homes.

Some neighborhoods in Tucson have experienced downward pricing pressure, which may be the determining factor in the decline in the March ’08 Median Sales Price of $200,000, compared to the March ’07 Median of $220,000,although we have actually seen a slight increase when we look back over the last few months in 2008. Many feel
“our sales pricing has now stabilized,"

The buyer pool is being fueled by a “pent up” buyer demand, a very large number of homes to choose from, still low interest rates, and the availability of home loans for all price ranges. These buyers are finding that working closely with their Realtor keeps them “on the cutting edge” of the real estate market.

Following are some interested statistics from information gathered by the TUCSON ASSOCIATION OF REALTORS:

Home Sales Volume: Decreased 35.64% from $362,397,582 in March 2007 to $233,207,940 in March 2008.

Home Sales Units: Decreased 32.78% from 1,339 in March 2007 to 900 in March 2008.

Average Sales Price (all residential types): Decreased 4.25% from $270,648 in March 2007 to $259,120 in March 2008.

Median Sales Price (the price at which half the homes were sold above and half below): Decreased 9.42% from $220,815 in March 2007 to $200,000 in March 2008.

Pending Contracts (transactions subject to contract but not yet closed escrow): Increased 18.28% from 1,192 in March 2007 to 1,410 in March 2008.

Active Listings: Decreased 11.41% from 10,185 in March 2007 to 9,022 in March 2008.

New Listings: Decreased 9.81% from 2,710 in March 2007 to 2,444 in March 2008.

Passages of Tucson Project Rivals Mall of America
The Passages of Tucson is a 400-acre parcel of land that could include more than six million square feet of mixed-use development. This would make it one of the largest regional shopping centers in the nation. Robert Hoffman, president of Hoffman-Howard Development is the visionary behind Passages of Tucson. So why chose a development that large 20 miles outside of Tucson? Jim Miller, head of the Tucson-based development team, says it's an ideal location.

Read more at www.InsideArizonaBusiness.com

Labels: Real Estate Development in Arizona

For those of you who are interested in real estate in Rancho Sahuarita, located southwest of Tucson, here's an intersting press release. Please contact me if you'd like more info about homes for sale in Sahuarita, Arizona.

According to renowned real estate consulting firm Robert Charles Lesser, for the second year in a row Rancho Sahuarita has been ranked #11 in a list of the best-selling master planned communities in the nation, based on total number of new homes sold in 2007. Approximately 573 homes were sold throughout 2007 to homebuyers in Rancho Sahuarita. Since Rancho Sahuarita opened in July 2001, almost 4,100 homes have been purchased and more than 9,000 people now call this innovative community home.

On a local level, Rancho Sahuarita continues to hold a strong share of the Tucson housing market. With 573 homes sold, which is a 17 percent increase over 2006 sales, Rancho Sahuarita’s overall market share has increased to 11 percent for 2007.

“The value of living in this community is more than just affordable homes, beautiful neighborhoods and recreational amenities; it is the sense of community that really convinces families that Rancho Sahuarita is the perfect place to live,” says Bob Sharpe, Managing Partner of Rancho Sahuarita.

With 12 neighborhoods from five quality national and regional builders, homes at Rancho Sahuarita are available from the $150,000’s. Its location, off I-19 just 17 minutes south of downtown Tucson, makes Rancho Sahuarita a reasonable commute for both work and play.

Rancho Sahuarita’s offers a highly amenitized lifestyle. There is a 15-acre lake park in the center of the community that is ideal for sailing, fishing or enjoying a performance at the lake’s amphitheatre. There are miles of paved trails that weave throughout the community that connect neighborhoods and schools. The eight parks offer a variety of features including a Safari Trail with life-sized bronze statues of African animals, Desert Interpretative and Butterfly Gardens, picnic tables and shaded tot lots. At the centerpiece of this recreational master plan is Club Rancho Sahuarita, with the largest private splash park in Arizona and a 6,000 sq. ft. fitness facility.

An 8,000 sq. ft. Kids Club is the ideal place for children and teens to spend time, complete with a “Kids Time” babysitting area, “arcade” room, and multi-purpose room that serves to host resident parties and children celebrations. Adjacent to the Kids Club is an expanded Activity Park that contains an electric train for weekend rides, a pedal car racetrack, a nine-hole miniature golf course, a shaded playground, and an event lawn for concerts and outdoor entertainment. Also recently completed are two new recreational centers to provide residents with additional lap pools, spas and sport courts, and there’s even a “Bark Park” that caters to our four-legged friends.

Commercial amenities are also a growing part of the Rancho Sahuarita master plan with the opening of the area’s first 108,000 sq. ft. Fry’s Marketplace. Together with 35,000 sq. ft. of adjacent retail space, a Chase bank and Carondelet urgent care, this first phase in the development of the Rancho Sahuarita Marketplace and Village will be one of Tucson’s premier shopping destinations.

Press Release. Published 4-2-08 in Arizona Daily Star