Video 24: Dean Ouellette discusses some market stats for the Tempe condo market and Phoenix condo market in September 2009. The activity is way up almost tripple what was a year ago, but prices for both the Tempe and Phoenix condo market are way down. In August the Tempe condo market had a bump in value due to a sale of a unit in Bridgeview. For more information you can leave a comment or e-mail me Dean Ouellette.
If you read the post below this one you have already heard about frustration with the most recent bank I have been dealing with on a “quick” cash foreclosure closing. I know personally these days when I go to blogs I would rather watch videos than read a post, so I decided I would add more video to my blog. Here is my first installment which summarizes why REO banks suck post below. Would love to hear your feedback. And yes I know, I have a face for radio and a voice for print.
I have a cash buyer looking a quick closing because his son is going to be going to ASU and he wants a small condo or house to fix up and live in. With school starting in three weeks we needed to move quick and found a condo that worked out perfectly. I went to the property two days after it was on the market and it had yet to be trashed out, and it was trashed!
On August 5th we submitted an offer for full price, waived any inspections and offered a quick close of August 21st.
On August 8th we get notice that the bank wants to work with us. The sent us their addendums and they set the closing date on or before August 28th. My client is not overly happy, but I told him we would do what we could to try to make it before. My out of state buyer signs the addendums and we send them back to the bank on August 8th.
In the bank addendums it has standard language:
The closing shall occur on or before August 28th, 2009. If transaction does not close on time as agreed, at no fault of Seller, Buyer agrees to pay a $100.00/day per diem charge to the Seller.
Do I like the language, no. Do we have any choice, no.
Fast forward to August 27th, is the buyer ready to close? Shoot, he has been ready to close for two weeks now, one slight problem, the Seller has still not signed off on their addendums from August 8th that they sent us. Guess we are not closing on time. We don’t even have an officially executed contract. Fast forward to September 8th, our extension is about ready to run out, the trash out has still not occurred and the Seller is still not signing off on all their docs. We need another extension and the Seller has sent over an extension giving them until 9/28/2009. Meanwhile my client is living in a motel because school started three weeks ago.
I decided to draft my own extension and send it to the Seller, this one read close of escrow shall be on or before 9/14/2008 and if it does not close on time at no fault of the Buyer, the Seller agrees to pay a $100.00/day per diem charge to the Buyer. It seems fair to me, they wanted us to close on time or pay a penalty, why not hold them to same standard?
Well guess what, for the first time since we started working on this quick closing cash deal over a month ago the Seller is quick to respond. No. Yea – no surprise, I never expected them to sign it, but it does prove a point. Foreclosure banks want you to hurry up and perform, and will fine you if you do not, but they will make their own rules for themselves.
I know, we didn’t have to sign the addendum, but then my buyer does not get the Phoenix Condo they wanted. We are at the mercy of the banks right now. They are writing the rules and not only are they completely in their favor, they are completely non-negotiable. Under normal market circumstances I would never advice my clients to sign the language in a bank addendum, but these are not normal market circumstances. If you want the house, if you want that condo or house foreclosure deal, you need to sign it. Yup, it sucks.
The short sale market in the Phoenix area is changing quickly because of the low level of bank owned foreclosures on the market. It used to be when I met with a new buyer and we were talking about what they wanted I would explain to them the short sale process vs. the foreclosure process and they would almost always tell me to forget short sales. But times are changing.
Just a couple months ago there were so many foreclosures on the market in the Phoenix and Tempe area you would not need to look at the short sales, but that is no longer the case. Last week I started working with a new couple who contacted my via this site and they we talked about what they wanted. They wanted to stay in Tempe and were looking at either single family homes or possible Tempe condos.
If you look at the market today, there are 373 active single family detached homes in Tempe as I type this and 105 active Tempe condos. Of those single family homes that are active, only 23 are foreclosures and of the 105 Tempe condos only 5 are bank owned foreclosures.
No longer can the buyer looking in a limited area focus solely on bank owned foreclosures, they need to consider short sales, unless they need to be in a home within the next couple of months.
So what has this done to the short sale market in Tempe? If I called on a foreclosure property a couple of months ago there may have been a few offers on the property, but when I called on the short sale homes there were rarely offers. I just finished calling on three short sales properties in Tempe which had all been on the market for less than three weeks. The three properties had 2, 7 and 13 offers on them.
This is good news for the person who needs to sell their home via a short-sale, but not good news for buyers. If you are looking to sell your home or condo on a short-sale, and you price it right, there is little reason you should not have offers in the first few days. Of course that all depends on the price and condition of your home too.
So for buyers short sales have become a viable option. After bidding on multiple homes for the past six weeks they may have become frustrated about always being outbid and are thinking of the short sale side of the market. There is still less competition on the short sale side than the foreclosure side, but that gap is starting to close.
I was previewing a few condominiums in Tempe for an out of state client this afternoon and it struck me, there are some great deals in the Tempe and Phoenix condo markets. If you are thinking about a property for yourself or your ASU student, now is a great time.
All you need to do is look at my post from last night on the March 2009 Tempe condo numbers and you will see the market is slow. While the foreclosure market in the surrounding areas is booming, the condo, and especially the luxury condo market, is lagging behind. That leads me to short list on why now is a great time to buy your Tempe or Phoenix condo.
The City of Phoenix is launching a new program which will help homebuyers in the city purchase single family homes and condominiums. Potential homebuyers may qualify to receive up to $15,000 in down payment and closing cost assistance to help buy foreclosed properties in the city.
Phoenix is calling the program the Phoenix Neighborhood Stabilization Program Homeownership Assistance Program. Say that ten times quick.
The money the buyer receives [Read more...]
One of my best friends called me the other day and said his dad may have some buyers for me. His father is a former Air Force General who currently owns an import/export business that does work in China. Many of his contacts in China had been asking about luxury condos in cities such as Los Angeles, San Diego and Phoenix.
I told him I could help him out in the Phoenix and Tempe condo market. There were plenty of Tempe and Phoenix condos on the market that would match what they may be looking for. [Read more...]
To be a real estate agent in the Tempe and Phoenix areas over the last few months has been an exciting time. House prices have dropped to the point where investors and buyers are coming out from hiding. All these new buyers have made my year very busy so far and I look forward to it staying that way.
This year I have been blogging every day at other real estate websites and that has cut into the time I have spent here on my own site, but that has been changing. [Read more...]
