Betsie Melter's Real Estate Blog

Many people have been holding off on buying a new home because they wanted to wait and see what the market was going to do. Well, 2010 is almost gone and my advice would be to put buying a home on your resolution list for 2011. There are many reasons now is the time to buy. I will outline just a few of my thoughts:

1) Interest Rates are going up! Interest Rates have been creeping up for the last few weeks and are predicted to be into the 5% range at the first of the year. Holding off too long will mean maybe changing your price point on that new home. The higher interest rates go, the more a buyer might need to drop their price in order to stay in their comfortable range of monthly mortgage payments.

2) Home Prices are still at an all time low! The Phoenix Market place has had another drop in price from July to October. The prices have stabilized since October and are moving up and down slightly. It is a great time to buy with the prices so low. Even if the prices drop slightly, they are expected to rebound again.

3) Competition is Down for now. Many buyers seem to start looking in the Spring. This adds more competition and likely a bidding war on the house you might be putting an offer in on. I know, you think I am crazy when I say "a bidding war". But it is true. Even in the past 4 years, I have had multiple homes that my buyer's have gotten into bidding wars on. They say it is a buyer's market but when a nice house comes on the market, many buyers jump for it and creates a frenzy. So, if you start looking now, before the Spring Rush, you may dodge a bullet and not have to compete.

4) Real Estate is a good investment! In the past few years, many have lost money in the Real Estate Market. But the old Theory stays true "Buy Low and Sell High". This is the Low that everyone talks about. So you might as well start making an investment in your future now and see how it grows in the long term.

I am anxious for the New Year and can't wait to help many people find that new home, or vacation home here in Arizona.

Happy Holiday!

Sometimes I think we forget the importance of walk thru's in our business. We know that it is a formality to do one before closing escrow, but do we do them just because it is on our checklist, or do we actually take our repair list and go through the house to make sure the repairs were made?

Most of the time, buyers are excited about getting their keys and making all of the arrangements with the movers and turning utilities on, but do we really do a thorough job at the walk thru? The most important thing to keep in mind is that we are not looking for new problems, but we do need to make sure that the main items work (a/c, heater, plumbing etc) and that nothing is considerably different than when the offer was accepted. Walking through the house and turning on the water, flushing the toilets, turning the a/c on to see if it is blowing cool air, opening and closing the garage door are all tasks that should be done at a walk through to make sure the buyers are moving into a livable house.

If repairs were part of the negotiations, then we need to check to make sure they were completed. There are a few ways that the buyer's can be sure that the repairs were made. First, they can get copies of the receipts that show the repairs were made by a licensed contractor. Secondly, if the repairs are harder to notice than just by looking at them, then they can have their inspector come back to the house and re-inspect to make sure the repairs were, in fact done.

It is also important to make sure that the items that are supposed to stay with the house have remained inside for example refrigerator, washer, dryer etc.

I think walk thru's are more important in today's market then in the past because of all of the the vacant foreclosed homes. Vandalism has become very prevalent. It is a smart move to swing by the house one last time just a few hours before recordation to make sure there have been no break ins and the house is still in one piece with nothing missing or broken.

About 2 years ago homes started selling rather quickly in the city of Maricopa, AZ. Then about a year ago homes would have multiple offers within an hour of posting (luckily they were foreclosures so the banks made quick decisions and buyers new right away if they had were the lucky winners of that house). Today, is the same, but in a completely different way.

The Foreclosure inventory in Maricopa is less than 1 month. That being said, the homes that are on the market are still going in hours or days, but they are short sales. UGGGGGG. The entire job description has changed when you are dealing with short sales. Instead of buyers placing their bid and waiting to see if their's was selected, buyers are now racing around putting multiple bids on every house that is available.

This makes it hard for both the buyer's agent and the listing agent. It also skews the numbers in the market and makes the stats of the inventory incorrect. Take for example 1 buyer putting in 10 bids on short sales. When one actually gets accepted by the bank the other 9 offers are now rejected which means the houses are back on the market. Hopefully the agent had accepted back up offers so they can move the next person up. But then think of it this way too, if the buyers weren't putting in multiple offers than the other buyers wouldn't have to put in multiple offers either. Does that make sense? My brain hurts!  Seriously though, if that one buyer had only put in that one bid, the other 9 houses would be available for 9 other buyers. Instead I feel like my buyer who is waiting on 10 bids as well wouldn't have had to put in 10 bids and be in backup position on 5 of them if everyone just slowed down and chose the house they really wanted in the first place.

Who's fault is this? Well, nobody's fault but the system of short sales works so slowly that buyers get anxious and want to have an answer. It gets to the point where they don't even care what house it is as long as it gets accepted. Wow, who would have thought that the biggest purchase someone would make would come down to throwing out bids and seeing which one will stick?

I have been getting this question a lot lately. Because investors have begun buying and flipping homes again some are selling within 90 days of being bought by the investor. According to the FHA guidelines, a buyer cannot purchase a home that is being resold within 90 days. I have been informed by one of my lender's that the rules have changed and they have lifted that 90 day hold in order to reduce some of the inventory currently on the market. My best advice is to ask the listing agent ahead of time if that particular home has been purchased within 90 days and if so talk to the lender upfront to see if it is a home that the buyer can pursue. In most cases, it may not be. But if you have a knowledgable lender, then they may know how to get around the rule. According to the FHA, it is completely up to interpretation and just depends on who you get as an underwriter and which way they interpret the guidelines.

Good Luck, noone ever said getting a loan was easy, and it is even more difficult in this market.