NARs pending home sales index, a forward-looking indicator based on contract signings, rose 4.1% to 101.4 in March from an upwardly revised 97.4 in February. It is 12.8% above March 2011 when it was 89.9. The data reflects contracts but not closings.

The index is now at the highest level since April 2010 when it reached 111.3.

Lawrence Yun, NAR chief economist, said 2012 is expected to be a year of recovery for housing. First-quarter sales closings were the highest first-quarter sales in five years. The latest contract signing activity suggests the second quarter will be equally good, he said.

The housing market has clearly turned the corner, Yun added. Rising sales are bringing down inventory and creating much more balanced conditions … which means home prices will be rising in more areas as the year progresses.

The index is based on a large national sample, typically representing about 20% of transactions for existing-home sales. An index of 100 is equal to the average level of contract activity during 2001, which was the first year of examination.

jhilley@housingwire.com

In his latest report from the W.P. Carey School of Business, Mike Orr talks about short supply and rising prices in the Phoenix-area housing market

Are we actually seeing the start of a housing shortage in the Phoenix area? A new report from the W. P. Carey School of Business at Arizona State University reveals some surprising information for Maricopa and Pinal counties, as of February:

• Housing supply was down a huge 42 percent from the year before.

• Foreclosures were down 52 percent from last February.

• Single-family-home prices have been on the rise since September.

Perhaps most notably, the report’s author, Mike Orr, says some realtors are actually starting to call around to ask people whether they would consider selling homes in desirable neighborhoods.

“Supply is tight, in a pretty extreme way, and it looks likely to stay that way for months,” says Orr, director of the Center for Real Estate Theory and Practice at the W. P. Carey School of Business. “The inventory of single-family homes for sale under $250,000 (without a contract already) is less than 25 days of supply. This is highly unusual and signals a market heavily out of balance, with far more buyers than sellers. It’s now becoming a matter of how much of a price increase will get people to start putting their homes back on the market.”

The median price for a single-family home sold in the Phoenix area in February was up 8.3 percent from last year. This includes new-home sales, and it’s an increase from $115,000 to $124,500. Realtors will note the average price per-square-foot went up 4.1 percent.

February is the start of the selling season that normally runs through June. Orr expects to see lots of activity and even “frantic attempts” to buy over the next three months. This is likely to push prices even higher.

“One thing that could slow this down is appraisals,” explains Orr. “That’s because appraisers are still looking at prices from up to three months ago, and they may be reluctant to write appraisals that match the now-higher market value. This will continue to give all-cash buyers a big advantage over those who need to secure a loan.”

Orr adds that foreclosures and short sales continue to exert a strong influence on the market. They represent about 20 percent of total sales. New home sales make up only 6 percent of the total market.

Buyers from outside Arizona account for 26 percent of the transactions. Also, despite the positive momentum, Orr emphasizes there are still many Phoenix-area homeowners with loans exceeding the market value of their houses.

Orr’s full report, including statistics, charts and a breakdown by different areas of the Valley, can be viewed at http://wpcarey.asu.edu/finance/real-estate/upload/Full-Report-201203.pdf. More analysis is also available from knowWPCarey, the business school’s online resource and newsletter, at http://knowwpcarey.com.

Debbie Freeman, Debbie.Freeman@asu.edu
(480) 965-9271
Communications Manager, W. P. Carey School of Business ]]> http://realtyexecutives.com/kathyfuller/2012/04/18/short-supply-rising-prices-in-phoenix-area-housing-market/feed/ 0 http://realtyexecutives.com/kathyfuller/2012/03/28/kitchens-sell-a-home/ http://realtyexecutives.com/kathyfuller/2012/03/28/kitchens-sell-a-home/#comments Wed, 28 Mar 2012 00:15:30 +0000 kathyfuller http://realtyexecutives.com/kathyfuller/?p=283 Continue reading →]]> By Carla Hill

It’s a tool used by house flippers all across the nation. Stagers know its power. Real estate agents push its importance. What is this not-so-well-kept secret of real estate? A kitchen can sell a house.  A kitchen is the heart of a home. This is true all across the globe. The old saying that the “stomach is the way to the heart” carries a lot of truth. Kitchens are where we spend much of our time and most of that is with our families. It’s the room where we nourish our bodies and our spirits.  

Kitchens are integral to entertaining and in today’s age of open floor plans, they’re a focal piece of many family rooms. It’s because of this that kitchens play such an important role in the buying and selling process.  

This one room is the showpiece of the house. You’ll see it every day and your guests will see it during most visits. This means buyers want homes with up-to-date kitchens.  

Kitchens, however, can be one of the most expensive rooms to renovate. These projects can also be the most labor and time intensive of all home renovations. It’s not just a new layer of paint.  

Instead you find a complicated array of flooring, tiling, cabinets, and counters. This means buyers may want a home with an up-to-date kitchen but they aren’t willing to tackle this problem themselves. Most buyers want a kitchen that is ready to use the day they move in.  

What do buyers look for in up-to-date kitchens? A lot of this depends on what price range your home is in.  

The main thing to remember as a seller is to not price yourself out of your market. If homes in your neighborhood are selling for $100,000 with tidy, but not luxury kitchens, then this is no time to upgrade to granite, travertine, and marble at the price tag of $40,000+. You simply won’t find a buyer.  

Scope out the competition. Use open houses in your area or MLS listings to find out what your competitions’ kitchens look like.  

Do area homes have new solid wood cabinets and granite counters in today’s designer colors? You’ll be wise to consider making the same move. Are they including new stainless steel appliances and add-ons like dishwashers, wine-coolers, and trash compactors?  

Are you in a higher-end neighborhood? It’s time to think high-end. Your older home may have a highly functional kitchen, but a buyer will take one look at your formica counters and white appliances and become lost in the stress of how much money and time it would take to remodel. If you don’t want to put in the time yourself to make upgrades then you’ll have to make concessions in the price.  

Don’t become overwhelmed, though. Sometimes a kitchen update can mean doing just a few minor changes. Change the paint color to a warm, neutral tone. Get rid of any clutter. Update your appliances, paint your cabinets, change the pulls, or get a high-end looking counter for a fraction of the cost (faux-granite or lower end granite). You might even save a bundle by doing much of the work yourself.  

The bottom line is a kitchen can sell a home. Do a little research and find out what your kitchen needs to make it competitive with area listings.

For many, the decision whether to purchase flood insurance can be confusing. While waterfront properties are an obvious choice for protection, homeowners farther inland may not be sure whether they also need flood insurance. Fortunately, the government publishes flood zone maps that can help you determine flood risk and insurance need.

Following the tragic flooding in New Orleans after Hurricane Katrina in 2005, the Federal Emergency Management Agency (FEMA) began improving the flood zone maps which are overseen by the National Flood Insurance Program (NFIP). These flood zones can be found on your community’s Flood Hazard Boundary Map or Flood Insurance Rate Map (FIRM).

To determine the flood risk for your property, the NFIP provides a searchable online database. If you’re a homeowner in a floodplain, it’s not so much a question of if a flood will damage your property as when. Once you know your risk, be prepared through the purchase of the proper level of flood insurance.

Your flood zone determines your risk

Every community is able to participate in the NFIP, which administers flood insurance policies for homeowners, renters and business owners. As can be expected, flood insurance premiums are determined by the risks associated with flooding in your area.

To determine your risk, you need to understand what your property’s zone designation means. FEMA assigns a letter or combination of letters to each zone which defines the likelihood of a flooding incident in that area.

Zones B, C and X: moderate to low risk

Zones designated as B, C or X fit one of the four following criteria:

1. Regions with less than 1 percent annual chance of flooding
2. Regions with a 1 percent annual chance of sheet-flow flooding and average water depths of less than one foot
3. Regions with a 1 percent annual chance of stream flooding and drainage areas of less than one square mile
4. Regions with a 1 percent annual chance of flooding that are protected by levees

While flood insurance may not be required in these zones, it is available for those who wish to protect their home and assets in the case of a catastrophic flooding event. The NFIP makes flood insurance available to all property owners and renters in participating communities, even those in moderate to low risk zones.

The As equal high risk

While flood insurance is optional in moderate to low risk zones, it is mandatory for high-risk properties in communities participating with the NFIP. High-risk zones are designated with the letter A and further broken down into the following classifications:

Zone A: These regions have a 1 percent annual chance of flooding. Over the course of a 30-year mortgage, properties in Zone A have a 26 percent chance of flooding.

Zones AE and A1-A30: Like Zone A, these regions also have a 1 percent annual chance of flooding as well as a 26 percent chance of flooding during the course of a 30-year mortgage.

Zone AH: Properties in this zone are at risk of shallow flooding with average water depths from one to three feet. As with other A zones, there is a 1 percent annual chance of flooding and a 26 percent chance over the course of a 30-year mortgage.

Zone AO: These regions pose a river or stream flooding hazard or have greater than a 1 percent annual chance of shallow flooding at average water depths of one to three feet. There is also a 26 percent chance of flooding over the course of a 30-year loan.

Zone AR: Unlike other A zones, these regions have only a temporarily increased risk of flooding. Generally, they are located in an area where a flood-control system such as a levee or dam is being constructed or restored. While flood insurance is still mandatory for these areas, premium rates may be capped.

Zone A99: These regions have a 1 percent annual chance of flooding but will also benefit from a federal flood-control system once development reaches a certain level.

High-risk coastal: The Vs

As with Zone A properties, flood insurance is mandatory for coastal areas designated Zone V.

Zone V: These are coastal areas that not only have a 1 percent or greater chance of annual flooding but also the additional hazard of storm waves. During a 30-year mortgage, Zone V properties will have a 26 percent chance of flooding.

Zones VE and V1-V30: These zones also have a 1 percent or greater annual chance of flooding as well as the potential for storm wave hazards. There is a 26 percent chance of flooding throughout the course of a 30-year mortgage. Zones VE and V1-V30 are differentiated from other high-risk coastal zones because of detailed analyses conducted on base flood elevations.

Undetermined: D

Zone D: If your property has been designated Zone D, there has been no flood hazard analysis conducted for your area. There may be the possibility of flooding, but the risk has not yet been determined.

Recent flood map changes

In 2008, FEMA completed its first review in 23 years of 90,000 flood hazard maps. Not only were the maps outdated, they did not show levees. “Zone X Protected by Levee” was one of the key changes made to the maps. For this designation, FEMA requires that levee owners demonstrate the barriers are in proper working order and capable of protecting surrounding communities from severe flooding.

In addition, the new maps indicate “floodways” such as interior rivers, creeks and streams. Flood maps now may also include “velocity hazard” notations, which identify coastal regions susceptible to high waves and all locations with potential for fast-moving floodwaters. Finally, an “X500″ category is used to illustrate areas that have a 0.2 percent annual chance for a flood under a new 500-year flood designation.

No Paws Left Behind, Inc. is a focus driven not for profit organization, designed to bring awareness to all communities the silent victims of foreclosure who have no voice or rights to implement change. As a united front, we will restore moral obligations toward all pets that have the potential to be, or have been, left behind to suffer needlessly. We further pledge to act as a support group for those who find foreclosure imminent and need help to find shelter for their beloved pets; be a resource for those who find or know of abandoned pets; and last, but by no means least, we must unite to end the needless suffering by creating a national movement targeting lawmakers to change the laws categorizing pets as personal property.

To find out more visit their website at http://www.nopawsleftbehind.com/

Over the past few years it’s likely that your cell phone has become a business lifeline. From Googling to searching the MLS and writing contracts, agents have a million uses for these smart devices, and  when a tool is critical, it’s  important to be able to use it when you need it.  Battery life is precious, but you can help preserve it and avoid those black screens of horror with these 4 tips.

1)  Avoid temperature extremes.

This might sound weird, but temperature extremes, especially heat, are the biggest threat to the life of your battery. Never leave your phone some place where it might get extremely hot or cold, such as inside a parked car.

2)  Don’t let your battery fully discharge.

Your battery only has e Ideally, try to recharge your battery once it reaches 20% charge, and try not to let your battery completely die before you plug it in. According to Lifehacker author, Whitson Gordon, the best point to recharge your batter is when it decreases to a 50 percent cja,

3)  Turn off power-draining features when you don’t need them.

Your phone can do a lot of things; and every feature uses power.  You don’t need all of your features all of the time, so turn them off when you aren’t using them.  The two biggest power culprits are Wi-Fi and Bluetooth.  If you have an Android, you may want to invest in one of many “App Killers” available in the app marketplace. For iPhone users, to better manage your battery life, be sure you are only using location services for those apps that really neeed.

4)  Don’t keep a fully charged battery on the charger.

Once your battery is fully charged, keeping it on the charger can actually harm the battery.  Try to charge your battery fully, and then take the phone off of the charger.  There are even chargers now that will turn off once they sense that the battery is fully charged.

Following these four simple tips, will keep your battery charged and around for a lot longer. Save your battery when you can so you’ll have it to find out more about a house, write a contract, or take the million-dollar calls when they come in. Wouldn’t you hate to be the agent whose phone killed the deal?

Optimism is building that the housing industry is nearing a bottom — finally.

Home sales and home building are forecast to rise this year after sliding steeply the past five years in housing’s worst downturn since the Great Depression.

Recovery is expected to be slow, and home prices are widely expected to fall this year. But investors are betting on the start of an upturn, bidding up home builder stocks and causing them to outperform the broader stock market.

Chief executives are more positive. JPMorgan Chase’s Jamie Dimon said last week that housing is near its bottom but could stay there a year. Stuart Miller, CEO of home builder Lennar, said the market has started to stabilize because of low prices and record-low interest rates.

Market researcher RBC Capital Markets has also turned from a “bearish” view on housing to saying that 2012 “will mark a step in the right direction.”

Many economists expect home prices to fall more this year because of foreclosures and other properties sold at very low prices.

As foreclosures pick up this year, “prices will drop,” says Stan Humphries, Zillow chief economist. He says home prices won’t bottom until later in 2012 or next year.

On average, prices have fallen by about a third since 2006.

“This year will feel a lot better to builders, investors and real estate agents than to consumers,” says Jed Kolko, economist for real estate website Trulia.

Housing’s outlook is brightening with signs of a better economy. Last month, U.S. employers added 200,000 jobs, and the unemployment rate fell to 8.5%, lowest in nearly three years.

While an economic shock could derail progress, “there’s now more evidence of improvement in the economy, and housing will follow the economy,” says David Crowe, chief economist at the National Association of Home Builders. More improvement is expected for:

•Sales. Existing home sales will rise 12% this year after a 2% increase last year, and new home sales, coming off a horrid year, will jump 74% this year, Moody’s Analytics predicts.

November’s existing home sales hit their highest mark in 10 months, and new home sales were the year’s second best, IHS Global Insight says.

•Construction. Single-family housing starts will rise 37% this year, Moody’s predicts, after falling 9% last year.

Home builder stocks are on a run. The S&P 1500 homebuilding index is up 38% since mid-October, vs. 7% for the S&P 500.

Many buyers today want move-in-ready homes and will quickly eliminate an otherwise great home by focusing on a few visible flaws. Unless your home shines, you may endure showing after showing and open house after open house—and end up with a lower sales price. Before the first prospect walks through your door, consider some smart options for casting your home in its best light.

1. Have a home inspection

Be proactive by arranging for a pre-sale home inspection. For $250 to $400, an inspector will warn you about troubles that could make potential buyers balk. Make repairs before putting your home on the market. In some states, you may have to disclose what the inspection turns up.

2. Get replacement estimates

If your home inspection uncovers necessary repairs you can’t fund, get estimates for the work. The figures will help buyers determine if they can afford the home and the repairs. Also hunt down warranties, guarantees, and user manuals for your furnace, washer and dryer, dishwasher, and any other items you expect to remain with the house.

3. Make minor repairs

Not every repair costs a bundle. Fix as many small problems—sticky doors, torn screens, cracked caulking, dripping faucets—as you can. These may seem trivial, but they’ll give buyers the impression your house isn’t well maintained.

4. Clear the clutter

Clear your kitchen counters of just about everything. Clean your closets by packing up little-used items like out-of-season clothes and old toys. Install closet organizers to maximize space. Put at least one-third of your furniture in storage, especially large pieces, such as entertainment centers and big televisions. Pack up family photos, knickknacks, and wall hangings to depersonalize your home. Store the items you’ve packed offsite or in boxes neatly arranged in your garage or basement.

5. Do a thorough cleaning

A clean house makes a strong first impression that your home has been well cared for. If you can afford it, consider hiring a cleaning service.
If not, wash windows and leave them open to air out your rooms. Clean carpeting and drapes to eliminate cooking odors, smoke, and pet smells. Wash light fixtures and baseboards, mop and wax floors, and give your stove and refrigerator a thorough once-over.

Pay attention to details, too. Wash fingerprints from light switch plates, clean inside the cabinets, and polish doorknobs. Don’t forget to clean your garage, too.

G.M. Filisko is an attorney and award-winning writer who has found happiness in a Chicago brownstone with the best curb appeal on the block. A frequent contributor to many national publications including Bankrate.com, REALTOR® Magazine, and the American Bar Association Journal, she specializes in real estate, business, personal finance, and legal topics.

Visit Houselogic.com for more articles like this. Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®.

With foreclosure rescue scams widespread as more homeowners fall behind on mortgage payments, be smart if you seek help.

A record high 2.8 million properties were hit with foreclosure notices in 2009, putting even more Americans at risk of facing foreclosure rescue scams. Homeowners who fall behind on mortgage payments need to tread carefully when seeking assistance, since foreclosure rescue scams come in many guises. A day spent researching legitimate options, from a mortgage modification or principal forbearance to a short sale or deed-in-lieu, could keep you from becoming a scam victim.

Foreclosure rescue scams run rampant

Homeowners facing foreclosure are prime targets for scam artists. The U.S. Federal Trade Commission identified 71 companies running suspicious foreclosure rescue ads, and the Better Business Bureau counts foreclosure rescue rip-offs among its top 10 scams. Understanding how these scams work can help you avoid becoming a victim.

The variations are seemingly endless, but one popular foreclosure scam involves a representative of a so-called foreclosure rescue company promising to negotiate a deal with your lender. The rep, vowing to take care of everything, will instruct you not to contact your lender, lawyer, or credit counselor during the supposed negotiations. The more brazen ones will even tell you to pay your mortgage directly to them.

Once you pay an upfront fee or hand over a few months’ worth of mortgage payments, the scam artist will disappear. You’ll be left with an emptier wallet and a mortgage that’s in even deeper trouble because no deal was cut and no payments were made on your behalf. According to John Riggins, chief executive of the Fort Worth, Texas, office of the Better Business Bureau, upfront fees can range from $500 to $5,000.

Rip-offs come in many forms

A bankruptcy foreclosure scam can involve a promise to fend off foreclosure in exchange for an upfront fee. Instead of getting you legitimate relief, the fraudster will pocket the fee and secretly file a bankruptcy case in your name. The scam may seem to work initially, because a bankruptcy filing will stop foreclosure proceedings temporarily, but they’ll resume. Compounding your problems, a bankruptcy can mar your credit report for 10 years.

Another common scam, called the bait-and-switch, results in a scam artist taking ownership of your home. You sign documents supposedly for a new loan that will make your mortgage current. What’s really happening is you’re signing over the deed of your house. In this scenario you would still owe on your mortgage but no longer own the home.

In a rent-to-own scheme, you’re told to surrender a home’s deed as part of a deal that lets you stay put as a renter. The scam artist, perhaps claiming to be able to refinance at a better rate with you off the title, promises to sell the house back to you in the future. However, terms of the deal may make it all but impossible for you to repurchase the home, or the scammer may get you evicted by raising the rent beyond your means. Either way, you end up losing the home while remaining on the hook for the unpaid mortgage.

Look out for red flags

Being aware of the warnings signs can protect you from foreclosure rescue scams. Red flags include:
•    Demands for high upfront fees.
•    Guarantees to stop a foreclosure.
•    Instructions to make mortgage payments to someone other than your lender.
•    Pressure to sign over a deed.

Legitimate foreclosure counselors won’t put on a full-court press, nor will they guarantee that you won’t lose your home to foreclosure. What they will do is review your financial situation and offer up options. Foreclosure counselors approved by the U.S. Department of Housing and Urban Development won’t charge you a fee either.

Legitimate ways to get foreclosure help

There are a number of legitimate ways to contend with foreclosure. If you’ve missed mortgage payments, start by getting in touch with your lender. Ask to speak with someone in the Loss Mitigation Department and explain your situation.

Your lender may be able to arrange a repayment plan, called a special forbearance, based on your current economic circumstances. The lender could even give you a temporary reduction in your monthly payment or suspend payments for a period of time.

With a principal forbearance, the lender will reduce the amount of your mortgage, thus reducing your monthly payments. However, the amount of the principal reduction doesn’t disappear. Rather, it’s tacked on to the end of the loan, effectively creating a balloon payment.

A federally facilitated mortgage modification could also help. The Making Home Affordable modification program pays lenders to re-work loan terms and lower monthly payments. Be prepared to gather lots of paperwork and undergo a trial modification.

If all else fails, you may need to give up your home. If so, look into the federal Home Affordable Foreclosure Alternatives program. HAFA offers lenders financial incentives to opt for a short sale or deed-in-lieu rather than a foreclosure. In a short sale, a lender agrees for a home to be sold for less than the outstanding mortgage, and then considers the debt paid off. In a deed-in-lieu, a homeowner turns over the home to the lender, and the mortgage is closed.

Donna Fuscaldo has written about personal finance for Dow Jones, the Wall Street Journal, and Fox Business News for more than a decade. Like many homeowners, her mortgage is precariously close to being underwater.

Visit Houselogic.com for more articles like this. Reprinted from HouseLogic.com with permission of the NATIONAL ASSOCIATION OF REALTORS®.