Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected]602-648-1230 1 Residential Focus May 2010 Issue: The Newsletter for knowledge on the Greater Phoenix Residential Market Did the First-Time Homebuyer’s Tax Credit Increase Sales By Fletcher Wilcox V.P. Grand Canyon Title Agency, Inc. [email protected]602-648-1230
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Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Residential Focus May 2010 Issue: The Newsletter for knowledge on the Greater Phoenix Residential Market
Did the First-Time Homebuyer’s Tax Credit Increase Sales
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Did the First-Time Homebuyer’s Tax Credit Increase Sales? Yes, it did. The numbers write this story. In April 2010, 10,558 homes went Under Contract compared to 6,691 in May 2010 for a drop of 37%. See Table 1. The average number of homes going Under Contract per day was 353 in April compared to 215 this May. In the last three days of April, 1,645 homes went under contract compared to 202 in May. Part of the 37% decrease in properties going Under Contract may have been seasonal. In May 2009, the percent Under Contract dropped 16% in May from April. May residential sales again were over 9,000 for the second month in a row. A confluence of events elevated sales in May: the first-time homebuyers tax credit, affordable home prices, low interest rates, investors, FHA financing and the HUD relaxation of the 90 day no flip waiver effective February 1, 2010. Before the no flip waiver, an investor on a fix and flip had to own the home for 90 days before they could go under contract and sell the property to a buyer purchasing with FHA financing.
Table 1 Number of Residential Properties Under Contract
Last Twelve Months All Eight ARMLS Residential Categories
Average per day 300 269 270 270 250 209 200 243 302 326 352 216
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Table 2 Comparison
Under Contract
April 2010 to May 2010 by List Price Range All Eight ARMLS Residential Categories
The list price range with the highest percentage decrease going Under Contract in May was $150,000 to 199,999 at 47%. While most list price ranges had percentage decreases this was not so for list prices over $1,000,000. The number of properties going Under Contract with a list price of $1,000,000 or more stayed the same or increased.
List Price Range
April 2010 Under Contract
May 2010 Under Contract
Percentage Change
Under $50,000 910 730 -20% 50,000 to 99,999 2,695 1,749 -35% 100,000 to 149,999 2,736 1,569 -43% 150,000 to 199,999 1,618 859 -47% 200,000 to 249,999 884 517 -42% 250,000 to 299,999 523 368 -30% 300,000 to 349,999 308 229 -26% 350,000 to 399,999 248 170 -31% 400,000 to 499,999 230 192 -17% 500,000 to 599,999 133 95 -29% 600,000 to 699,999 84 50 -40% 700,000 to 799,999 52 32 -38% 800,000 to 899,999 28 30 7% 900,000 to 999,999 30 18 -40% 1,000,000 to 1,499,999 47 47 0% 1,500,000 to 1,999,999 8 9 13% 2,000,000 to 2,999,999 17 17 0% Over 3,000,000 7 10 43%
TOTAL 10,558 6,691 37%
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Short Sale Update
Short sale closings over 1,900 for second consecutive month.
The Treasury’s HAFA program (Home Affordable Foreclosure Alternatives) went into effect April 5, 2010. The Treasury’s program excluded loans held by Freddie Mac and Fannie Mae. This in effect excluded many home loans from participating in the Treasury’s HAFA Program. On Tuesday, June 1, 2010 Fannie Mae announced their HAFA Program. Below is the Fannie Mae’s announcement along with links for more information on their short sale program. Announcement: Fannie Mae Introduces HAFA Program
On Tuesday, June 1, Fannie Mae issued Servicing Guide Announcement SVC-2010-07, introducing Fannie Mae's Home Affordable Foreclosure Alternatives (HAFA) Program. It, like Treasury's Home Affordable Foreclosure Alternatives Program (as described in Supplemental Directive 09-09 Revised), is designed to mitigate the impact of foreclosures on borrowers who are eligible for a loan modification under the Home Affordable Modification Program (HAMP) but ultimately are unsuccessful in obtaining one.
Program Features The Fannie Mae Home Affordable Foreclosure Alternatives Program, which becomes effective August 1, 2010, simplifies and streamlines the use of short or "preforeclosure" sale and deed-in-lieu of foreclosure (DIL) options on HAMP-eligible loans by incorporating the following unique features:
• Complements HAMP by providing alternatives for borrowers who are HAMP eligible (including borrowers facing imminent default);
• Allows the borrower to receive pre-approved short sale terms prior to the property listing;
• Prohibits the servicer from requiring, as a condition of approving the short sale, a reduction in the real estate commission agreed upon in the listing agreement;
• Releases the successful HAFA borrower from future liability for the debt;
• Uses standard processes, documents, and timeframes;
• Provides financial incentives to borrowers, servicers and subordinate lien holders; and
• Utilizes verified borrower financial and hardship information collected in conjunction with HAMP, eliminating the need for additional eligibility analysis.
For More Information For complete program information, read the Announcement. Other related materials are available on the new HAFA page on eFannieMae.com.
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Chart 1
Number of Residential Sales for Greater Phoenix
All Eight ARMLS Residential Categories Included
10,252
2,912
4,7425,474
7,6288,552
9,2849,3509,0968,0387,9158,1437,4407,555
5,7296,539
8,9919,2989,105
0
2,000
4,000
6,000
8,000
10,000
12,000
Jun-
05Ja
n-08
Jan-
09 FebM
arch
Apr
il
May
June
July
Aug
Sep Oct
Nov
Dec
Jan-
10 FebM
arch
Apr
il M
ay
Historical Perspective
Most ARMLS residential sales in a month were 10,252 of June 2005, with a median sales price of $250,000. Least ARMLS residential sales in a month were 2,912 of January 2008, with a median sales price of $220,000.
May 2010 residential sales were 9,105 with a median sales price of $130,000.
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Chart 2
May 2010 Median Home Sales Price Up $3,000 from April 2010
With the high number of homes sales, there are a lot of contracts written incorrectly using FHA, VA and conventional loan financing. All of these loan types may have specific contract language that needs to be addressed in the AAR Residential Resale Contract. Contact me for the next class I teach on Contract Writing and Financing.
* The 37 FHA closings in May 2005 was the least number of FHA closings for a month this century. **The 2,942 FHA closings in May 2010 was the highest number of FHA closings for a month this century.
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Table 10
How Residential Properties Were Purchased: Most and Least in a Month this Century
How Residential Properties Were Purchased
Most in a Month Least in a Month
Conventional
August 2005 7,507
January 2008 1,757
FHA Guarantee
May 2010 2,942
May 2005 37
VA Guarantee
May 2010 335
August 2005 24
Cash
April 2010 3,634
September 2007 367
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Arizona School of Real Estate & Business Presents
Short Sale Summit: Agent Duties & Liabilities
June 25, 2010 from 9:00 a.m. to 1:00 p.m. Four hours of Commissioner Standards
• Three panels
• Fifteen guest speakers
• Designated brokers speak on shorts sales
• Lawyers speak on short sales
• Escrow speaks on short sales
• Listing techniques
• Presenting offers
• MLS rules
• Lenders Acceptance
• Junior lien holders
• Scams and frauds
• More!
• Moderators Bill Gray and Fletcher Wilcox
Call 480-946-5388 today to register! Short Sale closings almost 2,000 per month!
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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This report is for real estate agents only. Some data in this report is from ARMLS. Residential Focus does not guarantee the accuracy of the data in this report. Some numbers will be adjusted. Report may not reflect all real estate activity. Information should be verified. This article is of a general nature, and is not intended as real estate advice, lending advice or legal advice. Please consult your broker, your lender and your own independent legal counsel. The information in this report may not be the opinion of Grand Canyon Title Agency, Inc.
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Residential Focus By
Fletcher Wilcox V. P. Business Development for Grand Canyon Title Agency, Inc.
• Fletcher is proud to be a part of Grand Canyon Title Agency, Inc. The company has been closing escrows in the Valley for twenty-seven years and has sixteen escrow offices in the Valley.
• Born and raised in Arizona, Fletcher remained in the state to receive his Bachelor of Science degree and a Master of Arts degree from Arizona State University. Obtained an Arizona Real Estate license in 1985. Co-listed and closed a $2.5 million dollar commercial property in 1986.
• He is a member of the following associations Arizona State Escrow Association http://www.azsea.org/ Arizona Association of Realtors www.AAROnline.com Scottsdale Area Association of Realtors www.SAAROnline.com Education V.P. for the Arizona Mortgage Lenders Association www.azmortgagelenders.com/ Publicity coordinator and statistician for the Heart of Scottsdale Tour http://www.saaronline.com/marketing/scottsdale.php Past statistician for the Scottsdale Luxury Tour http://www.saaronline.com/marketing/scottsdale.php
• Fletcher is author of “Residential Focus" a newsletter which provides statistics and analysis for real estate trends and market conditions in Greater Phoenix; he has been a guest speaker on KTAR, KJZZ/NPR and KFNN/Financial News Radio and his market analysis has been mentioned in the Arizona Republic and AZCentral.com. He is a contributing columnist for the Arizona Journal of
Real Estate & Business and has written for the Arizona Association of Realtors publication Arizona Realtor Magazine; He teaches renewal courses on the Residential Resale Real Estate Purchase Contract, short sales and foreclosures and on the new Good Faith Estimate and HUD-1. From 2006 through 2008 was chairman and MC for the Industry Partners Conference: a conference involving the Arizona Association of Realtors, the Arizona Mortgage Lenders Association and the Arizona State Escrow Association.
• To promote music and the arts for teenagers, Fletcher joined Alice Cooper’s Solid Rock organization as a board member.
• He served eleven years as a citizen board member on the Phoenix Police Department’s Disciplinary Review & Use of Force Boards.
• Fletcher started snowboarding in 2008 going on six trips. He is not very good.
Residential Focus By Fletcher Wilcox, Vice President of Business Development, Grand Canyon Title Agency, Inc. [email protected] 602-648-1230
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Locations for Grand Canyon Title Agency, Inc.
Arrowhead - 17235 N. 75th Ave. #A-125, Glendale, AZ 85308 Mickey Garcia, Sales Representative 602-474-5106 → Tony Tice – Manager 602-474-5104 Biltmore - 2730 E. Camelback Rd. Ste. 105 Phoenix, AZ 85106 Trace LaBarr, Sales Representative 602-474-5328 → Denise Eagar – Manager 602-468-7715 Commercial - 2720 E. Camelback Rd. #100, Phoenix, AZ 85016 Laurie Sheedy-Sandau, Sales Representative 602-474-5220
602-468-7777 Fountains - 16150 N. Arrowhead Fountains Ctr Dr. #175, Peoria, AZ 85382 Call 602-648-1230 → Heidi Velarde – Manager 602-474-5126
Fountain Hills - 17251 E. Shea Blvd. #2, Fountain Hills, AZ 85268 Adam Saunders, Sales Representative 602-474-5218 → Kristeen Garcia – Manager 602-474-5120