Real Estate Information Archive

It appears that additional recovery efforts are coming our way for Arizona real estate in 2012. There is a trend towards more short sale approvals from lenders due to more streamlining of their processes. This reduces the number of trustee sales and foreclosures. A greater percentage of properties that do go to trustee sales will likely sell to third parties as the lenders are motivated to reduce the number of bank owned real estate. We have a shortage of available home listings for sale right now and many of our listings receive multiple offers and buyers that are willing to pay over appraisal amount. This is the law of supply and demand. The market is weighted towards a sellers market but our market is sensitive to many outside factors that could change that on any given day. We spend a lot of time and money to market all of our listings as though they were luxury homes so that may explain why we receive multiple offers on almost all of them. There is no quick fix for our economy but there is light at the end of the tunnel.

I’m often asked if this is a good time to buy a home.  Some clients are concerned that home prices may fall further than they have already.  They are assuming that the best course of action is to wait for the bottom in the market and then buy.  The problem with this approach is that you don’t know where the bottom is until you see it in the rear view mirror, meaning until you’ve missed it!

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability.  Even though interest rates have gone up in the last six months, they are still near historic lows.  Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates go up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life.  It’s important to live in a home that reflects your taste and values, yet is within your financial “comfort zone.”  To that end, it may be more important to lock in today’s relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today’s market.