Dec 31
Happy New Year 2011.
2010 is but a memory. No matter how it looked – good, bad, indifferent, it is past us and a new year is ahead, and enough time to follow your bliss however tamed or extravagant it may be.
"What fools call ‘wasting time’ is often the best investment" (Nassim Nicholas Taleb from – The Bed of Procrustes)
Artur & Joanna
When buyers walk away from a short sale purchase the result, often, is a seller, needlessly, going into foreclosure.
It seems to be happening more often. We hear it everyday, even several times a day. A transaction falls apart and the seller often goes into foreclosure despite obtaining an agreement letter from the bank stating that they have an approved short sale and can proceed with closing.
How’s that happen? It happens when buyers, seemingly motivated, ready and willing buyers – upon hearing a short sale has been approved – walk away from the transaction.
In a traditional sale the loss of one buyer is mostly no big loss as another can be found if the home abides by the rules of the market, but in a short sale there are time frames which when crossed result in severe consequences for the owner/seller.
When a buyer walks there is often little time left for another buyer to step in. At times the note holder will extend the foreclosure date, but they seem to be less willing to do that these days.
The reason I’m writing this is that, often, the buyer does not know of the consequences of their actions to other people. I know it’s a precarious market, these short sales, but they do get done and when there are competent people handling them it does not take too long. Sure you as the buyer must look our for your own interest, but it’s also not fair to put in a bunch of contracts knowing you’ll be buying only one of the many.
Per the contract you must disclose such an intent with multiple offers because it is a material matter to the seller and as hard as short sales can be there is no need to expand the seller’s distressed situation any more then it has to be.
In other words there are other people on the other end of the contract. Sure they may be doing a ‘strategic short sale’, but they may also be one of the many people who got laid off as a result of this Great Recession or they are in the current situation for other reasons not of their making.
Dec 27
Surge in emigration as economic downturn takes toll…
THE NUMBER of people moving to live in Australia, Canada, the US, New Zealand and Britain over the past year has increased sharply, reflecting a major surge in emigration due to the recession.
New figures show Irish citizens have received 21 per cent more long-term resident visas for Australia, 49 per cent more New Zealand resident visas and 33 per cent more US immigrant visas.
There has also been a 100 per cent increase in the number of Canadian work permits issued to Irish people and a significant increase in the number of similar visas issued for Australia. The number of people moving to Britain has risen by 2 per cent in 2010, which amounts to just under 1,000 Irish people moving to Britain every month to live.
The figures from five of the most popular destinations for Irish emigrants are in line with recent data from Central Statistics Office, showing 65,300 people emigrated in the year to April 2010, the highest number leaving the country since 1989.
Britain and Australia are the most popular destinations for Irish emigrants but there is also a major increase in the number of people moving to work in Canada.
In the first six months of 2010, Canada issued 3,077 work permits to Irish citizens, which is more than the 3,047 it issued during the whole of 2009. This corresponds with a steady rise in Irish workers in Canada recently: 2,959 in 2009; 2,617 in 2008; and 2,392 in 2007.
Australia has seen a similar increase in the issuing of permanent residence visas. In the year to the end of June 2010, 3,041 Irish people got migration programme visas (for highly skilled workers), up from 2,501 a year earlier. A separate visa programme, which enables Australian firms to sponsor workers on a temporary basis, is also experiencing a big increase in Irish applicants. In the five months to November 30th, some 2,290 people received these visas, compared to 3,370 for the whole of the previous 12-month period.
However, the number of holiday working visas issued to Irish citizens under 31 years for Australia fell to 14,833 in the year to June 30th, 2010, down significantly from a record high of 22,786 in the previous 12 months.
Liz O’Hagan, founder of the firm Australian Visa Specialists, said this probably reflected the fact that many young people had already been on the programme and were now looking for ways to get long-term Australian visas.
Britain has not experienced a dramatic upturn in immigration. Some 5,630 national insurance numbers were issued in the first six months of 2010, suggesting full-year figures will surpass the 11,050 people in 2009 and the 10,550 people in 2008.
The US issued 287 immigrant visas to Irish people in the year to end September 2010. This represents a 33 per cent increase on the figure in 2009, although it is so small a number it is almost irrelevant to the figures.
Some 1,637 people gained legal permanent resident status in the US in the year to end September 2009 but no figures are available yet for 2010. Some 14,444 non-immigrant visas, covering students work programmes, intra-company transfers and other temporary workers, were also issued in the year to end September 2010.
Irish immigrant groups also suggest there has been an increase in illegal emigration to the US.
The number of permanent resident visas issued by New Zealand to Irish people is up 49 per cent at 434 in the year to end June 2010. It has also issued 4,010 work visas to Irish people, up from 3,936 in the previous 12-month period.
Dr Alan Barrett, who co-ordinates the migration programme at the Economic and Social Research Institute, said the emigration figures reflected one of the most depressing aspects of the economic downturn. He said, given there are few job opportunities in Ireland, it was probably preferable that people went away to work elsewhere to maintain their skills.
“But regardless of these possible benefits, emigration that is involuntary is saddening and brings back sad memories for people of my generation who left college in the 1980s,” he said.
Report by JAMIE SMYTH – Irish Times
Useful links:
Guide to Moving to New Zealand
A case study of how a traditional home sales was completed in 23 days in a market inundated by bank owned and short sale homes.
In a market that’s basically focused purely on bank owned homes and short sales, traditional sales take a back seat, but they still sell. In this point of the market about % are traditional sales. The competition for the 6,000 or so buyers each month is pretty fierce.
The subject home was a traditional sale. In fact, the sellers were selling in order to move up: to buy a better larger more luxurious home at these low prices.
Their home sold at market price in 23 days while other homes, including many short sale and bank owned home in the same competitive market are still for sale months after the subject home sold. It could be luck, but luck can be manipulated or another way, you can create a situation where by luck has a great chance of striking you with a gift.
I happen to believe that that this ideal confluence of a seller – owner willing to do the work in preparation for the sale – listening to their agent, of proper pricing, a competitive price and marketing coupled with a presentation targeted toward a buyer group that happened to exist withing the market place.
So let’s go into some details on why this home sold in 23 days at 96% of asking price which was in the upper half of the market bounds.
Price
I mention price because it is often the most important factor. A property will sell at some point if the price is right, meaning that a home needs to match it’s target market and if it does it’s bound to sell. Often that’s a hard pill to swallow as it means a home that need fix up or is next to a noisy road or in a less desirable neighborhood or painted pink for that matter will go for a discounted price and the goal with the subject property was to not only sell, but sell at price that is as high as possible.
The price of this property was set appropriately up front. It’s often a bad idea to price high and expect buyers to ask for a discount. Often the home will simply be ignored and once the price is dropped much of the momentum of a new listing will be lost. If a home is priced right up front then the very important first 2-3 week period provide a high probability of an offer and most of the time a much better offer then one would receive once the days start adding up.
Preparations
In order to make the best presentation and match the asking price and the wants and needs of the market this home was targeting it needed to be in move in condition with no apparent work needed.
To that end the owners took our advice and carefully reviewed out suggestions for painting, repairs, presentation and staging. Before the home was perfect for the owners, but it could not stay as it was as the potential buyers would not see it in the same light as the owners.
The fact is that once a home goes on the market it becomes a produce and the product need to be one that is attractive to potential buyer.
What kind of preparation was involved? The seller did not want to do too much, not spend too much money so the basics were covered: any thing that looks like it will need taking care of was, like a slight stress crack on the ceiling for instance: most rooms were repainted, the carpet was stretched and cleaned as was the entire home and the rooms were made to look their purpose – a dining room was made into a dining room, a master bedroom once almost empty was made to look like a true master bedroom suite and so on. The result was a more vibrantly decorated home rooms that suggested their exact function and the staging helped make it not only visually appealing, but any buyers could easily see how they would function in the space.
Availability & Access
It’s always important to make access to a property as easy as possible. A vacant home is best, but of course that’s not always possible. Do everything possible not to hamper showing.
Reasonable expectations and approach to the process. If the price is set right as it was and the preparation is done then the natural course of the market will take it’s place, meaning that there are expected norms that will happen in the first 2-3 weeks if things are done right. If not then adjustments need to be quick or the property/product will stagnate on the market.
Once the offer was received the sellers were very reasonable. It’s not always easy to detach ones self personally and emotionally from the property and this lack of detachment can cloud judgement resulting in a hampered sale.
Marketing
And of course marketing is important. No matter how well it’s priced and prepared the home won’t sell if no one knows about it. Even if they know of the home, but all they see are just a few photos and/or bad photos then the effort will be wasted. We implemented a thorough marketing plan that showcased the best characteristics of the home and it’s location throughout the internet and the neighborhood resulting in a sale in 23 days at a price higher then expected.
Despite the many hurdles traditional sellers have, it is possible to sell a property well. It just takes proper preparation and research to best match the product to the buyer pool within a given time and market.
Thousands of horses and ponies abandoned in Irish countryside as financial crisis bites…
Tens of thousands of horses and ponies are believed to have been abandoned in the Irish countryside as families struggle to cope with the financial meltdown.
Animal welfare inspectors have had to shoot some of the worst affected animals left badly weakened by exposure, starvation, sickness and injury.
With costs of feeding or keeping the horses in stables running to £26 per day, generations who have kept horses as a passion have no longer been able to afford to keep them.
Irish Prime Minister Brian Cowen has pledged £12.8billion in spending cuts and tax increases over the next four years.
The austerity measures are expected to lead to a 10 per cent cut in the disposable income of Ireland’s middle class, and worse for those on lower incomes, leaving them without the funds to care for domestic pets.
Irish law requires owners to have animals registered and microchipped, but it is not rigidly enforced.
Thousands of people are thought to have invested in horses or ponies during the boom years in Ireland, fuelled by a property bubble in the country.
Reckless breeding has also seen the horse population soar rapidly.
Many were kept in gardens, fenced-off building sites or on common land.
But the global financial meltdown has led to them being left to wander in the countryside as owners are unable to pay for their upkeep.
Joe Collins, president of the Veterinary Council of Ireland, estimates there are between 10,000 and 20,000 ‘surplus horses’ across the country.
Ted Walsh, father of top steeplechase jockey Ruby Walsh, said that number could be as high as 100,000.
Thousands of the animals have been left to roam around the site of Dunsink tip, just miles from the centre of Dublin.
Many of them have been shot with a .32-calibre pistol by animal welfare inspectors as they were too weak to survive.
The Dublin Society for the Prevention of Cruelty to Animals has been forced to limit its stabling capacity in the hills around Dublin and slash its 0,000 budget for horses and ponies.
In 2008, it took in 26 sick or injured horses and ponies; last year that figure was 106, and so far it has cared for 115, according to the New York Times.
Some of the released animals are even recaptured and sold to unregulated horse markets for as little as £10 each.
Report – Daily Mail.
FF’s parting gift of corporate welfare will sink the country…
A farmer told me he had just taken €53,000 out of the local bank and put it under his bed
YESTERDAY was the feast of the Immaculate Conception. In many other Catholic countries, particularly in Belgium and southern Holland, this is also the week that Santa comes and leaves presents in children’s shoes. For many, both the Immaculate Conception and Santa Claus are simply not believable. For me as a child, December 8 was a day off school and that’s all that counted.
What would Christmas be without Santa, or Catholicism without the Immaculate Conception? You can’t have one without the other. Even if you don’t believe, sometimes it is easier to pretend.
The Budget was akin to the Government playing a big game of ‘let’s pretend’. Let’s pretend that the banks are solvent. Let’s pretend that the problem in Ireland is ‘social’ welfare rather than ‘corporate’ welfare (because this is what bailing out the banks amounts to) — welfare fraud by corporations. Let’s pretend that the Budget can make the economy grow. Let’s pretend that some other country has tried austerity without mass debt restructuring and succeeded. None of the above are true.
The problem with ‘let’s pretend’ games is that, when we are young, they allow a child’s imagination to flourish, with reality and fantasy crossing over, but when we become adults, we know it’s only a game. We also know, for example, that the reason no country has ever tried what we are doing — austerity budgets without debt restructuring — is that it doesn’t work. So why go through the charade?
The people know the Budget will not get us out of the hole, and they are voting with their pockets by taking money out of the banking system. The official response to this was, first, to deny it is happening and then to say it is all right because as quickly as our deposits leave, the ECB injects new cash into the banks and the net position stays the same. But this is a recipe for a banking collapse, as it implies that a banking system without deposits is a banking system; it is not.
For example, the other night, following a performance of ‘Outsiders’ at the lovely Backstage Theatre in Longford, a local farmer approached me tentatively. He mumbled for a bit, complained about the weather and abruptly told me that he had just taken €53,000 out of the local bank and put it under his bed (and being a farmer he had a shotgun by the bed). He didn’t solicit any advice as to whether this was a good or a bad thing to do; he just stated baldly his own personal conclusion about the banks, the economy and the financial affairs of the nation in general.
Either we fix the banks or this farmer’s approach will become commonplace and the establishment’s course of action that increasingly looks like national economic suicide or ‘patricide’ will continue.
The only part of the banking system that is currently working is clearing. Most deposits are still in the banks, cheques still clear, the ATMs still work. But that is it. The original guarantee prevented a run back then, but the problem has changed utterly since September 2008. It is now failing. The reason it is failing is that it was the right solution to the wrong problem.
The banks are insolvent. It is interesting that the conversation is now about comparing levels of insolvency. Bank of Ireland is quite insolvent, AIB is more insolvent and Anglo is completely bankrupt. The thing about solvency is that either you are or you are not. You can pay the bills or you can’t. None of our banks can pay their bills.
So, what is the solution? Let’s look at the numbers. In September 2010, when the guarantee expired, the banks had €55bn of bonds that they needed to roll over. The market, knowing that the banks were insolvent, said ‘no thanks’, so the ECB and Irish Central Bank stepped up to the plate and provided the liquidity the banks needed in order to open for business the following day.
To that €55bn we can add the €35bn the ECB had already provided in liquidity, giving us €90bn.
Then we can add the €34bn of special liquidity provided by the Irish Central Bank and we get €124bn. To resolve this mess, we have to look to the biggest holders of Irish bank debt: the ECB and the Irish Central Bank as well as the bondholders.
It should be very easy to convince Mr Trichet that allowing Ireland to go bust — as we surely will with the albatross of bank debt hanging around our neck — would be against the very raison d’etre of the ECB.
What is the biggest cause of runaway inflation in every country from Weimar Germany to Zimbabwe? A currency that people think is weak, and therefore don’t trust. The one thing that will weaken the euro is a sovereign default within its borders. It would turn into an existential crisis for the currency. There is no one willing to trust a currency whose continued existence is in doubt. Result? The euro plunges on the international market.
To stop this happening, the ECB has to sort out the Irish banking system in a way that does not lead to the people of Ireland being saddled with debts we cannot afford.
It should be fairly easy if there is a will to do it.
All deposits in Irish banks are held electronically. Ring fence these and move them to another institution. (This is not as odd as it sounds, it is exactly the plan Patrick Honohan outlined for the depositors in Anglo when he said that institution would be wound up by the end of January.) If a suitable institution does not exist, then we should create one.
The debts of the banking system can also be moved to the new institution, but the ECB would have to allow the money it is providing as liquidity to become capital in the bank. It would own, along with the other bondholders, 100pc of the shares in the new bank. As the property market here finally starts to clear, the bank could be sold to the private sector, fully capitalised and in good health.
Ireland is a systemic risk to the euro. We can deal with our own sovereign debt. We cannot deal with the debts of private institutions that went on a lending splurge to the private Irish banks for quick profits, nor should we.
If the ECB does not allow us to forego the bank debt, then it will reap what it is sowing. We will cause a crisis for the eurozone, and the demise of the very institution that has the power to save both itself and us.
The austerity Budget, without a deal on the banks, will lead to patricide. Corporate welfare, not social welfare, will sink this country. Will that be Fianna Fail’s legacy?
Article by David McWilliams – Irish Independent
A superb video presentation of activities to do in Scottdale, AZ
The city of Scottsdale has put out a rather nice video suggesting some of the many things one can do in Scottsdale and some in Phoenix, especially active things like an air balloon ride, a hike up Camelback Mountain or a visit to the Desert Botanical Gardens around Papago Park or the hundreds of miles of cycling routes the valley has and especially Scottsdale like on Hayden for road bikes or the surrounding desert and mountains for mountain bikes.
This winter weather, with 70+ degrees, to enjoy the desert valley. By the way, thanks to John at AZ Real Estate Notebook for putting me on to this great video with his post.
Toronto Income Property Newsletter
Happy Holidays everyone. I would like to wish all of you, your friends and family a very merry Christmas, Hanukkah, Kwaanza, Festivus (or whatever you celebrate) and a happy and prosperous new year. May all your hopes and dreams come to fruition in 2011. If you are travelling over the holidays, please be safe. Try not to eat too much holiday junk food and enjoy this time of year where we all get to see those who we care most about. I’ll be back to you on New Year’s Day where I’ll give you my forecasts for the Toronto residential income property market in 2011. All the best!
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In last month’s newsletter I talked about the new CREA agreement with the Canadian Competition Bureau and how this was going to open the door to more diversified buyers’ and sellers’ services in our industry. The time has come to re-examine commission based structures for those sellers who feel that they do not need the full-service approach that we all offer. These new MLS rules allow do-it-yourself sellers the opportunity to put their own contact information on their property listing and be contacted directly by interested parties as in a traditional “for sale by owner” model. The general public will not be granted access to MLS for the time being. All postings to the MLS system will still have to be entered by a licensed realtor.
I am pleased to announce that today we are launching a new flat fee 9 listing service. We will list your property on MLS, ensuring its accuracy and integrity and then you take care of everything else from that point on. You show your property, deal with potential buyers (and their agents) directly and ultimately negotiate and execute a contract.
A flat fee listing is ideally intended for those who have had some direct selling experience. Do-it-yourself sellers often have flexible schedules and ultimately feel that they can do honestly do the same (or better) job than a realtor who is going to charge them 2 or 2 ½ % of the sale price. My investor clients are always financially oriented and many tend to possess business and marketing backgrounds, so it will be a natural fit for some of them.
This service isn’t going to be the best selling alternative for everyone. Many sellers (especially of tenanted properties) will continue to need the full service approach, having all duties professionally performed from beginning to end by an experienced real estate professional.
For more information, please visit www.999dollarlisting.com. If you or any of any associates would like to chat more about how this service works in more detail, please feel free to send me an e-mail and I’ll be back in touch with you soon.
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The Toronto Real Estate Board reported 3,076 sales through the Multiple Listing Service during the first two weeks of November 2010. This represented a 16 per cent decrease compared to the 3,666 sales recorded during the same period in November 2009. Year-to-date sales amounted to 78,526 – up slightly from the 2009 total.
It is interesting that even though the number of sales declined, prices didn’t drop. In fact, they went up slightly. In the downtown core it seems like there is hardly any investment inventory at the moment, but that’s only because a year ago we were at the top of the market. When you have record breaking months, as we saw a year ago, where everyone is selling because the market is strong, eventually this has to subside. There are only so many people out there with duplexes to sell. Now a lot of sellers are being cautious and are waiting. There are still plenty of buyers out there though. When I start seeing cap rates that aren’t five point something, then I’ll believe that the demand has started to drop off. In the mean time, many buyers will still have to be patient for the right opportunity.
It’s a scandal, we’re still being screwed to pay bankers their bonuses…
This must be the final insult. In three days’ time, Brian Lenihan’s Budget will take a big chunk of money from every taxpayer in the country to bail out our failed banks.
Now we discover that those same banks have already been using public cash to pay their staff handsome bonuses and salary increases that will ensure they escape the worst of the pain.
Needless to say, this information has not been exactly been freely volunteered by the banks themselves. In fact, it has only emerged because the backbench Fianna Fail TD Chris Andrews put down a written Dail question on the issue last Wednesday.
A new opinion poll suggests that as few as 16 FF TDs could be returned in the coming general election — but Andrews’ willingness to confront his own Government’s policies suggests that if there’s any justice, he will be one of them. The evidence is clear.
Over the last two years, most workers have been forced to take pay cuts but AIB and Anglo Irish actually bumped up some staff salaries by 3.2pc and 5pc respectively.
This might seem like a generous gesture, until you remember that the Government was simultaneously pouring money into the banks’ coffers in order to pay for their leaders’ mistakes.
In the real world, bonuses are something that you only get if you’ve done a good job. It comes as something of a surprise, them, to discover that a grand total of 15 Anglo Irish staff members received these awards in 2009 and 2010.
Since Anglo is now one of the most pathetic basket cases the banking world has ever seen, we can only imagine how much worse things could be if these people hadn’t been doing such sterling work behind the scenes. It would be bad enough if the only people to benefit from these pay increases were frontline staff, who are at least innocent of the crimes and stupidity that have brought this country to its knees. Instead, it seems that banking executives are as keen as ever to stick their own snouts into the public trough.
Earlier this week a Central Bank report found that only one bank was making a real effort to reform its pay policies, while the others were still presiding over the Celtic Tiger culture of perks, bonuses and golden parachutes.
As the report points out, this greed mentality is also responsible for the toxic loans that eventually led to the national humiliation of last week’s IMF/EU bailout.
To put it very politely, most of us would be quite keen to see that not a red cent of this goes towards lining the pockets of banking executives.
Of the €35bn that has been earmarked for the banks, almost half will come from the National Pensions Reserve Fund — while the likes of Michael ‘Fingers’ Fingleton can retire on a gold-plated €27m pension that the law is apparently unable to touch.
Shocking
Since these people clearly don’t do shame, it is up to the Central Bank to put manners on them. While Patrick Honohan’s new regime seems to be a vast improvement on his predecessor’s, however, it is still far from clear that the straight-talking governor has the powers he needs to clean up this mess.
This week’s report even begs whistleblowers within the banks to expose any executives who may be overpaid, a shocking admission that the regulators are apparently unable to get this basic information for themselves.
Tuesday’s Budget will be yet another grim reminder of how the banking system has bled this country dry. It seems that no amount of taxpayers’ money, however, will make these financial institutions anything other than morally bankrupt.
Report – Evening Herald.
The Phoenix housing market sends mixed signals confusing even hardened analysts, but a few trends have emerged.
You’ve probably heard some news lately that housing is down again. Those were reports for the Case-Shiller Index which is always 3 months behind and yes, the prices were down as were sales, but we have more recent scrubbed numbers available and they point the a rather mixed market.
Let’s start off by mentioning seasonality. The graph below indicates sales each year since 2001 with the dark green highlighted as 2010. "October marked the beginning of what is typically the slowest time of the year for sales. Because of this, Guntermann projects that year-over-year declines will likely continue for the next several months." (ASU-RSI) Unlike most years 2001 had a huge bump up in sales through June.
This was the result of the home buyer’s tax credit. Following that the was a dramatic 35% drop in sales: that was expected. What else was expected was a gradual decline in sales as we see every year, heading toward the end of the year so there are no surprises there as well: expect lower sales and as a result of lower demand, probably softer prices, except that in 2010 November sales are about flat and possibly slightly higher then previous years. That may be a cause of some celebration, but these sales follow an unusual artificially induced drop, but it’s good news anyhow.
(All Graphs: Cromford Report – some modified by inPhoenix)
So in November 2010: 6,703 residential properties sold compared to 6,592 in October 2010 and only 4,322 in 2008, but 7,338 in 2009.
Active inventory, while slightly lower over last month is still on a tend up ever since the incentives ended. In other word the market is not able to absorb new inventory as it comes into the market, increasing days on the market, months of supply and putting a lot of pressure on prices.
A quick look at the prices per square foot reveals continues deterioration, though it’s every so slight compared to the utter destruction we saw in 2008 and somewhat in 2009.
Most of these numbers are noise: from month the month the numbers will change: it’s the trends that are more important, the heavy hitters within the market, like the tax credit last and early this year, like short sales and bank owned properties, like jobs and surprisingly less so interest rates.
A couple continuing trends to keep an eye on. Employment – so far it’s been 19 months of 9%+ of unemployment – official unemployment numbers – and until the job market improves it will be difficult to stabilize the housing market. It’s kind of a vicious circle: companies are shooting them selves in the foot by not hiring people, but we can’t expect individual companies to solve these issues. These are issues that need to be resolved collectively via our elected government.
"The recent improvement in Phoenix employment is an important step in getting the housing market back to some semblance of normal conditions but the process will continue through 2011 and beyond," Guntermann wrote in his October report. "The flow of foreclosures into the market is not likely to end soon so the added demand associated with job creation and the eventual increase in people moving to the Phoenix area may minimize the downward pressure on house prices going into 2011." (ASU-RSI)
Another trend is the continued influence of short sale and bank owned homes. It’s not really an influence as in complete leadership in the market. The distressed properties are THE MARKET and everything else follows suite; i.e. traditional sales.
58% of all active properties are distressed: 19.3% REO and 38.5% Pre-Foreclosure and a staggering 67% of sales are distressed. Compared the later to 63% last year and 70% in 2008.
There are some 90,000 properties that are either owned by the bank or may be so in the near future. That’s a big number and it will keep progress at bay.
And, at least for the near future those will stay at that distribution: 50-70% distressed sales. Plenty of those short sales are ending up foreclosed and lots of people are still either in the process of short selling or letting their home go or at least considering it.
On a more positive note there is a small move up movement out there. Move up buyer sellers are on the rise. These are people who are both selling their home and purchasing another. Sometimes the sale is at a loss compared to the price paid, but the purchase is equally discounted or more.
Another positive is people who had a short sale at least 2 years ago are starting to show up as active buyers. Yes, they are getting qualified for loans despite having a short sale. These are limited for now, but you should know that that is possible. In fact, lots of short sale sellers who were not late on their payments can often purchase properties right away.
Phoenix is still a growing city. Lots of new people are moving to it from all around the country, often for relocation with jobs waiting.
While still knee deep in a correction the mud is thickening so it looks like the market will be able to get some footing and proceed in a direction.
If this post has left you confused, don’t be. It’s an unruly market never seen before so even for the experts out there it’s difficult to piece it together into something that sticks together.