HOAs are generally created by the community builder, often as a requirement by cities and counties before necessary permits are issued for building to begin. A bill working its way through the state legislature would prohibit this requirement from being made by governmental entities. This bill would not bar communities from establishing a fully operational HOA that dictates landscaping requirements, housing color palettes, parking requirements, etc.  Builders, however, WILL now have a choice as to whether or not their communities will operate under an HOA and if so, the extent of control an HOA would have; as an example, an association set up strictly to maintain common areas with a requirement that all households contribute to the maintenance fund. The passage of this bill would be music to the ears of many home buyers who have been frustrated by the lack of new home communities that don’t have HOAs. These buyers currently have very little choice in new home construction, as the majority of new communities are under the control of HOAs as part of the licensing and permitting process the builders must go through.

There are several other very interesting events offered by the park in June. Check out their schedule and see if maybe a trip to the mountains is in your near future!

Average Sale Price May 2013 vs May 2012; $238,467/$203,411

Prices have increased a very healthy 17%+ since this time last year. This is not the almost breakneck increase we’ve seen in the recent past, but it is definitely a more long-term sustainable level of growth.

Historically low interest rates have been driving a lot of buyer activity, but recent word from the Federal Reserve may push even more buyers into the market. It’s being suggested that the Fed may ease up on their efforts to keep interest rates low, and many buyers who were on the fence about purchasing homes are deciding to act now before rates go up.

Add pirates to that picture, and you’ve got a rollicking good time! This Saturday, June 8 is Salt River Pirates Day. There will be entertainment (including the fascinating-sounding Pirate line dancers) and free goodies to the first 500 people. There’s even going to be a pirate costume contest with great prizes!

For more information, visit http://www.saltrivertubing.com/

Federal Reserve Chairman Ben Bernanke suggested recently that the Fed may start pulling back on their efforts to hold mortgage interest rates at historically low levels. In fact, interest rates, which have remained fairly stable for quite a while, have increased more in the past few weeks than they have in a long time.

Buyers, upon hearing that interest rates are creeping up, are in many cases responding by increasing their home buying efforts. Renters who have been waiting for a compelling reason to become homeowners are increasingly making the jump, adding to the already competitive pool of buyers vying for homes.

There is good reason to try to capitalize on interest rates before they increase. According to Loan Officer Dan Green with Waterstone Mortgage in Cincinatti, even a one percent increase in interest can translate into an over 10% drop in a buyer’s maximum price.

Although today’s interest rates are higher than they were a few weeks ago, they are still at practically bargain basement levels. Still, it can make a lot of sense for folks contemplating a home purchase to crunch the numbers and see if acting now may save them money in the long run.

These are just a few of the many Memorial Day events this Monday.

The City of Avondale, in conjunction with several military-related organizations, is hosting a Memorial Day Candlelight Service. There will be tributes, speeches and music in addition to the candlelight vigil. For more information visit http://avondale.org/Calendar.aspx?EID=5559

The Pioneer & Military Memorial Park in Phoenix AZ is hosting their 30^th Annual Memorial Day Observance. Visitors will have the opportunity to tour the cemetery and learn more about Arizona history. You can learn more at http://www.azhistcemeteries.org/

Metal theft is a huge headache for property owners, who frequently discover that metal fittings from their properties have been stripped and removed by thieves. Although most people consider this crime primarily one of commercial properties and large structures such as schools and churches, home owners are often the targets for these thieves. The copper coils in air conditioning units are favorite targets. Many a home owner has returned from vacation or other extended stay to find their air conditioners have been gutted, leaving them with the not-inconsiderable expense of repair or replacement. Vacant homes are frequently subject to even more expansive vandalism which includes ripping out interior walls to remove plumbing, electrical wiring and fixtures; anything metal is fair game to these thieves. As a Realtor, I have viewed many homes that had been stripped like this, and have had it happen with my own listings.

An Arizona law was passed recently that now requires scrap metal dealers to document the purchase (and the seller) of scrap metals such as copper. Now, anyone who wants to sell $25 or more of scrap metal (which doesn’t include recycled aluminum cans) will have to provide fingerprints, and the metal will be photographed. Scrap buyers who don’t follow these guidelines can be subject to hefty fines, loss of licenses and even jail time. Hopefully, this will cut down on the theft of metal and the destruction that often accompanies it.

For more information, click here.

For more information visit http://azmelonfestival.com

For more information visit livenation.com

Average Sale Price April 2013 vs April 2012; $227,687/$189,914

The number of homes on the market has increased from this time last year, with a greater number being non-distressed (ie short sale, foreclosure or auction.) In fact, last month saw the most non-distressed home sales since the height of the real estate bubble burst in 2006.

Despite an increase in listings being put on the market, buyers are still snapping the well-priced properties almost as soon as they are put on the market. Many of my listings are selling shortly after being put up for sale, and often with  multiple offers.

For more information, visit http://wetnwildphoenix.com

Many times sellers make home improvements with an eye on a possible payoff when they sell their homes. With the exception of the age of the house, all these features can be possible home improvement projects. But what is most interesting about this article is the cash value buyers place on these features. In most (if not all) cases, the premium that buyers place on a particular feature is less, and in some cases MUCH less, than the feature would cost as a home improvement project.

The take-away from this story for me is that it doesn’t always pay to make improvements to one’s home if the idea is to increase its sale price. Yes, a home owner can recoup some of the expenses incurred for remodeling their home, but the big payoff should be that it makes the home owner happy to have the improvements. Generally speaking, only a portion of the investment for home improvements are recouped when the home is sold, and this isn’t even always the case.

Visit http://www.glendaleaz.com/galleryglendale/index.cfm for more information.

Sellers have begun asking buyers to waive the appraisal contingency when they feel their homes will not appraise for the offer price. With competition so fierce for homes, and with prices going up so quickly, an increasing number of buyers are making the RISKY decision to accept the waiver. By waiving the appraisal contingency, the buyer is assuring the seller that s/he will pay the agreed upon price even if the appraisal comes in low, REGARDLESS OF HOW LOW, unless they stipulate upfront a maximum amount they will pay! This has several serious and potential devastating ramifications for buyers.

Lenders use appraisals to determine how much money they will lend. So, a buyer agreeing to waive the appraisal contingency is contractually obligated to come up with the money to pay the difference between the appraisal and their offer price. Obviously, the seller won’t care where that money comes from, but what if the buyer doesn’t HAVE the cash? Now, it’s not unusual for buyers to submit offers that include paying the difference between the appraised value and the offer value, but these offers are specifically worded so that the buyer agrees to a certain set amount of money that they are willing to come in the deal with, and they DO NOT WAIVE THE APPRAISAL CONTINGENCY! Waiving the appraisal contingency offers NO protection; the buyer will either have to come up with every penny of the difference or face accusations of breach of contract and the legal ramifications that brings. It is important to note that the appraisal contingency is not just about the value of the property, but the condition also. Many times appraisers note "conditions" in the appraisal. Depending on the type of financing these "conditions" will have to be corrected before the underwriter will FINAL approve the loan. If you waived the appraisal contingency, did you exclude the conditions?

The decision on whether or not a buyer wants to waive the protection they are offered by using a properly worded contract is ultimately up to that buyer, but as a Realtor I would never, EVER suggest that any of my clients waive the appraisal contingency. That bit of contractual language was added to our contracts for the specific purpose of protecting the buyer, and no home is worth the possibility of the risk of overpaying that waiving it can cause. Of course all things are relative, are we talking $1,000 or $20,000? Yes, we get requests for $20,000 waivers! Learn the lessons of 2005 and don't repeat them. If most buyers stick to their guns of abiding by the rules of the appraisal, then sellers will have less leverage in mandating buyers give up these rights. If you take the risk then accept the consequences.

Despite investors leaving our market, new waves of buyers are taking their places. Families who lost their homes to foreclosure or who short sold homes a few years ago are increasingly able to qualify for financing as their fiscal issues slip farther into the past. Folks who were holding off to see where the market would go are feeling pressure to buy before prices go up again. And, of course, those historically low interest rates are luring people back into the market.

Average Sale Price March 2013 vs March 2012; $221,791/$181,283

Phoenix area real estate is definitely a seller’s market, and the increasing prices are making it more attractive for prospective sellers to make the jump and put their homes up for sale. Most of my listings are selling within days of being put on the market, generally having received multiple offers. Buyers pounce on new listings as soon as the “For Sale” sign is hammered into the ground.

As we’ve seen here in Phoenix, investors are still driving the recovery. The report states that the number of first time home buyers is still critically low, but I suspect that a major factor is that the price range they are most interested in (around $150,000) is experiencing a critical shortage, with cash-toting investors are competing in the same price range. It’s not necessarily that there aren’t enough first time home buyers who WANT to buy a home, but they are facing mighty stiff competition. In fact, according to the news story, resale home inventory on a nationwide level hit a 13 year low in January of this year!

The critical shortage will likely start easing up a bit though. Prices have now recovered enough in the Phoenix AZ market that many sellers who formerly were upside down on their mortgages can now actually sell for a profit. We are seeing this already as the number of non-distressed (ie short sale, foreclosure & auction) listings are decreasing and the number of traditional ones are increasing.

For more information visit http://westgatecitycenter.com/bikenight/

The latest bit of brilliance coming out of the White House is a plan to urge banks to extend mortgages to buyers with weaker credit. After the whole real estate bubble burst and mortgage crisis, banks have become a lot more wary about how they determine who they’ll give mortgages to. Now, President Obama is urging banks to ease up on their hesitation and use a little “subjective judgment”, ie hunches, in order to make more families home owners.

To clarify; the folks that would be getting these loans DO qualify, but are on the lower end of the credit spectrum. They have the resources to pay a mortgage, but due to economic reasons (such as their credit taking a hit during the recession) are not considered an optimal risk to lenders. There is only so much money to go around, so of course banks are going to favor borrowers who stand in a strong financial position, which leaves these folks out of the market. As a Realtor, this makes me happy because more families qualifying for mortgages means more business. But as a taxpayer, there’s WAY too much to this plan that makes me angry.

First of all, guess who is going to back these loans? That’s right; you, me, and all the other American tax payers out there. Yes, these loans will be backed by the FHA with hopes that Fannie Mae and Freddie Mac will jump on the bandwagon too. If the borrowers default, you and I get the honor to pay for it.

The banks were found guilty of predatory lending and other irregularities in their lending practices when federal investigators reviewed the business after the mortgage crisis. Although much of the “punishment” doled out by regulators to the banking industry is a joke, it DID make them a little more careful about who they extend credit to. THIS time the feds are giving the industry a “get out of jail free” pass. Under this plan, if a loan meets FHA guidelines but the borrower defaults, the bank will not be punished or face legal action. So let’s get this straight; the banks will be allowed to use “subjective judgment” and, if the loan tanks, they won’t face any loss; FHA will just smile, say “you did a good job, we can’t win ‘em all” and hand over the loan guarantee money to the bank. And we taxpayers just bought another foreclosed house. Haven’t we bought enough of those?

This whole plan smacks of a repeat of the entire real estate bubble and subsequent mortgage crisis, but this time it is explicitly supported by Capitol Hill. Maybe they should spend more time trying to fix what’s broken in the government before trying to fix what isn’t broken in real estate.

For more information, visit http://www.neonsplashdash.com/locations/scottsdale-az-2013/

There ARE a few surprises that have cropped up though. Although many big investors have left the Phoenix area, there still is keen investor interest in our real estate despite the increasing prices and decreasing rent rates. They are still providing intense competition for an increasing number of home buyers wanting to capitalize on low interest rates and still-affordable (but ever increasing) home prices. Home buyers looking for move-in ready properties around $150,000 are discovering that investors are still formidable competition for the same kinds of properties.

And this leaves an awful lot of sellers grinning from ear to ear. Despite consistently increasing prices, buyers are still in the game, and in increasing numbers which simply puts even more upward pressure on prices. Spirited bidding wars are still quite common, as is homes ultimately selling for above their listing price.

Although it might seem counter-intuitive, this seller’s market situation can be good news for buyers hungry for more inventory. Many home owners are finding they are no longer underwater on their mortgages and are now considering selling. Although investor interest is still high, the increasing prices are luring many to sell properties they bought when the market was at its most depressed. It’s a win-win situation for everyone involved!