Mohave Valley Daily news quoted me in todays paper. As always Team Fahey is out infront spreading the news to assist home buyers and sellers achieve their real estate dreams. Here is the article that was in todays paper.
Thursday, February 11, 2010 1:45 AM CST
Realtor: ‘There’s a lot of people buying homes in Bullhead right now’
By DANIEL CALLAHAN/The Daily News
By DANIEL CALLAHAN
The Daily News
BULLHEAD CITY — Bullhead City Realtors saw a different fourth quarter than was expected.
In general, the area’s real estate market builds through the first and second quarter, crests into the third quarter and drops off in the fourth quarter.
This was not the case in 2009.
“This quarter was just crazy,” said Tamra Sprague, broker with Premier Executives Real Estate in Bullhead City.
December, she said, was a good month for residential home sales.
“For me it was,” she said, “and for a lot of my agents.”
According to Evan Fuchs, broker at Bullhead/Laughlin Realty, December was one of the biggest months of 2009 in terms of sales.
Bullhead City saw a nearly 66 percent year-over-year increase in homes sold. In December, about 78 homes were sold, compared with 47 in December 2008 and 32 in December 2007, according to the WARDEX multiple listing service.
“That’s a big deal,” said Fuchs.
The dramatic increase in sales carried into January as well with 58 homes sold, compared to 45 in January 2009. While the difference may not seem significant, it’s a positive sign because it shows more homeowners are selling their properties instead of banks selling foreclosures. Of the homes sold in January, around 45 percent were foreclosures.
“There’s a lot of people buying homes in Bullhead right now,” said Petra Fahey, Realtor/owner at Country Ranch GMAC Real Estate.
Fahey said that while sales were up, prices were still tough, as well as the overall number of homes under contract. This January, 128 homes were under contract by the end of the month. Last year, January saw only 84.
As of Tuesday, Fuchs estimated the Bullhead City market to be carrying a 10.3-month supply of homes, a drop from the 14-month supply in January 2009.
A six-month supply generally is seen as a balanced market, said Fuchs. With the current 10.3-month supply, it’s still a buyers’ market.
“It’s important to understand that supply drives price,” said Fuchs via e-mail. “When the inventory shot up in 2006, it put us on course for a 21.5-month supply in 2008 as demand — and prices — plummeted.”
A good indicator of what’s going on in the market can be seen in the inventory and what segment of that inventory is selling or not selling.
Buyers have to remember, Fuchs said, that there really is no national real estate market; all markets are local. Within those local markets there are also “micro-markets” or market segments, which can point to areas that are having a large effect on the overall local market.
According to Fuchs, “Manufactured homes is where the market is sick.”
Manufactured homes account for a large portion of the overall inventory. The effect of low prices and a high number of manufactured homes is slowing sales in that segment.
“Because manufactured homes represent almost half of the inventory, it has a large effect,” said Fuchs. Manufactured homes make up approximately 47 percent of the active inventory.
“When the price of site-built homes fell, due in large part to the willingness of banks to meet the demand of the market, it put great pressure on manufactured homes,” said Fuchs. “If the price difference between a site-built home and a manufactured home is small enough, buyers will jump to the site-built home.
“The result is a clear separation of markets.”
Fuchs is quick to emphasise that just because the manufactured homes section is under-performing, it doesn’t mean the overall Bullhead market hasn’t seen vast improvements over the last two years.
“If you take away under-performing sections, you can see what the market’s really doing,” said Fuchs.
Also of note is the federal tax credit available to first-time home buyers. The program, which essentially grants a tax credit to home buyers who fit certain requirements, originally was introduced as part of the House and Economic Recovery Act of 2008. It was expanded as part of the American Recovery and Investment Act of 2009, but was set to expire at the end of November of this year. On Nov. 6, The Worker, Homeownership, and Business Assistance Act of 2009 was signed into law and expanded the program once again.
Under the revised program, first-time home buyers may be eligible for a tax credit of 10 percent of the purchase price up to $8,000. “Move up” buyers, or those who have been in their homes for five consecutive of the last eight years could be eligible for a tax credit of 10 percent of the purchase price up to $6,500.
The revisions also placed the maximum purchase price at $800,000 and set new dates for the expiration of the program. The credit applies to home purchases under contract by April 30, 2010, and closed escrow by June 30, 2010.
There also are new income restrictions. If the homeowner stays in the home for three years, the money does not have to be repaid and the credit can be claimed on either the 2009 or 2010 tax returns.
Because it is ending soon, “now is the time, for sure,” said Fuchs, for prospective home buyers to take advantage of the program.
Fahey had a similar view: “For sure, yes, yes yes,” now is the time to take advantage of the program. Some people, she said, may be kicking themselves later for expecting another extension of the program.
“The bulk of the homes sold were under the $150,000 price tag,” said Fahey in a statement. “That’s the perfect price range to the first-time buyers trying to take advantage of the $8,000 tax credit.”
“I’m hopeful we’ll see continued sales,” she said, noting that there will still be good inventory, good selection and good pricing even after the tax credit concludes.
Short sales
The practice of short selling a distressed property has seen a resurgence recently as lenders and banks are more willing to negotiate with homeowners who are unable to keep up with their payments. A short sale can take place when a homeowner is “short,” or owes more on a property than the property is worth. The homeowner then negotiates with the mortgage company to accept less than the full balance of the loan at closing. A buyer closes on the property and the property is sold “short.”
Tamra Sprague, broker with Premier Executives Real Estate, said short sales, while not the best choice for everyone, allow a homeowner to get out from under a home they no longer can afford, save their credit and expedite eligibility to purchase a new home.
The process, however, is not necessarily easy. According to Petra Fahey, owner/Realtor with Country Ranch GMAC Real Estate in Bullhead City, a homeowner must be able to prove financial hardship and insolvency, find a buyer and negotiate a price. The lender must approve the short sale before it can proceed.
According to the Distressed Property Institute, if a homeowner can successfully negotiate a short sale with the lender, the effect on the homeowner’s credit score and credit history are far less destructive than a foreclosure. Additionally, a short sale does not have to be declared on a mortgage application. Similarly, eligibility for future loans also comes about much more quickly — two years instead of five.
It’s also more cost effective for a bank or lender to short sell a property, said Sprague, rather than foreclose on a home.
“They’re definitely not wanting to foreclose,” said Fahey, of banks and mortgage lenders, making the possibility of a short sale much more realistic for many underwater homeowners.
“Always consult an Arizona real estate attorney and an accountant before proceeding,” advised Fahey.
To find a Certified Distressed Property Expert in your area, visit www.cdpe.com.
Avg. Sales Price: 12500
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