Scottsdale Arizona Real Estate Blog

The Business Journal of Phoenix – June 20, 2007

 It’s no surprise that economic forecasters expect a drop in single-family housing permits this year, but they also predict a rebound beginning in 2008.

The Greater Phoenix Blue Chip real estate panel forecasts a 13 percent drop in permits to 37,000 for 2007. In 2008 they foresee a 10 percent increase, bringing the number back up around 40,000, according to the latest edition of the Blue Chip Economic Forecast, published by the W.P. Carey School of Business at Arizona State University.

However, there is some uncertainty to the forecast, writes topics editor Elliot Pollack. He notes a wide spread in predictions among panelists from a low of 27,000 permits for 2007 to a high of 48,000.

“The single-family residential market weakened considerably late in 2006 but recently picked up again,” Pollack wrote. “It remains to be seen if this is an aberration or if the worst is over.”

Associated Press
Jun. 27, 2007 03:20 PM  NEW YORK – If your house is flooded during a hurricane, is the damage covered by your homeowners insurance policy? Will it cover a motor scooter stolen from the backyard? Or your son’s possessions when he moves into his college dormitory?

The answer to all those questions is generally “no,” though a surprising number of homeowners don’t know that, according to a study by the National Association of Insurance Commissioners. That means many homeowners may not be carrying the right insurance to protect themselves from storms, fire and other perils.

The association, which represents state insurance regulators, asked nearly 700 homeowners who carry insurance about their policies and found widespread misunderstanding about what’s covered and what isn’t.

“We were surprised at some of the misperceptions,” said Cathy Weatherford, NAIC’s chief executive officer. “But it will help us create better consumer education programs.”

The study found that despite all the media coverage of Hurricane Katrina and its aftermath, one-third of those surveyed incorrectly believe flood damages would be covered by standard homeowners insurance policies.

“After so many reports from New Orleans about flood damage not being covered, about homeowners unable to collect, I would have thought all of us would have gone back to check with our insurance companies and our agents,” Weatherford said.

While most homeowners polices cover rain damage, most specifically exclude flood damage. But flood coverage is available separately through the National Flood Insurance Program, which can provide protection for up to $250,000 for the structure of a home and $100,000 for contents. The flood policies, which are sold by insurance agents, also can be purchased by renters to cover up to $100,000 of their belongings.

Homeowners policies also routinely exclude earthquake damage, which requires special coverage through state-sponsored entities such as the California Earthquake Authority or riders offered by some private companies.

Another misconception held by more than two-thirds of policyholders is the belief that cars, boats or motorcycles stolen from their property or damaged on their property are covered by homeowners policies, Weatherford said.

“They figure that if they’re in the garage or in the back yard and a tree falls on them, their homeowners (policy) covers it,” she said. “In fact, vehicle coverage covers vehicles, homeowners coverage covers the home and outbuildings.”

As for the son heading off to college, his property in the dorm likely won’t be covered by his parents’ policy so the family should consider purchasing separate coverage, NAIC said.

A recent MetLife survey of some 1,200 homeowners and renters also found confusion about insurance coverage.

“There were a lot more incorrect and not sure’ answers than we would like to see,” said Matthew Cullina, director of product management for MetLife Auto & Home, which is based in Warwick, R.I.

The MetLife study found that nearly one-third of those surveyed believe their homeowners policy would reimburse them for the market value of their homes if they were destroyed by fire or in a storm.

In fact, the payout will reflect the cost of rebuilding, also known as replacement cost. It’s generally capped at a lot less than the market value because it doesn’t take the cost of the land into consideration, Cullina said.

A homeowner can determine a rough replacement cost equivalent by “asking a contractor in your area the cost per square foot for building a home” and running the calculation for your own residence.

Meanwhile, some 72 percent of those surveyed said they expected their insurance to cover the full cost to replace personal belongings destroyed in a fire or natural disaster.

When it comes to contents, the standard homeowners policy covers actual cash value, which is the cost of an item minus depreciation, Cullina said.

“You have to ask for replacement cost coverage, but I think it’s worth the extra money,” he said. Replacement cost is today’s market value, without deducting for depreciation.

Homeowners also need to think about coverage for special items, such as jewelry and fur and fine art and heirlooms, he added.

Most policies put limits on payouts for special items like these, Cullina said.

“If you’ve got something special, say your grandparents silver, and it’s valuable, you may want to get a rider” to cover the items, he said. Often such items must be appraised by a professional, and the customer and insurance company reach an “agreed value” for coverage, he said.

Cullina suggested that consumers “do some research online” to educate themselves about coverage. He also suggests they ask insurance agents “What isn’t covered? Where are the gaps?” so they know what extra protection is needed.

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Arizona’s cities

Arizona’s biggest cities and where they rank nationwide behind No. 1 New York.

1. New York: 8.2 million people.

5. Phoenix: 1.5 million.

32. Tucson: 518,950.

38. Mesa: 447,500.

72. Glendale: 246,500.

76. Chandler: 240,595.

78. Scottsdale: 231,000.

115. Gilbert: 191,500.

Source: U.S. Census Bureau 2006

By The Associated Press

PHOENIX — Phoenix has elbowed out the City of Brotherly Love to become the fifth most populous city in the nation and one of six Arizona cities to make the top 100 list.

The U.S. Census Bureau estimates the desert city now has more than 1.5 million residents, edging out Philadelphia by more than 64,000 people.

And with more than 43,000 new residents between 2005 and 2006, The Census Bureau says Phoenix’s population increased more than any other city in the country.

New York City, Los Angeles and Chicago had the biggest populations. Phoenix is fifth behind Houston, which had 2.1 million people, or about 600,000 more than Phoenix.

(Copyright 2007 by The Associated Press. All Rights Reserved.)

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Jun. 26, 2007 01:16 PM

 A senior vice president of the Ellman Companies, a managing director of a data center, an owner of a rebar, wood-stakes and concrete accessory company and an orthopedic specialist in sports medicine are among the buyers and sellers in this weeks done deals.

$5,200,000
Timothy R. Wright of Tempe purchased this 6,455 square-foot home at Adobe Ranch in Paradise Valley west of McCormick Ranch Golf Club. Timothy Wright is senior vice president of real estate operations for The Ellman Companies in Phoenix. The home was sold by Donald B. Roberts of Paradise Valley.

$3,400,000
Alyse K. Wanger of Scottsdale paid cash for a 2,507 square-foot home at Doubletree Estates in Paradise Valley on the north side of Camelback Golf Club. Alyse Wanger’s husband, Anthony Wanger, is managing director of Sterling Network Services in Phoenix, a provider of data center and collocation services which was bought by Digital Realty Trust Inc., an owner and manager of corporate data centers and Internet gateways, last year. The facility occupies the old Arizona Republic building on 2nd and Van Buren streets in downtown Phoenix. The home was sold by Sunnyvale Development, a Wisconsin Limited Liability Company.

 $3,150,000
Robert H. Bennett Sr. and Marilyn Jo Bennett, as Trustees of the Robert Hamilton Bennett Sr. and Marilyn Jo Bennett Family Trust, purchased a 6,713 square-foot home on a Clearview Edition lot in Paradise Valley southwest of the Paradise Valley Country Club. Robert Bennett Sr. heads, Nina Construction Supply, solely owned by the Robert Bennett Family Trust. The company is a supplier of rebar, wood-stakes and concrete accessories located in four locations throughout Metro Phoenix area. The home was sold by Russell P. Chick and Suzanne E. Chick, as Trustees of the Chick Family Trust. Russell Chick, MD, is an orthopedic specialist in sports medicine in Phoenix.

$2,995,000
Lisa A. Bentley purchased a 2,715 square-foot home at Paradise Highlands Estates in Paradise Valley west of the Paradise Valley Country Club. The home was sold by DCS Home Investments, an Arizona Limited Liability Company, whose sole member is Douglas C. Sandahl. He is the owner of the Greer Lodge Resort in Greer who sold another home in Paradise Valley in April for $3.75 million.

$2,815,000
Paul H. Gulstrand and Julie P. Gulstrand of Eden Prairie, Minnesota, as Trustees of the Julie Gulstrand Trust, bought a 4,059 square-foot home at Desert Mountain in Scottsdale northwest of the Desert Mountain-Cochise Golf Course. Paul Gulstrand was CEO of Minnesota United HalthCare Insurance Co. and CEO and president of Unimerica Workplace Benefits in Golden Valley, Minn. The home was sold by Ernest W. Townsend and Barbara L. Townsend of Tustin, Calif., as Trustees of the Townsend Family Trust. The Townsends purchased the house in January for $3.59 million.  

If you are looking for real estate in Arizona you might also want to check out these communities: 

Whisper Rock

Troon North 

The Boulders 

Jun. 20, 2007 12:00 AM A former president of mining company Asarco, the president of a wholesale electric company and a president of an architectural and engineering company are among the buyers and sellers in this week’s priciest home sales.

$4,035,000

Nesting in Arizona LLC, a Delaware limited liability company, paid cash for a 6,935-square-foot home with 800-square-foot pool built in 2001 at Indian Bend Vistas in Paradise Valley east of Paradise Valley Country Club. The home was sold by Robert D. Brannon as trustee of the Robert D. Brannon Trust.

$2,900,000

Ian A. Scott and his wife, Amy, and Harold Scott and his wife, Linda, purchased a 4,673-square-foot home with 600-square-foot pool built in 1998 in Paradise Valley northeast of the Arizona Biltmore Golf Course. The home was sold by Genaro Larrea and his wife, Monica, of Mexico City. Genaro Larrea is a former president of Asarco Inc., a miner, smelter and refiner of copper. Key Arizona copper mines include the Mission, Silver Bell and the Ray.

$2,850,000

David M. Jensen and his wife, Janet, of Potomac, Md., bought a new home in DC Ranch in Scottsdale on the southwestern corner of the Silverleaf Club. The home was sold by Casitas at Silverleaf LLC of Scottsdale.

$2,600,000

Scott L. Tonn of Scottsdale purchased a 5,779-square-foot home with 650-square-foot pool built in 1992 in Paradise Valley on the west side of the Camelback Golf Club. Tonn is president of Essco Wholesale Electric, a commercial and residential electrical contractor supply house with headquarters in Chandler. The home was sold by Kurt D. Reed and Marye L. Reed as trustees of the Kurt and Marye Reed Family Trust. Kurt Reed is president of Kurt D. Reed Associates Inc., an architectural and engineering firm in Scottsdale.

$2,200,000

William R. Rue and his wife, Diane, of Libertyville, Ill., purchased a new home in Pinnacle Canyon at Troon North on the south end of Troon North-Monument Golf Course in Scottsdale. William Rue retired in October as president, chief operating officer and director of Salton Inc. in Lake Forest, Ill. Salton Inc. is a designer, marketer and distributor of small appliances, home decor and personal care products. The home was sold by Red Moon Development and Construction Inc. of Scottsdale.

Associated Press

NEW YORK – Slumping home sales and drooping prices haven’t diminished homeowner optimism about their own nest egg’s value, a recent survey shows. The survey by Boston Consulting Group showed 55 percent of Americans believe they could sell their house for more money now than a year ago, down slightly from the 59 percent who felt that way last summer.

Nearly three-quarters think they could sell their homes within the next six months at a price they set, and 63 percent feel that real estate is a good or excellent investment.

The positive sentiment comes in spite of housing data that shows a downturn in real estate. Last month, the National Association of Realtors said sales of existing homes dropped by 2.6 percent in April to a seasonally adjusted annual rate of 5.99 million units, the slowest sales pace in nearly four years.The median price of a home fell to $220,900, an 0.8 percent decline from the median price a year ago. The trade group is expected to report May’s existing home sales Monday.

“Americans believe their homes are still their best investment. They’re positive about their homes’ value and believe in a bounce-back in residential real estate overall,” said Boston Consulting Senior Partner Michael J. Silverstein. “Talk of declining average values of homes is not forcing a cutback in spending. It’s just not translated into the American psyche.”

Instead, the survey showed that 69 percent of homeowners said they’re likely to make renovations or improvements to their homes in the next year, and more than two-thirds said the current housing market has no effect on their spending.

However, most Americans aren’t planning to buy a new home any time soon. Only 27 percent said they’re likely to purchase a house in the next five years.

Boston Consulting polled 1,007 adult Americans in a telephone survey from May 31 to June 3. The survey has a sampling error margin of plus or minus 3 percentage points. 

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Associated Press
Jun. 25, 2007 07:08 AM  WASHINGTON – Reflecting further housing troubles, sales of existing homes fell in May to the lowest level in four years while the median home price dropped for a record 10th consecutive month.

The National Association of Realtors reported Monday that sales of existing single-family homes and condominiums dropped by 0.3 percent to 5.99 million units in May, the slowest sales pace since June of 2003.

The median price of a home sold last month dropped to $223,700, down 2.1 percent from a year ago. It marked the 10th straight price decline compared with a year ago, the longest stretch of weakness on record.

The sales decline reflected weakness in the South, where sales dropped by 3.4 percent, and the West, where sales were down by 0.8 percent.

Sales actually showed strength in the Northeast, rising by 5.8 percent, and the Midwest, where they were up 0.7 percent.

In a troubling sign for the future, the inventory of unsold homes rose by 5 percent to 4.43 million units in May, a level that would take 8.9 months to clear out at the May sales pace. That is the highest inventory level since the last deep slump in housing in 1992.

Analysts said housing is being hurt currently by high inventories and the recent crisis in subprime mortgages, which has caused lenders to tighten up on their  

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