Archive for April 15th, 2010

AZ Central – Scottsdale home sales highest in nearly 5 years

Published April 15, 2010 Blogroll , Scottsdale Real Estate Leave a Comment

by Peter Corbett – Apr. 14, 2010 09:51 AM
The Arizona Republic

Scottsdale home sales spiked in March to their highest level in nearly five years as short sales, foreclosures and fix-and-flip foreclosed properties boosted the market.

Home sales and foreclosures were up just under 80 percent from a year ago, according to the latest monthly report from Arizona State University Realty Studies.

Scottsdale’s median price of $370,000 was down 1.3 percent from March 2009 but it was one of the smallest declines in years.

The median price flattened out, but foreclosures and short sales brought down the average price per square foot, said Fletcher Wilcox, a Grand Canyon Title Agency vice president who analyzes the local housing market.

“Prices are going to be challenged in the upper end of the market,” Wilcox said, adding that the sale of larger homes pulled up the median price in Scottsdale in March.

Foreclosures accounted for 28 percent of the March home deals in Scottsdale, according to the ASU report. The foreclosure rate is 40 percent Valley-wide.

The Valley’s median price in March for traditional sales was $142,500, up 12 percent.

Scottsdale home sales have not been this high since September 2005 when 660 properties were sold. The median price then was $540,000.

Wilcox and Scottsdale Realtor Gary Holloway of Zip Realty said that a growing segment of the market was from foreclosed homes that investors bought, refurbished and then quickly sold for a modest profit.

“They’re picking them up so cheap . . . and they can make 10 percent to 15 or 20 percent,” Wilcox said.

Holloway said buyers often snap up the fix-and-flip homes after seeing foreclosed homes that have been trashed by delinquent buyers.

“There is kind of a frenzy” for some of the lower-priced fix-and-flip homes with multiple offers above the asking price, he said.

Holloway says there are still a lot of problems with lenders dragging their feet on approving short sales.

Still, deals are getting done. About 15 percent of the single-family homes sold in Scottsdale in March were short sales, Wilcox said.

His analysis of the Multiple Listing Service data also showed that there is less than a four-month supply of Scottsdale homes priced below $400,000. It jumps to more than five months for homes priced from $400,000 to $600,000.

A six-month supply of homes is generally considered a balanced market.

In Scottsdale, there is a 16-month supply of homes costing $700,000 to $800,000 and $1 million to $2 million.

“Larger homes are stuck on the market, and the price is going to come down,” Wilcox said, adding that sellers are discouraged.

Buyers, meanwhile, are nervous and confused by the market, Holloway said.

“They’re afraid,” he said. “They don’t want to be like all the people they read about who got hurt before.”

And on the other side of it, “everybody wants to be able to brag” that they got a great deal, Holloway said.

Banking execs skeptical on mortgage reductions

Published April 15, 2010 Blogroll Leave a Comment

by ALAN ZIBEL – Apr. 13, 2010 11:13 AM
AP Real Estate Writer

WASHINGTON – Top banking industry executives are skeptical about helping troubled borrowers by forgiving a portion of their debt.

The executives told lawmakers on Tuesday they are reducing the amount that troubled borrowers owe on their home loans only in limited cases. That’s because consumers who are paying their mortgages on time are likely to see such reductions as unfair, the executive said.

David Lowman, chief executive of JPMorgan Chase’s mortgage business, told the House Financial Services Committee that large-scale mortgage principal reduction “could be harmful to consumers, investors and future mortgage market conditions.”

Chase estimates that reducing home loan balances so that no homeowners would owe more than the value of their homes would cost up to $900 billion, with $150 billion of that borne by the government.

Such programs “could raise issues of fairness,” agreed Sanjiv Das, Citigroup’s top mortgage executive. The pair appeared in front of the Senate committee with top executives from Bank of America and Wells Fargo & Co.

The four mortgage companies are the largest in the country and have come under fire for not doing enough to help borrowers as part of the Obama administration’s $75 billion mortgage relief program, which has failed to make a big dent in the problem.

Only 170,000 homeowners have completed loan modifications out of 1.1 million who began the program over the past year.

Democrats blame the industry. But Republicans say the Obama administration should abandon the effort and focus on creating jobs.

“The market needs to find its own footing free of government intervention and manipulation so we can revive our economy and get on with a full housing market recovery,” said Rep. Spencer Bachus of Alabama, the committee’s senior Republican.

Last month, the Obama administration launched a plan to reduce the amount some troubled borrowers owe on their home loans and give jobless homeowners a temporary break. Administration officials cautioned that the plan won’t stop all foreclosures or help all troubled homeowners. Instead, they say it will help the Obama administration meet their original target, announced last year, of helping 3 million to 4 million borrowers avoid foreclosure.

The four big banks at Tuesday’s hearing are also the main holders of second mortgages such as home equity loans. During the housing boom, business boomed for so-called “piggyback” mortgages – second loans that allowed consumers to make a little or no down payment.

These loans may be worth little or nothing, but banks are reluctant to release their claims or reduce the value of those loans on their books. Complicating matters, many borrowers are choosing to pay their second mortgages ahead of their primary ones. So banks have little incentive to modify those loans as long as homeowners are still paying on time.

The Treasury Department has launched a program to modify second mortgages. That program was delayed for months but the four big banks signed on after pressure from the Obama administration and lawmakers.

www.theholmgroupaz.com

Associated Press – Foreclosure rates surge, biggest jump in 5 years

Published April 15, 2010 Blogroll , Real Estate , Real Estate Articles Leave a Comment

Apr. 15, 2010 09:22 AM
Associated Press

LOS ANGELES – A record number of U.S. homes were lost to foreclosure in the first three months of this year, a sign banks are starting to wade through the backlog of troubled home loans at a faster pace, according to a new report.

RealtyTrac Inc. said Thursday that the number of U.S. homes taken over by banks jumped 35 percent in the first quarter from a year ago. In addition, households facing foreclosure grew 16 percent in the same period and 7 percent from the last three months of 2009.

More homes were taken over by banks and scheduled for a foreclosure sale than in any quarter going back to at least January 2005, when RealtyTrac began reporting the data, the firm said.

“We’re right now on pace to see more than 1 million bank repossessions this year,” said Rick Sharga, a RealtyTrac senior vice president.

Foreclosures began to ease last year as banks came under pressure from the Obama administration to modify home loans for troubled borrowers. In addition, some states enacted foreclosure moratoriums in hopes of giving homeowners behind in payments time to catch up. And in many cases, banks have had trouble coping with how to handle the glut of problem loans.

These factors have helped slow the pace of foreclosures, but now that trend appears to be reversing.

“We’re finally seeing the banks start to process the inventory that has been in foreclosure, but delayed in processing,” Sharga said. “We expect the pace to accelerate as the year goes on.”

In all, more than 900,000 households, or one in every 138 homes, received a foreclosure-related notice, RealtyTrac said. The firm based in Irvine, Calif., tracks notices for defaults, scheduled home auctions and home repossessions.

Homeowners continue to fall behind on payments because they’ve lost their job or seen their mortgage payment rise due to an interest-rate reset. Many are unable to refinance because they now owe more on their loan than their home is worth.

The Obama administration’s $75 billion foreclosure prevention program has only been able to help a small fraction of troubled homeowners.

About 231,000 homeowners have completed loan modifications as part of the Obama administration’s flagship foreclosure prevention program through March. That’s about 21 percent of the 1.2 million borrowers who began the program over the past year.

But another 158,000 homeowners who signed up have dropped out — either because they didn’t make payments or failed to return the necessary documents. That’s up from about 90,000 just a month earlier.

Last month, the administration expanded the program, launching a plan to reduce the amount some troubled borrowers owe on their home loans and give jobless homeowners a temporary break. But the details of those programs are expected to take months to work out.

The states with the highest foreclosure rates in the first quarter were Nevada, Arizona, Florida and California, with Nevada leading the pack, RealtyTrac said.

Rising home prices and speculation fueled a wave of home construction there during the housing boom. But now the state, particularly around the Las Vegas metropolitan area, is saddled with a glut of unsold homes.

Still, the number of homes in Nevada that received a foreclosure filing dropped 16 percent from the first quarter last year.

All told, one in every 33 homes in Nevada was facing foreclosure, more than four times the national average, RealtyTrac said.

Foreclosure filings rose on an annual and quarterly basis in Arizona, however.

One in every 49 homes there received a foreclosure-related notice during the quarter.

Florida, meanwhile, posted the third-highest foreclosure rate with one out of every 57 properties receiving a foreclosure filing.

California accounted for the biggest slice overall of homes facing foreclosure — roughly 23 percent of the nation’s total. One in every 62 properties received a foreclosure filing in the first quarter.

AZ Central – Talking Stick Resort and Casino ready to welcome gamblers

Published April 15, 2010 Blogroll , Real Estate , Real Estate Articles , Scottsdale Real Estate Leave a Comment

by Peter Corbett – Apr. 15, 2010 12:00 AM
The Arizona Republic

Sometime around dawn, the 15-story Talking Stick Resort is scheduled to welcome gamblers to the Valley’s largest casino hotel.

The Salt River Pima-Maricopa Indian Community is completing a $440 million project with a 240,000-square-foot Casino Arizona

gambling hall. Players can try their luck at 800 slot machines and 50 tables of blackjack, poker and other card games.

Talking Stick will add close to 500 rooms to metro Phoenix’s inventory of more than 60,000 rooms at a time when tourism demand remains stunted by the economy.

But resort executives are optimistic that they are entering the hospitality market with a great product at the end of a two-year slump.

“We’re seeing the country coming out of the recession,” said Russ Burbank, Casino Arizona chief operating officer. “We can take the Valley out of the funk and bring it back.”

To do that, Talking Stick has put together a lodging and entertainment package that rivals Scottsdale’s resorts. It offers convention space, 36 holes of golf, a spa and some Las Vegas casino-hotel flourishes thrown in.

A 640-seat showroom will feature upcoming shows with George Clinton, Brian Wilson, Clint Black, Smokey Robinson, Cheap Trick and Big Bad Voodoo Daddy.

Talking Stick features 10 lounges and eight restaurants, including an all-day buffet, martini and cigar bar and the Orange Sky fine-dining room on the 15th floor. Private dining coves and an outdoor seating area offer sunset views of Camelback Mountain and the McDowell Mountains. Even the restrooms have a view at Orange Sky.

Tourism leaders said Talking Stick is a great addition that will bolster Scottsdale’s tourism.

“It’s a package that is difficult to compete with,” said Rachel Sacco, Scottsdale Convention and Visitors Bureau president. “We’re lucky it’s here on this side of town.”

The hotel at Talking Stick, with a clean, contemporary design by FFKR Architects, is scheduled to open half its rooms within a week and the remainder by June 10, Burbank said.

A standard room of just under 500 square feet will be $300 in season and $100 in the summer. A 2,000-square-foot presidential suite is $3,500.

All the hotel rooms are non-smoking.

Smoking is allowed in the casino but restricted in the poker room and a small area of slot machines. The casino floor is elevated by 18 inches to allow an upward air flow to vent smoke, Burbank said.

Talking Stick has added about 550 workers and that will push employment to about 3,000 in the tribe’s two casinos along Loop 101 east of Scottsdale. That number includes about 400 tribal members, Burbank said.

The casino will replace a 120,000-square-foot casino that operated for about 11 years in temporary buildings. That casino was set to close at 2 a.m. today. Casino Arizona at Talking Stick Resort was expected to open at 6 a.m.

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