Many Canadian clients ask us about Short Sales. It is not a term commonly used in Canada. Short sales are pre-foreclosure situations where the homeowner is about to be foreclosed on and in a last minute attempt to keep the foreclosure off of his credit history they try to sell it. The home is worth less than what he owes on the home. The homeowner must get approval from the bank to sell for less than the mortgage amount and ask the bank forgive the balance of the mortgage. There are thus 3 parties in a foreclosure: seller, buyer and bank. All 3 must approve the sale price. This is usually a very tricky situation. Most short sales do not sell. I have heard up to 80% of short sales never close. Short sales usually do nothing but waste a seller’s time and create frustration.

Short sales are handled by a bank’s loss mitigation. As you can imagine with the US credit crisis, these departments are completely overwhelmed and understaffed. It can take up to 3 months to get a response from the bank for an offer. During this time you are just left hanging. Most times, after waiting for weeks or months to hear back from the bank about your offer, they simply say no. Banks are often unwilling to accept the below market offer on the home and forgive the balance of the mortgage – are you surprised? This is often the fault of the listing realtor that puts the property on the mls for an unrealistically low price in an attempt to get any offer. Other times, during the process the homeowner just takes off and can’t be found. The seller has to sign all the documents to complete the transaction and if he can’t be found the deal can’t close. Also if the homeowner declares personal bankruptcy, which often happens, that delays the transaction until the bankruptcy is resolved. Other times, there are second mortgages or other liens on the property which have to be negotiated to clean title. During that time period many homes simply go to foreclosure leaving the buyer empty handed.

There are numerous possible problems and pitfalls with short sales. We recommend to our Canadian buyers that if they want a quick, easy super deal they should try to stick to true foreclosures, instead of wading into the murky waters of pre-foreclosures. Please feel free to call me to discuss how to tell the difference on listings between foreclosures and pre-foreclosures. for more information about short sales or to search for Foreclosures check out www.ThePhoenixExperts.com.

Marc Brodeur, Realtor
www.ThePhoenixExperts.com
1-800-300-0263

The old adage “You Get What You Pay For” is very true in real estate. I fully understand it is very difficult to search for a Phoenix home online from Canada. However, if you see houses online that are priced under $100,000 you need to ask yourself why they are priced that way. Generally homes under six figures are in the farthest edges of the city. Living on the edge of the city presents many challenges. The commute into the city is usually fierce. This is a major consideration whether you work here or not. Even if you are only coming as a snowbird to enjoy the weather, you will still have to leave your home to shop, get gas, for entertainment and to go restaurants. If there is a lack of basic grocery stores, convenience stores, gas stations, restaurants etc you will still have to fight the traffic to get to those places. Communities such as Maricopa and Queen Creek are exburbs, not suburbs. They are practically out in the desert on the way to Tucson. There are no decent freeways in that area. All the roads are congested 24-7 from what I hear. This affects not only whether you enjoy your home, but also future appreciation and investment potential. If locals don’t want to live there, you will have a difficult time selling your home in the future. Please feel free to call me to discuss the local areas and what community might suit you best. We are here to help. We want to help you find the perfect vacation, retirement or investment home.

Marc Brodeur, Realtor
www.ThePhoenixExperts.com
1-800-300-0263

I receive emails from clients daily about foreclosures that they saw on their personal web pages (custom searches made for each client with our free Home Finder Service). They often want to know if this deal is “for real” because it seems to good to be true. That’s the beauty of many foreclosures. They are priced so low at fire sale prices that they are almost too good to be true. That is exactly the reason many foreclosures are snapped up by “on the ball” buyers within a few days of being put on the mls. The best deals go fast. I know the rumor mill in Canada may be behind and you may be getting the impression that homes just sit on the market for months and months in Phoenix. That is absolutely true for homes that are not priced well. Nothing will move a home if it is over priced. The real deals, however, sell within days. If you want to take advantage of a super foreclosure deal it is essential that you have all your ducks in a row and are able to act quickly. This means you need to have your financing or cash ready. You also need to be able to get down to Phoenix quickly if you see something that you want to make an offer on. Like they say, The Early Bird Gets the Worm!

Marc Brodeur, Realtor
www.ThePhoenixExperts.com
1-800-300-0263

Occasionally I will run the numbers on zip codes in the Phoenix area to see how they look. As of tonight (Sunday, July 13th at 1130 PM AZ Mountain Standard Time) Surprise’s 85379 zip code and Buckeye’s 85326 zip code both had 649 foreclosures scheduled in the next 90 days. If those zip codes were fully built out (ie 10,000 addresses), and that is unlikely as they are half pasture, there are approximately 1 in 15 homes headed to foreclosure this quarter in those areas. The quarter that follows or precedes this does not include the same homes. When the foreclosures stop flowing it will be interesting to see how many homes foreclosed in those zip codes. I would guestimate it would be a few thousand over an 18 month span with probably another 1000 in short sales. Both of these zip codes had an explosion in building during the bubble and a great deal of so called investors (now called speculators). It is interesting how verbiage evolves isn’t it?

Continuing on, Goodyear’s 85338 currently has 466 foreclosure notices. They are the runner up in the west valley. Again a lot of construction in that zip code during the bubble.

In the far north valley, we have Anthem’s 85086 coming in at 431 current foreclosure notices.

One has to understand that not all will end up foreclosing. The odd one will actually cure in the 90 day period, but that is the exception in this market. Most foreclose and a smaller percentage also are sold via short sale before foreclosure. That is if the bank will actually get back to you before the foreclosure date! It amazes me how many of these pre-foreclosure/future trustee sales are not even active listings when one does this search. It is hard to sell a property as a short sale when they aren’t even listed! The owners most likely don’t see the short sale helping them much, especially if they were an “investor-read speculator” during the bubble. When you have 5 properties going to foreclosure, will a short sale or two actually help your credit rating vs 3 foreclosures? So they walk….

Litchfield Park’s 85340 came in at 296 foreclosures. Getting better as we get closer to the 101.

Scottsdale’s 85255 had 255 foreclosures. During the bubble 500 new homes were built in DC Ranch’s Desert Parks area. That is northeast of the 101. There are a lot of trustee sales scheduled in that area. 85254 had 204, mostly in condo conversion projects converted during the bubble. Not really a big surprise. Far north Scottsdale’s 85262 had 108 foreclosure notices, and 85259 (Hidden Hills area of Scottsdale) had 170.

Desert Ridge’s 85054 had only 22. Amazing. Almost 20 are in a condo conversion project. Converted during the bubble unsurprisingly. So the rest of the east side of Desert Ridge which didn’t have any single family homes built during the bubble have 4, that is correct, 4 foreclosures. I guess people just can’t walk away from good shopping! Hey Nordstrom’s is coming to City North, why would anyone sell their home there right? ; )

The west side of Desert Ridge (85050) where Aviano was built during the bubble has 121 foreclosure notices. Are we seeing a pattern here? Any zip code with a lot of building activity during the bubble has a lot of foreclosures now.

Paradise Valley has 44 currently scheduled. It will be interesting to see how many are scheduled in a few more quarters. Many luxury home builders speculated in 85253 and started building with out a buyer and now they sit. Only the crickets are active. Homes over 3 million are as common as bigfoot sightings right now in the Business Journal.

Biltmore’s 85016 has 225 foreclosure notices. Many are condo conversions or new condos in that zip code also. Arcadia’s 85018 has 157 foreclosure notices. Mid-town’s 85012 has 37 scheduled, and 85013 has 80 scheduled. Interestingly those last 2 zip codes actually appreciated in value in 2007.

If you have any foreclosure questions, feel free to shoot me an email @ Marc@ThePhoenixExperts.com or call me at 602 692 4288.

Marc Brodeur
Realtor
www.ThePhoenixExperts.com
Marc@ThePhoenixExperts.com
(602) 692-4288
1-800-300-0263

Bidding Wars? Multiple Offers? You would think I am talking about the boom days of 2004-2005. No – this is actually going on in Phoenix TODAY over some Foreclosures! Many of the current listings on Foreclosures are such fantastic deals that I am routinely seeing multiple offers for the same house. Buyers know how undervalued some of these homes are and they are pouncing on the opportunity to get one at a below market price. There is often instant equity when purchasing a Foreclosure in Phoenix these days.

If you are interested in a Phoenix Foreclosure call me. I can set up a personalized tour of multiple foreclosure properties for you. There are many great deals in the Phoenix area currently.

Marc Brodeur, BS, DC
REALTOR
www.ThePhoenixExperts.com
Marc@ThePhoenixExperts.com
(602) 692-4288
1-800-300-0263

The biggest hurdle involved in buying a Pre-Foreclosure or Short Sale home is getting all of the parties to agree to the contract. In a Short Sale situation the homeowner is trying to sell his home for less than what he owes to the bank. The bank has to agree to accept less than is owed in order for it to be sold. The bank will do this simply to avoid the expense of foreclosing upon the home to take back title. So in a Short Sale situation there are three parties to a contract: the Seller (homeowner), the Bank, and the Buyer. All must agree to the purchase. I have run into the situation where a homeowner lists the home with a Realtor, a Buyer agrees to pay the list price, the Bank’s representative has made it known that they would approve the offer, BUT the homeowner has since walked away and cannot be found to sign the deal. The other frequent scenario is the Buyer and Seller come to an agreement, but the Bank decides not to accept the deal. The Bank usually counter-offers and demands a higher purchase price. Unfortunately, a Short Sale can be a frustrating ordeal for a prospective Buyer. It is necessary to have a Realtor experienced with Short Sales, such as myself. If you are interested in a Pre-Foreclosure or Short Sale in the Phoenix area feel free to contact me.