Short sales are becoming an increasingly larger share of the real estate market here in the Scottsdale and Mesa areas, with short sale closings accounting for 21% of all closings in April of 2010, up from 9% in April of last year. There were 34 successful short sales closed this April with sales prices from $600,000-1.65m. There is a noticeable trend that more luxury homes and real estate are entering the distressed market.
The Scottsdale and Phoenix Luxury home market has been affected by rising interest rates on jumbo loans, limited loan availability, and increasingly tight requirements in qualifying for loans. According to the National Association of Realtors, inventory on homes priced above $750,000 has risen from 18 months supply in 2007 to a 40-month supply in 2009. NAR also reported that the foreclosure rate on jumbo loans was nearly double the rate on conforming loans ($417,000 and below).
The weak economy, lack of opportunities to refinance, the growing inventory of luxury homes, and fewer qualified buyers has created a huge problem for luxury homeowners who need to sell..... but can't.
Where do luxury homeowners facing these problems turn to?
There are government programs to help homeowner in distress including the HAMP for loan modifications, and HAFA for short sales. Homeowners with higher loan balances may not qualify for these programs, but most servicers are willing to follow similar processes to minimize losses. Typically a short sale will cost a bank an average of $40,000 to foreclosure rather than short sale, which includes legal fees, depreciation, and carrying costs. This FREE help is available to residents of Scottsdale and Phoenix facing foreclosure.
It is critical for homeowners to understand their strategies, and should contact a real estate agent who is experienced with the foreclosure process, government programs, anti-deficiency laws, and short sales. I have created a website with FREE information for homeowners on alternatives to foreclosure, and am always here to answer any questions or concerns.
The Scottsdale and Phoenix Luxury home market has been affected by rising interest rates on jumbo loans, limited loan availability, and increasingly tight requirements in qualifying for loans. According to the National Association of Realtors, inventory on homes priced above $750,000 has risen from 18 months supply in 2007 to a 40-month supply in 2009. NAR also reported that the foreclosure rate on jumbo loans was nearly double the rate on conforming loans ($417,000 and below).
The weak economy, lack of opportunities to refinance, the growing inventory of luxury homes, and fewer qualified buyers has created a huge problem for luxury homeowners who need to sell..... but can't.
Where do luxury homeowners facing these problems turn to?
There are government programs to help homeowner in distress including the HAMP for loan modifications, and HAFA for short sales. Homeowners with higher loan balances may not qualify for these programs, but most servicers are willing to follow similar processes to minimize losses. Typically a short sale will cost a bank an average of $40,000 to foreclosure rather than short sale, which includes legal fees, depreciation, and carrying costs. This FREE help is available to residents of Scottsdale and Phoenix facing foreclosure.
It is critical for homeowners to understand their strategies, and should contact a real estate agent who is experienced with the foreclosure process, government programs, anti-deficiency laws, and short sales. I have created a website with FREE information for homeowners on alternatives to foreclosure, and am always here to answer any questions or concerns.
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