We enter the Tucson real estate market with enthusiasm, looking forward to an up year.  2013 saw prices rise more than 10% to an average list price point of $197,805 as of the end of November, and an average sales price of $191,763.

The median price point in November was 159,500; half the properties sold were less than that price and half were above that price.  A total of 15 homes were priced at $29,900 or less and one property sold for more than $1,000,000.

Tucson and Arizona in general, felt the pain of the real estate market debacle long before much of the rest of the country.  I was in a coaching program at the time with three other agents from the east coast and a coach from the northwest.  These professionals gave me the impression they believed I was just lazy because I kept talking about our market and what was occurring .  Little did they realize there was a lesson in what I was saying – far beyond laziness- and this too would hit them.

Because Arizona is a non judicial foreclosure state, which means lenders do not have to go to court in order to foreclose on a property, the shortest length of time given a lender to foreclose, is six months.  Much of the distressed property has been sold, and unless Congress reinstates the Mortgage Forgiveness Act, homeowners will be paying taxes at their marginal tax rate, on the amount of forgiveness.  This may cause people to try and work through their financial situation and wait for their home value to appreciate with the market.

March generally is the last month that Tucson is home to winter visitors.  Easter marks the end of the season, but Easter is late this year in April and April is the time the crocus and daffodils rise from their winter sleep in the northern country.

Those who wintered in Tucson this year, I am sure, were grateful to miss all the snow, the sleet the ice and the difficult winter their stay at home counterparts witnessed.

Home prices now are low as are interest rates and this is an ideal time to think about purchasing a second home.

Many people arrive in November for the holidays, and granted the holidays without snow are different!  But hiking, birding, or just plain walking  in Tucson’s warm air and sunny days with a light jacket is joyous.

Active adult communities abound including golf course communities where the retiree can play a round of golf every day!  There is an abundance of private and public golf courses from which to choose including the world famous Dove Mountain Ritz Carlton course, made famous by Accenture Match Play.

For non golfers, Tucson offers a plethora of things to see and do.  Those people who opt for an active adult community often have planned activities including book clubs, art lessons, pottery lessons, tennis lesson, culinary lessons, exercise classes, poker and billards rooms and on and on.  But you don’t have to opt for an active adult community to be party to all of those things.

Tucson has an excellent library system and book clubs abound.  For more formal instruction, the University of Arizona and Pima Community College offer classes in literature for the general public, not just students.  The Tucson Museum of Art provides art classes as does the Sonora Desert Museum and for people who want to try something new, the Sonoran Glass Art Academy can help you learn to blow glass while you create beautiful items for your home and friends.

The Tucson Park and Recreation Association sponsors pottery classes in different venues in Tucson. You can also learn to salsa dance, play tennis, learn to swim, take up beadwork or any number of hobbies.  Golf lessons are also offered!

The Audubon Society has a year’s worth of activities for birders and the Sonora Desert Museum also provides classes about the natural habitat of the Sonora Desert.  The Tucson Botanical Garden is another popular place to enjoy time and classes as is the University of Arizona Cooperative Extension Service where one can learn to become a Master Gardener.

Living in an active adult community provides instant activities, but for those who want to customize what to do during retirement, think about a house anyplace, then pick and choose your activities from all that Tucson and its surrounding area has to offer!

http://www.sonoranglass.org/about/staff.htm

http://cms3.tucsonaz.gov/parksandrec/program-guide

http://www.tucsonaudubon.org/

http://ag.arizona.edu/pima/gardening/

http://www.tucsonbotanical.org/

http://www.golfnow.com/tucson?trk=PPC_GNOW_Google_TUC&cam=golfnow_local_-_tucson&adg=regional&kwd=tucson_golfing&pht=Broad&gclid=CO-aye2106cCFQUDbAodkEAh-g

http://www.tucsonmuseumofart.org/

http://www.desertmuseum.org/

For more information, contact me:  information@terrybishop.com or check my website

http://www.terrybishop.com

With five new town Council members, fresh priorities are focusing on being a “business friendly” community, Jerene Watson, Town Manager of Oro Valley,  told the Tucson Association of Realtors Summit last week.

Two economic development summits resulted in the town’s ability to knock off a year in the development and permitting process.  “We are open for business and are continuously reaching out” to entice business to the community.

Ventana Roche is bringing 500 new jobs to OroValley and the town is courting new corporations in the bioscience, high tech and educational areas, Watson said.

The University of Arizona Bio 5 Oro Valley opened and is a research arm, developing potential new medicines.  Basis Charter School Oro Valleyhas students and took only five months with the new approved development plans.  Additionally Pima College Oro Valley campus is operational.

Private/public partnerships are being explored for potential leases of town owned property which will benefit the residents. Focus is on arts, recreation, and culture.  The Town Center development will offer incentives for potential entertainment or businesses and county bike and pedestrian trails provide recreational facilities for residents.

Like the other town managers at the summit, Watson said general fund revenues are down 20%.  Oro Valley does not have a property tax, but relies upon the sales tax.  Single family residential building permits decreased to 50 is fiscal year 2010 compared to 285 in 2008.  This represents a 50% drop in construction sales tax.  The construction sales tax was 40% of the budget and is now at 19%.  Belt tightening is the order of the day.

Unlike federal and state governments, towns cannot resort to gimmicks and tricks and need to come in with a balanced budget.  The town has courted new business to bring in local sales tax revenues.  Financial dash boards are on the website, she said.

The town is also looking at strategic annexation, and in particular 14 acres to the north bordering state land.

“We are positioning Oro Valley as a desired place to live and raise a family” she concluded.

Resources:

Town of Oro Valley:

http://www.orovalleyaz.gov

Basis School:

http://explorernews.com/news/pima_pinal/article_60ac0118-a8bb-51fb-b398-ae2e58cfbfb0.html

Bio 5:

http://azstarnet.com/news/local/education/college/article_eed8d524-3c78-5c71-8108-f94ede670c85.html

The four managers of the towns in Pima County spoke Thursday to the Tucson Association of Realtors® (TAR) with a prognosis of what growth is anticipated in each of the areas.

“Sahuarita is contending with today’s reality and planning for the future” said Jim Stahle, City Manager of Sahuarita, a town which experienced a growth of 9000 houses, with one half of this building in Rancho Sahuarita.

A total of 1700 housing permits were issued in 2006 and in 2010, only 311 permits issued, the same as 2001, he said. Quail Creek, a Robson active adult community, has seen 18% of those building permits.

Sahuarita has cut budgets, cut staff and is making tough decisions in order to maintain the service levels.  As a result, the town has become more efficient.

Challenges facing the new town include a commercial Community Facilities District (CFD), the cost of  which would be shared with developers.

Development is projected in the Rancho Sahuarita Town District which is ideally located between I-19 and Sahuarita Road, Stahle said.

The town conducted a psychographics analysis trying to determine what people would buy in such an area.

Determining if Sahuarita  will “get into the water business” or if water will remain under the purview of private business is another issue facing the town.  If the town decides to purchase the water company, the issue is how to structure the purchase, the fact it will then be subjected to state regulation, and how the town will pay for the water company, now in private hands.

Farmers Investment Company (FIC), the largest pecan grower in the nation, located in Sahuarita, has 6,000 to 7,000 acres it is eyeing for development in the future, possibly 15 to 50 years.  Much of the land is located in a flood plain zone.  Projected growth will impact the river management plan and the master plan. The town and FIC are working together for planned growth and development.

Sahuarita is looking for opportunities to attract well paying jobs, and is identifying areas which are capable of landing employment.  It also, like the other three towns, is considering annexation of adjacent areas.

Resources: http://www.ci.sahuarita.az.us/

http://www.pecanstore.com/Aboutus.asp

If you are considering purchasing a home in Arizona, your agent should provide you with the Buyer Advisory, a document which is nine pages and provides information about items a person should know prior to purchasing a home.

The document, written by the Arizona Association of Realtors, is designed to allow the consumer to check  issues he/she should consider when purchasing a home.  It contains links to many websites which can answer consumer questions.

Information concerning neighborhoods is not static, changing frequently, and the Buyer Advisory is revised periodically.  The websites referenced in the Advisory also change their information frequently.

Crime statistics are important and the Advisory references the various sites in Arizona cities where these statistics can be obtained.  An agent cannot know all of these facts and the knowlegable consumer will reference the Buyer Advisory to find answers to his/her questions.

The Buyer Advisory is also a document which a homeowner can use to ascertain answers to questions he/she may have regarding where to go for tax information, zoning information, information about area schools, and the ever famous sex offender information.

If you are considering purchasing property outside of Arizona, the Buyer Advisory is an excellent guideline to questions you may have and potential places to obtain the answers in that state.

Take advantage of this resource, it is part of a buyer’s due diligence when purchasing a property.   A link to the Arizona Buyer Advisory is provided below, you may be surprised at the amount of information it contains.  Use this information for your advantage.  A knowlegable buyer is a good buyer.

http://www.aaronline.com/documents/buy_advis.pdf

http://www.aaronline.com/documents/buyer_advisory.aspx

Traveling to another state gets us out of our routine, but for fellow out of state Toastmasters out there, Arizona has many Toastmasters’ clubs.  Guests are heartily welcomed.   It’s a great way to meet people and get their take on the Grand Canyon state, what they like and what they don’t.

Taking advantage of attending a meeting such as Toastmasters offers the opportunity to chat with people and get the locals’ perspective on the area.  Formulating a list of questions may be a good idea such as:    Where would you buy a property if you were buying today?  Where would you definitely not buy?   How is the traffic to get to xyz place?  Is there anything you think I should be aware of such as new building, roadway expansion, commercial development coming soon?  How is the crime in this area?  What about drugs?

Real estate agents must be careful answering questions such as these so they are not guilty of steering.  But asking locals such questions is perfectly permissible.  Getting the “take” of area from a cross section of the area’s residents, rather than residents who just live in that particular subdivision, may provide a more realistic viewpoint.  People who live in a specific subdivision will paint the picture brightly and  may not talk about any “downside” to the neighborhood.

An agent can refer buyers to websites such as the crime site or sex offenders site, but this may not give the information a buyer desires to make an informed decision.

Taking an hour or two to attend a local Toastmasters meeting, Rotary, Lions Club, or place of worship with the intent of talking with people who live in the area can reap big rewards.  A buyer may find information which the Realtor® does not know.

The added benefit is discovering local haunts, “good hole in the wall restaurants” which can’t afford to advertise in the slick magazines, places to see which may be out of the way, or a local event which is not well advertised.

If you are thinking about a trip to a locale where you are considering purchasing a home, go that extra step, attend a meeting and ask questions!

An 11.36% increase in Tucson, Arizona homes sold during August statistically illustrates positive movement in the real estate market, and coupled with a decline in inventory of 21.82% and an increase of 39.19% of total listings under contract, the figures demonstrate the numbers of homes on the market in Tucson is decreasing.

This is good for the real estate market. In July 990 homes went under contract and in August 1,378 had contracts. A total of 792 homes were sold in July and 882 or 11.36% more homes sold in August. The median sales price inched up $750.00 from $150,000 to $150,750. and the number of new listings decreased from 1861 in July to the August total of 1,455. However, the total of active listings rose to 7,180 from 6,668 or 7.53% reflecting spillover inventory.

Looking at the percentage of homes sold in each zip code, the areas with more than 20% of homes sold include the downtown area with 23.33% where 7 out of 30 active properties sold; 85746, the southwest area which includes Midvale Park, where 24.86% of the properties sold or 45 out of 181 properties, and 85738, Catalina, where 100% of the properties sold or 1 out of 1 listing.

The Northwest area of town has the most properties on the market with 1,826 homes for sale. During August, 219 homes sold. That is followed by the central area of town which includes the University area, with 921 homes on the market and 102 sold in August. Rounding out the top three is the North section of town which includes the Catalina Foothills with 676 properties on the market and only 69 sold during August.

Price wise, the properties between $120,000 and $250,000 had the most sold and also accounted for the most inventory. Less than 10% of the properties priced above $250,000 were sold in August.

Types of financing were nearly evenly split between FHA loans which 242 buyers selected, conventional loans for which 275 buyers opted, and 245 buyers elected to pay cash. The remaining financing was split between VA loans, owner carry backs, cash to loan and other types of financing.

The average sales price decreased 2.9% from $192,072 in July to $186,562 in August while the median sales price increased about one half of one percent to $150,750.
The average number of days in the market increased by four days to 91 from 87. West side homes took the longest to sell on average at 114 days, while the extreme northeast only took an average of 59 days.

When looking to purchase or sell property, studying the statistical data can give you insight as to how long it may take to sell property and where the price points are located for people looking to purchase property. It also shows up/down movement in the market. Make sure you have the latest Multiple Listing Monthly Statistics to help you make a good decision and ask your Realtor® to help you interpret the data for your specific need.

Resources:
Tucson Association of Realtors August 2010 Monthly Statistical Report:
http://tucsonrealtors.org/tar-v2/aug10.pdf

There are plenty of active adult community properties for sale in Tucson less than $200,000. This is the time to look at your southwest sunbelt home. Check properties now while you still have the best pickings…before the majority of winter visitors arrive.   Enjoy January through April here in beautiful Tucson while your neighbors shovel snow, dig out their car, and bundle up in winter gear just to go to the store.

The price of property in Tucson is at 2003 levels and interest rates are at a historical low. This equation equals an opportunistic time for people who always coveted a retirement home or second home in the southwest sunbelt to purchase that dream.

Tucson and the surrounding area is home to several active adult communities and homes in these areas have decreased in price.   Prices are down 15 to 25% from three years ago.

In the entire Tucson Multiple Listing Service, 91 properties sold during the past three months (since June 22, 2010) in active adult communities at an average list price of $262,873 and an average sale price of $248,302.

That is an approximate 5.5% discount to list price. The median asking price is $249,000 and the sale price was $230,000 or a 7.6% discount to list. And the low price was $92,800 with the sale price of $92,000 or a .08% discount to list. The high end property which sold during the past three months, had an asking price of $599,000 with a sale price of $569,000 or a 5.0% discount to list.

Currently, as of this morning, there are 460 properties in active adult communities on the market, four of which are more than $1,000,000. The average price of those properties is $297,942 but of this total, 45 properties are $500,000 or above skewing the average prices upwards. The median price is $249,700, the low price is $52,500 and the high price is $2,800,000.

Most people seeking an active adult community will be purchasing property below $500,000 and the 415 properties on the market have an average price of $251,827, with a median price of $239,000, a low price of $52,500, and the high price of $499,900. These are asking prices.

Using the discount to list price during the past three months of 5.5%, one may be able to purchase an average active adult community property for about $237,000 if we use the entire domain of properties to $500,000.

To use an old cliché, “the early bird catches the worm”. For more information about Tucson active adult communities, contact me, terry@terrybishop.com for more information and a relocation package.

So, what is my property worth anyway? Is the market up or is the market down?  Whom are we to believe?

It seems as if you can take your pick of economists to whom you listen. Some say we are coming out of the doldrums. The big announcement today said the recession ended in June…and yet other economists say the other shoe is yet to drop, they foresee another 18% drop in home prices.

Part of it is political, it’s almost believe what you want to believe at your own peril. Caveat emptor prevails!

That leaves the home seller/homebuyer in a real quandary. Don’t believe the national media, they are slanted to whatever political perspective they subscribe. The markets are regional, areas which did not see the escalating increases in prices between 2003 and 2008 and remained fairly stable, are still stable.

Areas like Arizona which saw a 45% plus overall increase in housing prices within three years are still reeling from the deflationary impact.

But, there are parts of Arizona, and in particular Tucson, (which is the market I serve) that are harder hit than other areas.

In order to truly value a home, one has to look at what is happening locally, and that is by zip code, and sometimes by subdivision. Those subdivisions which faced overbuilding during the frothy times of 2003-2008 are in far worse shape than areas where homes are older and do not turn over rapidly.

I took the better part of an afternoon to compute the numbers of bank owned properties and the numbers of short sales in every Tucson zip code as of August 30, 2010. I then computed the percentages of each and the combined percentages and found that more than 50% of the homes on the market in some zip codes are distressed properties.

Generally these are places where large master planned communities were being built; Gladden Farms, Star Valley, Rancho Del Lago, Sahuarita, Quail Creek, the Irvington Road/Escalante area, Cortaro Farms near the highway, and Corona de Tucson.

And there are areas where there are less than 20% of the properties in distress; the 85704 area which includes some of Oro Valley and the Casas Adobes area, the center of town near the university in 85716 and 85719, the Diamond Bell Ranch area, Saddlebrook and Catalina,  Mount Lemmon,a portion of the Catalina Foothills, some of Green Valley, and the prize goes to 85646, Tubac with only 7.143% of the homes underwater.

When you are pricing your home to sell, make sure your Realtor® knows the numbers and knows the trend in the area in which you live. I priced three homes today and pulled the numbers from the last six months for the zip code. The pricing differential in all three areas was significantly different. One was in 85747 where 43% of the homes are distressed; one was in 85704 where 19.5% of the homes are underwater, and one was in 85745 where nearly 35% of the homes have problems.

You as the buyer and or seller need to know this because the appraiser is obligated to take distressed properties into consideration when appraising your property.  As someone once said, “the distressed property in this area is the market” and unfortunately everyone suffers whether or not they are in the same predicament.

   The government isn’t in the habit of giving away money to the average citizen who doesn’t have exotic tax loopholes, but anyone thinking about purchasing a house should contact a Realtor and begin looking as soon as possible.  It could be worth up to $8,000 to you.  The tax credits expire April 30.

    First time home buyers are eligible for up to $8,000 or 10% of the market value of the home.  Qualified repeat homeowners are eligible for up to $6,500.  Contracts must be executed by April 30 and closed escrow by June 30, 2010.

   What does this mean to you?  Depending upon where you live and the laws governing real property of your state, the speed with which your lender can act, and the timeliness of your Realtor, purchasing a house from start to finish can be done in as little as a week for a cash buyer, to two months for a buyer using financing. 

   Sitting down with a Realtor should be priority one.  He or she can guide you to a lender who will be responsive to your needs, and a lender who knows and understands the area in which you plan to purchase a property.  Internet  lenders have no idea about the peculiarities of individual areas; using a local lender is always the best choice.  Any problem can usually be resolved fast and competently.

    The lender will ask for all types of documentation and the faster the buyer provides this, the sooner the loan commitment can be made.  While this is transpiring, the Realtor and the buyer can determine criteria  and begin looking.  Finding a property can be accomplished in a few days if buyer and Realtor work full time during that period.

    Once the property is identified and a contract written, the response from the seller may take a few hours to several days.  Because short sales often take months, purchasing a short sale and trying to come in under the April 30 deadline is self defeating.  Time must be allotted for counter offers, or possible rejection, at which point the buyer must determine whether to submit another higher offer, or begin looking again.

     Assuming the offer has been accepted, and one week has elapsed, all inspections must be done.  In Arizona, the buyer has ten days in which to complete all inspections for the property which includes any and all inspections desired by the buyer, but usually the home inspection and a termite inspection.  The request for repairs is then made to the seller who has five days in which to respond.  

     We are now more than two weeks into the process.  Be aware, the seller may opt to decline to do any repairs.  These small challenges along the way should be explained to the buyer by the Realtor.  If we began today, the process so far would take us to the first week of March. 

    The repair addendum has been negotiated and now we must tie up loose ends.  In Arizona, the Realtor will review the commitment for title and make sure there is clear title to the property, issues such as how to take title, disclaimer deeds if needed, must be completed and provided to the title company, and any special documents such as septic certifications, well certifications or Affidavits of Disclosure must be completed properly and submitted to title.

    At this point, we are probably into the end of the second week of March.  The loan officer is completing his paperwork, submitting information to underwriting, and the appraisal has been ordered.  Now it is a waiting game.  The property can probably close escrow by the end of March.  But the process has easily taken more than one month. 

     There are many people working to make sure a buyer is successful purchasing a property.  Many work behind the scenes and are an integral part of a successful transaction.  It is the Realtor’s job to make sure all function seamlessly and that the buyer understand what is transpiring every step of the way.

   Call your Realtor today so you can take advantage of the $8,000 and if you are purchasing a second home, look at the $6,500 tax credit!

     For further information or to find a Realtor near you, contact Terry at terry@terrybishop.com

Questions and Information about the Tax Credit:

http://www.federalhousingtaxcredit.com/faq1.php