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Arizona Residential Homes For Sale | Rehab, Foreclosures, and more from Artisan Real Estate Group
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Buying A Home

Because we are a real estate agency, it goes without saying that we would recommend hiring an agent to help you find your new home. But you don't have to if you prefer to go to open houses and look through a plethora of homes online. Mostly, an agent will save you time and cost you NOTHING! Some of the things and agent can do for include:

  • An agent can send you listings directly from the MLS that fit your specific parameters.
  • Agents often know of new listings coming up that are not yet on the market.
  • Agents will preview homes for you.
  • An agent can generally spot overpriced listings and advise you accordingly.

Additionally, just because you may feel restricted by price ranges -- especially if this is your first or second home purchase -- don't let anybody tell you that you can't afford to be choosy when looking for a home to buy! You are unique. You have needs and wants for your new home that are different from everyone else. With that in mind, let's define the process and some of the homebuying parameters.

Find a Home to Buy

Buying a home can be an overwhelming process and emotionally draining. Finding the right home is not always an easy task. We advise buyers to look at a maximum of 5-7 homes at a time because any more than that will make a buyer's head spin.

Most buyers conduct a lot of research online before ever stepping foot in a home. Buyers spend an average of 6 to 8 weeks, according to the National Association of REALTORS, trying to figure out where they want to live. But once the neighborhood is selected, most buyers end up buying a home after 2 or 3 home tours.

Get a Loan

It's not always necessary to have a mortgage broker or bank pre-approval before buying a home, but it's definitely smarter to get one in advance. This way you know for certain how much home to buy.

Popular first-time buyer loans are FHA loans because the minimum down payment requirement is much less than a conventional loan. However, if you are thinking about buying foreclosures or short sales, for example, conventional buyers tend to get priority with REO banks and sellers.

Pick a Location & Neighborhood

  • Suburbs or Country.

Pros: Generally less expensive. Often newer. Tract homes are conforming. More home for the money.
Cons: More time in traffic if driving to town for work. Further away from entertainment options cities offer.

  • Urban.

Pros: Closer to many employers. Walking distance to theaters, restaurants, schools. Many period homes offer more distinctiveness in styles.
Cons: Often noisier. Higher crime rates. More expensive.

  • Busy Streets.

Pros: Often homes on streets with more traffic are thousands of dollars cheaper. If noise doesn't bother you, don't pass up homes on busy streets. Drive by at different times of the day / week to ascertain noise levels.
Cons: These types of homes will always sell for less than others in the same area. If bedrooms are located near the front of the home, sleep may be disturbed.

  • Cul de sac.

Pros: Number one choice of buyers with children.
Cons: Less privacy, neighbors know more about you.

  • Corner lots.

Pros: Often larger lots. Fewer neighbors. More visibility.
Cons: More traffic noise. More vulnerable to vehicles jumping the curb. Kids might trespass at the corner. More sidewalk to shovel in winter.

Choose the Type of Home

  • Single Family.

Pros: Good appreciation. Opportunity for gardens. More privacy. Quieter.
Cons: More expensive than our next category. More maintenance.

  • Condos, Townhomes, Cooperatives.

Pros: Less expensive than comparable single-family homes. Generally newer so fewer repairs. Lock-n-go lifestyle. No yard or exterior maintenance.
Cons: Less privacy. Noisier. Common walls and/or floors and ceilings. Sometimes no private yard or balcony.

Pick the Number of Stories

  • Single Story.

Pros: Easy wheelchair access. Some medical conditions such as bad knees make it hard for certain individuals to climb stairs. Easier to clean.
Cons: Can be noisier if stereos or televisions are located on the same floor as bedrooms. Some people feel safety is compromised if bedrooms are located at ground level. More of the lot is absorbed by living quarters.

  • More than One Story.

Pros: More living space on same foundation than a ranch home. Less noise if entertaining on lower level while other family members sleep upstairs.
Cons: More trips up and down the stairs to carry stuff to bedrooms. If laundry rooms are on the second floor, washer leaks are major. Might need dual vacuum cleaners. It is difficult to maintain consistent temperatures on each level without dual heating and cooling units.

  • Split Levels.

Pros: Often less expensive if purchased with lower level unfinished. Higher ceilings are appealing. Downstairs family room separates noise levels from upstairs. More square footage on same size lots as ranch homes.
Cons: Less storage space. Hassle to take trash downstairs and carry groceries upstairs or vice versa. Kitchens tend to be smaller.

Define Interior Specifications

  • Number of Bedrooms.

Pros: Common minimum requested configurations are 3 bedrooms. Newer parents prefer bedrooms located on one level.
Cons: 2 bedrooms appeal primarily to first-time home buyers, singles or seniors. However, don't discount a two bedroom if an extra den will satisfy your space requirements.

  • Number of Bathrooms.

Pros: More than one bath is preferred by most people. One bath homes are often less expensive.
Cons: Don't pass up a one bath home is there is room to add a second bath. Sometimes it costs less to put in an extra bath than it does to buy a two-bath home.

  • Square Footage.

Pros: larger spaces offer more room and cost less per square foot than smaller spaces.
Cons: Don't be misled as lay-out is more important than actual square footage. Sometimes well designed smaller spaces appear larger.

  • Bonus Rooms.

Pros: Extra space for media rooms, art studios, children's playrooms, gyms, den/study.
Cons: More expensive

Decide How Many Garages & Type

  • Attached.

Pros: Cheaper to build. Convenient if raining or snowing.
Cons: Higher noise levels inside the home from cars. Some people feel they are an eye sore. If the garage door to the house self locks, you could get locked out at an inopportune time.

  • Detached.

Pros: Can be tucked away from site lines. Quieter.
Cons: More expensive to build. Farther to walk in bad weather.

Additional Considerations

  • School districts.
  • Special amenities such as fireplaces, pools or spas.
  • Condition of plumbing, electrical, heating & cooling units.
  • Available utilities such as cable or DSL, satellite.
  • Sewer, cesspool or septic connections.
  • Fixers. If you're handy with tools, you might save a lot of money.

Finally, Negotiate the Offer

Buyers sometimes make the mistake of comparing the sales price of a home to other homes they have seen. It's a mistake to compare sales prices among homes for sale. That's because sellers can ask any price they want. It doesn't mean the home will sell at that price.

An agent can provide comparable sales and examine the pending sales. Comparable sales are similar type homes in the same condition and location that have sold within the past 3 months. Pending sales will become the comparable sales by the time your home closes.

You may need to pay over list price in a seller's market, especially if many buyers are vying for the same inventory. Your agent can give you a reasonable price range and help to manage your expectations. A good buyer's agent knows there is always more to an offer than its price, but price is paramount.

If you are ready to buy a home, Please This e-mail address is being protected from spambots. You need JavaScript enabled to view it today for your FREE consultation on buying a home in Arizona.  An Artisan Real Estate Group representative will contact you within the 24 hours to discuss your specific needs.

 
Selling a home

The longer a seller's home is on the market, the less attractive the home becomes to buyers. The best home selling tricks are to price it right, prepare it for sale, hire the best listing agent and attract that excited home buyer who will offer top dollar in record time.

Knowing how to professionally spruce up your home is also part of the battle. The other half is figuring out if you have too much furniture, the wrong type or a bad arrangement and whether it's worth making repairs or staging your home to transform that house into an irresistible and desirable showcase for potential buyers.

Deciding how much your home is worth is also part of the art and science. It's a combination marrying analytical statistics to emotional appeal and market movement. You do not want to overprice your home or try to "test the market." You want to price it just right.

If the house for sale next door to you is a bank-owned home, but all the other homes for sale in the neighborhood are not, you don't have much of a problem. However, if most of the homes that have recently sold in your area were bank-owned homes and short sales, you have a problem. That problem is you must compete with foreclosures and short sales to sell your home.

Your home's market value is directly related to distressed sales if those short sales and foreclosures dominate the neighborhood.

Prior to the real estate bubble, appraisers would often ignore the distressed sales when appraising a home. Since then, appraisers pay close attention to the number of distressed sales that have closed and those presently for sale. What's a regular seller with equity supposed to do to compete?

Pricing a Home With Equity Against Foreclosures and Short Sales

Pricing a home is at best a mix of facts, science and emotions. It's a combination of wearing a seller's hat and stepping into the buyer's shoes. Bear in mind that it doesn't matter much how much you think your home is worth if a buyer disagrees. Try answering these 3 questions:

  • What would make a buyer buy your home over a foreclosure or a short sale?
  • Why would a buyer's lender appraise your home for more than a foreclosure or short sale?
  • How much more is your home worth than a distressed sale?

You might be surprised at the answers. The truth is your home is not worth a whole lot more than a foreclosure, even if you put in upgrades, if all the recent sales are foreclosures and short sales. Appraisers don't give a huge allowance for upgrades like they used to do.

Buyers want a good deal. They might buy a home that needs carpeting, for example, if adding the cost of new carpeting still makes that bank-owned home's price attractive. On the other hand, if your home, with equity, is in tip-top shape and priced within the range of distressed sales, a buyer is much more likely to choose your home.

However, say, a bank-owned home priced at $200,000 needs $10,000 worth of work or improvements. If your home doesn't need any work, a buyer might offer only $210,000 for your home.

Examine the Foreclosed and Short Sale Comparable Sales

Look at every similar home that has sold in the neighborhood over the past three months to determine comparable sales. The list should contain homes within a 1/4 mile to a 1/2 mile and no further, unless there are only a handful of comps in the general vicinity or the property is rural.

Pay attention to neighborhood dividing lines and physical barriers such as major streets, freeways or railroads, and do not compare inventory from the "other side of the tracks." Perceptions and desirability have value. Compare similar square footage, within 10% up or down from the subject property, if possible.

Compare homes with similar ages. One neighborhood might consist of homes built in the 1950s, co-mingled with another ring of construction from the 1980s. Values between the two will differ. Compare apples to apples.

Tip: We suggest to our clients that they price homes among distressed sales a little bit below market value. This tends to drive multiple offers as buyers outbid each other, resulting in a higher sales price for sellers.

 
Short sales

A short sale in real estate is not always a pleasant transaction.

There are many ways to lose a home but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale."Currently, roughly half of the sales in Phoenix are short sales. That's how prominent short sales have become.

When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales.

If you are considering buying a short sale, there could be drawbacks. For your protection, we suggest that all borrowers obtain legal advice from a competent real estate lawyer and consult with an accountant to discuss short sale tax ramifications.

As real estate agents, we are not licensed as lawyers or CPA's and cannot advise on those consequences. Except for certain conditions pursuant to the Mortgage Forgiveness Debt Relief Act of 2007, be aware the I.R.S. could consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. In some states, this amount is known as a deficiency. A lawyer can determine whether your loan qualifies for a deficiency judgment or claim. Although all lenders have varying requirements and may demand that a borrower submit a wide array of documentation, the following steps will give you a pretty good idea of what to expect.

Call the Lender

You may need to make a half dozen phone calls before you find the person responsible for handling short sales. You do not want to talk to the "real estate short sale" or "work out" department, you want the supervisor's name, the name of the individual capable of making a decision.

Submit Letter of Authorization

Lenders typically do not want to disclose any of your personal information without written authorization to do so. If you are working with a real estate agent, closing agent, title company or lawyer, you will receive better cooperation if you write a letter to the lender giving the lender permission to talk with those specific interested parties about your loan. The letter should include the following:

  • Property Address
  • Loan Reference Number
  • Your Name
  • The Date
  • Your Agent's Name & Contact Information

Preliminary Net Sheet

This is an estimated closing statement that shows the sales price you expect to receive and all the costs of sale, unpaid loan balances, outstanding payments due and late fees, including real estate commissions, if any. Your closing agent or lawyer should be able to prepare this for you, if you do not know how to calculate any of these fees. If the bottom line shows cash to the seller, you will probably not need a short sale.

Hardship Letter

The sadder, the better. This statement of facts describes how you got into this financial bind and makes a plea to the lender to accept less than full payment. Lenders are not inhumane and can understand if you lost your job, were hospitalized or a truck ran over your entire family, but lenders are not particularly empathetic to situations involving dishonesty or criminal behavior.

Proof of Income and Assets

It is best to be truthful and honest about your financial situation and disclose assets. Lenders will want to know if you have savings accounts, money market accounts, stocks or bonds, negotiable instruments, cash or other real estate or anything of tangible value. Lenders are not in the charity business and often require assurance that the debtor cannot pay back any of the debt that it is forgiving.

Copies of Bank Statements

If your bank statements reflect unaccountable deposits, large cash withdrawals or an unusual number of checks, it's probably a good idea to explain each of those line items to the lender. In addition, the lender might want you to account for each and every deposit so it can determine whether deposits will continue.

Comparative Market Analysis

Sometimes markets decline and property values fall. If this is part of the reason that you cannot sell your home for enough to pay off the lender, this fact should be substantiated for the lender through a comparative market analysis (CMA). Your real estate agent can prepare a CMA for you, which will show prices of similar homes:

  • Active on the market
  • Pending sales
  • Solds from the past six months.

Purchase Agreement & Listing Agreement

When you reach an agreement to sell with a prospective purchaser, the lender will want a copy of the offer, along with a copy of your listing agreement. Be prepared for the lender to renegotiate commissions and to refuse to pay for certain items such as home protection plans or termite inspections.

Now, if everything goes well, the lender will approve your short sale. As part of the negotiation, you might ask that the lender not report adverse credit to the credit reporting agencies, but realize that the lender is under no obligation to accommodate this request. Credit report status is not always negotiable.

 
Bank/REO Owned Properties

An REO (Real Estate Owned) is a property that goes back to the mortgage company after an unsuccessful trustee sale auction. In the event a bidder does come forward at the trustee auction, the property "reverts" to the bank. It becomes an REO, or "real estate owned" property.

The bank now owns the property and the mortgage loan no longer exists. The bank will handle the eviction or the tenant or owner, if necessary, and may do some repairs. They will negotiate with the IRS for removal of tax liens and pay off any homeowner's association dues. As a purchaser of an REO property, the buyer will receive a title insurance policy and the opportunity to investigate the property.

Each bank works a little differently in the way they sell their REO properties, but they all have similar goals. They want to get the best price possible and have no interest in "dumping" real estate cheaply. Generally, banks have an entire department set up to manage their REO inventory.

Once you make an offer to purchase, banks generally present a "counter-offer." It may be at a higher price than you expect, but they have to demonstrate to investors, shareholders and auditors that they attempted to get the highest price possible. You should plan to counter the counter-offer.

Your offer or counter-offer will probably have to be reviewed and approved by several individuals and companies. Even once an offer is accepted, the bank may insert wording like "..subject to corporate approval with 5 days."

Banks always want to sell a property in "as is" condition. Most will provide a Section 1 pest certification, but not unless you include it in your offer and negotiate the point. They will allow you to get all the inspections you want (at your expense), but they may not agree to do any repairs.

Your offer should include an inspection contingency period that allows you to terminate the sale if the inspections reveal unanticipated damages that the bank will not correct.

Even though you agreed to "as is," always give the bank another opportunity to make repairs or give you a credit after you've completed your inspections. Sometimes they'll re-negotiate to save the transaction instead of putting the property back on the market.

Before making an offer, have your agent contact the listing agent and ask the following:

  • Are there any inspection reports?
  • What work has the bank agreed to?
  • Is there a special "as is" form?
  • How long does it take the bank to accept an offer?
  • How does your agent deliver the offer?

Offers are usually FAXED to the bank. The listing agent needs your originals. There is no formal presentation. Keep in mind: nothing happens evenings and weekends (banks are closed)

Since there is no face-to-face presentation to the bank, provide the listing agent with a pre-qualification or better yet, a pre-approval letter and buyer biography. Make your offer easy to accept. Remember that REO's sell at pretty close to full market value and are not the deals they once were.

 
Get a FREE Market Analysis Of Your Home

In the market to sell your home? Please This e-mail address is being protected from spambots. You need JavaScript enabled to view it and a representative of Artisan Real Estate Group will be in touch to give you a FREE market analysis and pricing assessment of your home.

 
Want to Buy or Sell A Home? Contact Us.

Are you interested in buying or selling a home? Please This e-mail address is being protected from spambots. You need JavaScript enabled to view it today for your FREE consultation on buying a home in Arizona.  An Artisan Real Estate Group representative will contact you within the 24 hours to discuss your specific needs.

 


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