Arizona Foreclosed Homes activity slid 3% in November when compared to the previous month, but filings at various stages of the process showed substantially different movements, according to RealtyTrac latest Arizona Real Estate report.
We can start it off by saying and quoting RealtyTrac that scheduled home auctions hit a nine-month high following the default surge that began in August. On a more positive note, RealtyTrac states Arizona Bank Owned Homes activity is at a 44-month low.
Total foreclosure filings are down by double-digits from a year ago, but RealtyTrac doesn’t view the numbers as the making of a positive trend.
James Saccacio, co-founder of RealtyTrac, says the 14 percent year-over-year decline in filings last month is the smallest annual decrease recorded over the past year, and he points out that some states such as California, Arizona, and Massachusetts actually posted increases in foreclosure activity from November 2010 through November 2011.
Default notices were filed for the first time on a total of 71,730 U.S. properties in November. Foreclosure auctions were scheduled on 96,540 properties during the month, and lenders repossessed a total of 56,124 homes.
Of course, Nevada leads the nation as highest foreclosure rate for the 59th straight month. One in every 175 Nevada housing units had a foreclosure filing last month, more than three times the national average. Wow!
Scheduled trustee’s sales in California hit a 10-month high in November, helping the state maintain the nation’s second highest foreclosure rate. A total of 26,509 trustee’s sales were scheduled in California last month, up 14 percent from November 2010 – the first year-over-year increase in scheduled foreclosure auctions in the Golden State since March 2010.
Arizona foreclosure activity increased on a year-over-year basis in November for the first time since October 2010. With filings up 4% from a year earlier, Arizona posted the nation’s third highest foreclosure rate for the fifth month in a row.
Substantial monthly increases in foreclosure activity in Utah and Georgia lifted those states’ foreclosure rates into the nation’s top five in November. Utah’s foreclosure rate ranked No. 4 thanks to a 74 percent monthly increase in foreclosure activity. Georgia saw a 23 percent increase in filings, giving it the No. 5 spot.
Other states with foreclosure rates ranking among the top 10 were Michigan, Florida, Illinois, Ohio, and South Carolina. South Carolina cracked the top 10 for the first time since RealtyTrac began issuing its report in 2005.
Well these numbers are not positive for a rebound of the local Phoenix Real Estate Market, but it does outline for a great time to start building a solid Arizona Investment Property Portfolio. Foreclosures are leaving good potential tenants out in the market looking for a long term rental since they will be out of the purchase market for the next 2 to 7 years. Capitalize on the current market, contact Phoenix Investment Property Partners.
The US and Phoenix Real Estate Markets are Improving … Slowly But Surely
It was a good week for the U.S. economy, despite what was going on in Europe. The Conference Board Index of Leading Indicators was up to 117.4 from 110.1 from October 2010.
- Industrial production grew again. It expanded 0.7% in October. At 94.7% of its 2007 average, total industrial production for October was 3.5% above its year-earlier level. Capacity utilization for total industry stepped up to 77.8%. This is a key to the recovery because major increases in business spending for new plant is not likely to occur until capacity utilization reaches 80% or more.
- The Consumer Price Index for All Urban Consumers now stands 3.5% over year earlier levels.
- National retail sales, according to advanced estimates, increased 7.2% from October 2010.
- Housing had a “better than expected” month but the expectations were low. Privately-owned housing starts in October were at a seasonally adjusted annual rate of 628,000. This is well above year earlier levels of 539,000 and expectations of about 600,000 units. Housing permits were also higher than prior month and year levels.
- Arizona also saw continued employment gains. Total nonfarm jobs were up 44,700 over year earlier levels to 2,433,500 in the state. That is a gain of 1.9% over October 2010. For Greater Phoenix, job gains were 43,200. That equates to gains of 1.8% for October, 2011 vs. October, 2010.While these gains are modest and weak when compared to the extent of the decline since 2007, at least employment is growing.
- In housing news, R. L. Brown reports that 543 permits were recorded in October compared to 485 in October 2010. Median new home prices were $218,504 in October while median resale prices were $110,000.
- According to the Cromford Report, the average number of listings on MLS is 27,354 homes so far in November compared to 45,836 listings in November 2010.
- Days on market were down to 93 in October of this year compared to 104 in October of last year.
Major Point: Not a roaring improvement for Arizona Real Estate… . but slow and steady grow and a sharp decline in average listings.
Fannie Mae has rolled out new guidelines. Phoenix investors who have recently purchased an investment home for cash can now recoup a large portion of their investment immediately!
Cash Out without continuity: when the property is purchased for cash, the new loan is considered delayed financing, allowing the borrower to recoup the cash put into the purchase. This can be done even if the borrower owns over four financed properties.
Guidelines:
Delayed Financing Exception
Investors who purchased a property within the past six months are eligible for a cash-out refinance if all of the following requirements are met:
- The new loan amount can be no more than the actual documented amount of the borrower’s initial investment in purchasing the property plus the financing of closing costs, prepaid fees, and points (subject to the maximum LTV/CLTV/HCLTV ratios for the transaction).
- The purchase transaction was an arms-length transaction.
- The transaction is documented by the HUD-1, which confirms that no mortgage financing was used to obtain the subject property.
- The sources of funds for the purchase transaction are documented (such as, bank statements, personal loan documents, HELOC on another property).
- All other cash-out refinance eligibility requirements are met and cash-out pricing is applied.
Note: The preliminary title search or report must not reflect any existing liens on the subject property. If the source of funds to acquire the property was an unsecured loan or HELOC (secured by another property), the new HUD-1 must reflect that source being paid off with the proceeds of the new refinance transaction.
Eligibility Requirements for Investor and Second Home Borrowers with Five to Ten Financed Properties
With the exception of high-balance mortgage loans, Phoenix investors and second home borrowers with five to ten financed properties must meet the following eligibility requirements:
| Transaction Type | Number of Units | Maximum LTV/CLTV/HCLTV | Minimum Credit Score |
| Second Home or Investment Property | |||
| Purchase | 1 unit | 75%/75%/75% | 720 |
| Limited Cash-Out Refinance | 1 unit | 70%/70%/70% | 720 |
| Cash-Out Refinance (only if delayed financing exception requirements are met — See B2-1.2-03, Cash-Out Refinance Transactions (06/28/2011)) | 1 unit | 70%/70%/70% | 720 |
| Investment Property | |||
| Purchase and Limited Cash-Out Refinance | 2-4 units | 70%/70%/70% | 720 |
| Cash-Out Refinance (only if delayed financing exception requirements are met — See B2-1.2-03, Cash-Out Refinance Transactions (06/28/2011)) | 2-4 units | 65%/65%/65% | 720 |
Contact Phoenix Investment Property Partners for a referral to mortgage broker who can assist in building stronger Residential Rental Investment Portfolio
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