Earth Fissures Undermining Foundations...

Earth fissures undermining foundations of growth, from the East Valley Tribune on MSNBC.com, reports that the fast growing area of Queen Creek is facing the same problem with earth fissures that Temecula, California experienced in the mid 1980's. By 1988, there were more than 200 lawsuits alleging more than $25 million in damages filed against developers in the Temecula area. Riverside County initially put a ban on building permits and then passed an ordinance requiring structural and geotechnical evaluations. Some residents left the area in fear of the fissures, others had difficulty selling their properties. Real estate brokers shunned the area and home values fell. Can it happen here? Queen Creek recently took a step toward dealing with earth fissures, commissioning a study that will include determining how the town will develop around fissures. But the problem is identifying where all the fissures are located. The state has addressed these issues with a House bill that would require regularly updated, digital mapping of earth fissures utilizing GPS technology, which could take up to two years to complete. A Senate bill would mandate increased disclosure of earth fissures by property owners selling five or fewer lots. The bills have yet to pass, and an appropriation of hundreds of thousands of dollars is needed for the mapping.

http://www.msnbc.msn.com/id/11575169/

Residential Increases Homeowners Will See This Week are in Some Cases Breathtaking...

Notices to reflect home-values hikes, from the Arizona Republic, reports that more than 1.3 million notices of property values will be hitting Maricopa County mailboxes this week and they will mean higher property taxes with the higher home values that occurred since the last valuations two years ago. The county's median home value is more than 50 percent higher than two years ago. County Assessor Keith Russell said that the residential increases homeowners will see this week are in some cases breathtaking. Although higher taxes are likely, a more valuable home doesn't necessarily mean a costlier tax bill. "As long as the taxing districts don't spend more money than the revenues from new construction, most people's tax bills will stay about the same," said county Treasurer David Schweikert.

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Mortgage Rates Ease for 1st Time in 5 Weeks...

Confidence that the Federal Reserve will continue to keep inflation in check helped ease the average mortgage rates for the first time in five weeks, with the national average commitment rate on a 30-year, fixed mortgage down slightly to 6.26 percent from 6.28 percent last week, according to Freddie Mac.

The national average commitment rate on a 15-year, fixed mortgage also edged down to 5.89 percent from last week's 5.91 percent.

The national average commitment rate, along with fees and points charged by lenders, reflects the cost of obtaining a mortgage.

The average rate on a five-year adjustable-rate mortgage bumped up to 5.96 percent this week from 5.95 percent last week, while the average rate on a one-year ARM fell to 5.32 percent from 5.36 percent last week.

“Over the long term, we expect mortgage rates will bounce back and forth a bit, remaining near current levels," says Frank Nothaft, Freddie Mac vice president and chief economist.

— REALTOR® Magazine Online

DC Ranch Deal Among Biggest in Valley...

Couple buys home for $9.5 mil, DC Ranch deal among biggest in Valley, from the Arizona Republic Scottsdale, reports that a house in an exclusive section of DC Ranch has sold for $9.5 million in a deal that ranks as the third highest in Valley history. The 11,000 square foot home sits on two acres in Silverleaf. Home sites in Silverleaf can sell for as much as $5 million, with most going for $2 million to $3 million. Gietz Master Builders was the homebuilder. William and Janis Meadows are listed as the buyers. The Valley's top house sale was $11.4 million for a Paradise Valley estate bought last year by a limited liability company belonging to venture capitalist Kent Mueller. The number two spot is held by European businessman Pierre Falcone's $9.6 million purchase in 2001 of a house near Mummy Mountain.


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Freeways Could be Built in Pinal County...

Officials take step toward $6 billion road plan, from the Arizona Republic, reports that the State Transportation Board has approved a corridor study by ADOT that outlines where freeways could be built in Pinal County. However, the freeways do not have funding yet and it will still be almost ten years before construction begins. The plan calls for $2 billion in freeway corridors; one that runs from U.S. 60 at Apache Junction south to Florence; a Williams Gateway Freeway extension from the Santan Freeway in Mesa to the U.S. 60 south of unincorporated Gold Canyon; a route from about Riggs Road in Pinal County east to U.S. 60 at Florence Junction; and a north-south highway from Florence to Eloy. The next step is for ADOT to review and pick exact routes for those freeways. Pinal County is expected to grow to 1 million population in ten years, and 2 million in 20 years. Transportation has increasingly become a concern with all of the projected growth in Pinal County. Look for county and city officials to create innovative ways to accelerate the building of new freeways in Pinal County.

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A Wider I-17 Years Ahead of Schedule...

Bill targets a wider I-17 years ahead of schedule, from the Arizona Republic, reports that a bill in the state senate, Senate Bill 1504, would appropriate $75 million per year for five years from Arizona's general fund to widen I-17 from Carefree Highway to the Maricopa/Yavapai County line. The funding would start in the 2006-07 fiscal year. The expansion of I-17 from Loop 101 to Carefree Highway is already set to begin in 2007, but widening beyond that point is not scheduled until at least 2020 under Maricopa County's Regional Transportation Plan approved in 2004. This proposal is the second effort to improve/speed up the freeways in various parts of the Valley. In the southwest Valley, the growing communities of Goodyear, Avondale and Buckeye are considering a tax-hike to accelerate the widening of Interstate 10 through those areas.

http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/arizonarepublic/local/articles/0222freeway0222.html

'Fix & Flip' Crowd Fired Up...

'Fix, flip' crowd fired up, from the Arizona Republic, reports that about 1,000 investors and would-be investors spent the weekend at Phoenix Civic Plaza attending the Real Estate Investors and Landlords Conference & Expo. Many came to learn how to find cheap properties and then "fix and flip" them. The fact that housing prices have stabilized or even fallen in some areas and the number of homes for sale has risen significantly in the past few months didn't seem to cool interest. Phoenix investor Dolf de Roos, the featured speaker at the event, said "It does affect the short term. I think the heat is going to come out of the market a little bit but not long and not much." He said that even if housing prices come down by 5 or 10 percent, investors still came out ahead because the prices had grown by about 40 percent last year. De Roos said the Phoenix area remains good for real estate investing because it is growing and has several major employers.

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Metropolitan Phoenix is the Multi-Billion Dollar Question...

Will area economy lose $1 billion in housing?, from the Arizona Republic, reports that Las Vegas has gambling. Detroit has the auto industry. Phoenix has housing. What this year's housing market holds for Metropolitan Phoenix is the multi-billion dollar question. The article states that a 10 percent drop in home building or sales would cost the Valley's economy at least $1 billion. At a recent Urban Land Institute conference in January, local developer Francis Najafi of the Pivotal Group called for as few as 35,000 new home permit Valley-wide in 2006, a 45 percent drop from 2005's record 63,000. Mark Upton of Engle Homes was more upbeat, calling for 45,000 new homes. Earlier this year, most market analysts predicted close to 60,000 new homes. It will be interesting to see how this year shakes out!

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Cooling Housing Market Means Sizzling Bargains...

Cooling housing market means sizzling bargains, from the Arizona Republic, reports that home builders are now offering all types of deals on spec houses in subdivisions across the Valley. These kinds of deals were unheard of last summer, when people camped out to get into a lottery to buy in a new subdivision. Now the frenzy is gone and home builders are trying to entice buyers with freebies and price cuts in "let's make a deal" sales pitches. It is another clear sign that the Valley's housing market is slowing from last year's record pace. It is not just the new home building sector that has cooled off. The number of existing homes for sale has shot up from a year ago, and prices are flat or down slightly in most areas. "Most of the investors are gone, and traffic is down in home builders' sales trailers," said Jay Butler, director of the Arizona Real Estate Center at ASU. "Just look at all the ads. Builders are trying to move homes fast," he added. There are about 2,800 more empty new homes Valley-wide than a year ago, according to Metrostudy, a real estate consulting firm. Local housing analyst RL Brown adds, "There's no question the overall marketplace has changed. The consumer is saying 'Excuse me. The prices are too high.'"

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Appreciation Numbers for 145 Market Areas...

Home prices posted solid gains in 2005, from CNNMoney.com, also reports on the NAR report on home prices. It gives the appreciation numbers for 145 market areas so you can compare our area with other competing market areas in the country!

http://money.cnn.com/2006/02/14/real_estate/NAR_fourth_quarter_sales/index.htm

Nations Top Spot for Housing Appreciation in 2005...

Housing in Phoenix barely nabs top market, from the Arizona Republic, reports that Metropolitan Phoenix snagged the nations top spot for housing appreciation in 2005, with housing prices soaring 48.9% during the year. Most of the growth occured in the first three quarters of 2005, and prices only grew 1% by the end of the fourth quarter, signaling a cooling of the market. The numbers were from the National Association of Realtors (NAR). The median price of an existing Valley home now sits at $257,000, down from the $260,000 in December. Jay Butler of the Arizona Real Estate Center at ASU estimates that speculators and investors inflated metropolitan Phoenix home prices by as much as 25 percent in 2005.

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NE Valley Home Prices Soar Above $1 Million...

NE Valley home prices soar above $1 million, from the Arizona Republic , reports that the buy-in for new north Scottsdale homes is nearly $750,000 and a new custom home in the Silverleaf neighborhood of DC Ranch is in escrow for almost $10 million. In addition, the Toll Bros. Saguaro Estates subdivision southwest of Dynamite and Scottsdale Roads has new homes starting in the low $1,000,000's. It is yet another sign of the times in the northeast Valley where the new-home market is out of reach of all but the wealthiest buyers. Jay Butler, director of the Arizona Real Estate Center at ASU, said appreciation has pushed prices to more than $1 million for mass-produced homes in Scottsdale.

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Condo Project Planned for Blighted Area of Tempe...

10-story condo project planned for blighted area of Tempe, from the Arizona Republic, reports that a 10-story condo project may be built along a stretch of Apache Blvd. that staddles the Loop 101. The development, named Tempe Union Station Lofts, would be the first upscale, private development in the area in years. The development still needs to go before the city's Planning and Zoning Commission and City Council for approvals. The Lofts are hoping to cash in on middle-income folks who will be lured by easy access to two light-rail stops and the Loop 101 freeway, only a half-mile away. "Light rail is going to change the perception of how people get around," said Steve Barduson, the projects architect. The new buildings, one ten stories and one five, would include more than 400 condos, underground parking and retail with space for a restaurant. The design will be aimed at recent college graduates, baby boomers in the market for a second home, and anyone else looking to shun suburbia for an urban lifestyle, Barduson said.

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Resale Home Prices Slip Since Sept...

Resale home prices slip since Sept. in SE Valley, from the Arizona Republic , reports that home prices have been falling in some SE Valley cities over the last few months. Ahwatukee Foothills median price was $357,500 in January, down from $386,250 in December. Mesa's $240,000 fell from $243,500 in September. Jay Butler believes some neighborhoods and communities will see more price declines than others. He believes that closer-in locations such as Tempe or Ahwatukee Foothills or those with jobs close to homes will probably hold their values better, while areas farther out could see declines or not appreciate as much.

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Valley Home Resales Slow, But Prices Continue To Rise...

Valley home resales slow, but prices continue to rise, from the Phoenix Business Journal , reports that there were 5,260 recorded resales in January 2006, down from the 6,480 sales in December 2005 and down from the 9,360 sales in January 2005. The information was from the Arizona Real Estate Center at ASU. Jay Butler, Director of the Arizona Real Estate Center, said "the primary news of last year's housing market was the rapid rise in median home price from $194,000 in January to $260,000 in December. However, since the record of $263,000 was set in September, the growth rate has disappeared, with the median price being $257,000 in January, which is still well above last year's $194,000." In January 2006, 19 percent of all recorded sales were for homes priced from $120,000 to $199,999, 41 percent for $200,000 to $299,999, and 36 percent for homes priced over $300,000.

http://phoenix.bizjournals.com/phoenix/stories/2006/02/06/daily55.html?t=printable

The Major Driver in The Region's Growth is Residential...

Report: All segments of real estate market likely to keep growing, from the Phoenix Business Journal, reports that Metro Phoenix is expected to experience more economic gains this year because of continued growth in all sectors, from residential to commercial, retail, office and industrial, according to a new report from CB Richard Ellis' Phoenix office. The major driver in the region's growth is residential housing, in which there were more than 63,000 permits issued for new homes in the Valley in 2005. CB Richard Ellis Managing Director Gregory Coxon said, "will we have another record this year---I'm not ready to say that, but I think it's going to be a darned good single-family housing market." With regard to growth in the outlying areas, he added, "I'm not sure if the boundary ends at Casa Grande of Eloy, or beyond. Where is the edge today? I'm not sure I know." The article states that the Valley's industrial vacancy rate is only 5.5 percent and still declining. By the end of 2006, the Valley's office vacancy rate is expected to be 11.5 percent, down from the 12.6 percent at the end of 2005.

http://phoenix.bizjournals.com/phoenix/stories/2006/02/06/daily50.html?t=printable

SW Valley Cities Push I-10 Update...

SW Valley cities push I-10 update, from the Arizona Republic, reports that the Avondale, Buckeye and Goodyear city councils are considering asking voters to approve a sales tax that would amount to 1 to 2 cents on every $10 to go toward speeding up improvements to Interstate 10. The focus is on the SW Valley stretch of Interstate 10 where the areas staggering growth is fueling fears that traffic, already congested, will get even worse. With no early intervention, I-10 is slated for improvements in 2011 and 2021, according to the schedule set out by Proposition 400 which voters approved in November 2004. Southwest Valley leaders would rather see it start in 2007.

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Fore Sale: Buy Me!!!

Fore sale: Buy me!, from the Arizona Republic, reports that the number of homes for sale in metro Phoenix has nearly tripled in the past year, based on December data from the Arizona Regional MLS. Listings are up and houses are taking more time to sell as buyers regain the upper hand in the Valley's volatile real estate market. Reasons given for the increase in listings include speculative investors who are leaving the market after realizing gains of 40 to 50 percent in the last year, rising mortgage rates, and prices that have excluded many buyers from the market. According to a local Realtor, "if it doesn't pick up, sellers might have to mark down homes more than they expected to get the attention of the few buyers that are out there. The market moved 50 percent in one year. This may be the morning after." Jay Butler, director of the Arizona Real Estate Center at ASU says "people reach a point where they say, 'I can't afford this,' If prices and rates move up, we're in deep trouble."

http://www.azcentral.com/php-bin/clicktrack/print.php?referer=http://www.azcentral.com/arizonarepublic/business/articles/0208morehouses08.html

Lawmakers Begin Work on Land-Fissures Bill...

Lawmakers begin work on land-fissures bill, from the Arizona Republic, reports that state legislators began discussion Monday on a bill that would give homeowners and buyers more accurate information about the location of land fissures. Problems with fissures caught many new home buyers in the SE Valley by surprise, after heavy rains last spring opened giant fissure cracks on the properties of several Pinal County residents. Earth fissures have become more prevalent as growth has pushed out toward the agricultural fringe of the Valley. Outcry about the fissures prompted the Arizona Association of Realtors and elected officials to draft House Bill 2639, which aims to ensure that buyers receive truthful information about fissures when they buy property. Pinal and Maricopa counties have tools to research problem areas available on their Web sites: www.co.pinal.az.us and www.maricopa.gov.


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Bush Budget Proposes FHA First-Time Homebuyer Loans...

The Bush administration announced this week that it will propose two new zero-downpayment Federal Housing Administration mortgage loans to help first-time buyers.

The first program will offer first-time buyers with strong credit records a loan to finance 100 percent of a home purchase price, including closing costs.

A second program will help buyers with limited or weak credit histories by initially charging a higher mortgage insurance premium that declines after a period of on-time payments.

The White House also proposed an overhaul to the FHA premium structure from a flat fee charged regardless of the borrower’s risk of default to a tiered pricing structure based on the borrower’s risk. The new plan would reword credit-worthy borrowers and more fairly charge those who represent greater repayment risks.

Source: Reuters News (02/06/06)

Home Buyers in a Squeeze...

Home buyers in a squeeze, from the Arizona Republic,
reports that skyrocketing prices have made Valley resale homes harder to
afford than any time since the beginning of the last decade. The Arizona
Real Estate Center at ASU just released its latest affordability index for
new and resale homes. The resale index fell to 84 in 2005, down from 114 in
2004. The new home index dropped from 102 to 80 during that same time. The
index is based on the value of 100 being the level where a typical buyer
can afford a median-priced home at current interest rates and household
income. Numbers higher than 100 signify increased affordability and those
below 100 suggest the opposite. The new figures have implications for
everyone associated with the Valley's real estate market, from agents to
owners to businesses worrying if their employees can find a place to live.
"If you are trying to buy a home, you have to be careful about what you are
doing," said Jay Butler, director of the Real Estate Center at ASU. "If you
own a home, you don't have an affordability issue. If you are trying to
sell this area as a place for a new company, then you may have some serious
issues."
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Top 40 Job Growth List...

State puts five cities in top 40 job growth list, from the Phoenix Business Journal, also reports on the job growth list, and adds that in addition to Phoenix leading the nation in job growth and coming in second in job-growth rate, Yuma ranked fifth, Prescott ranked 10th, Flagstaff ranked 26th and Tucson ranked 40th in job-growth rate. To see the whole list of cities and their numbers, go to www.bls.gov.

http://phoenix.bizjournals.com/phoenix/stories/2006/01/30/daily51.html?t=printable

Metropolitan Phoenix Led the Nation...

Phoenix added most jobs, from the Arizona Republic, reports that Metropolitan Phoenix led the nation in absolute job gains from December 2004 to December 2005, adding 83,200 jobs to its economy, according to figures released by the federal Bureau of Labor Statistics. Washington DC was second with 81,600 jobs. This means that the Phoenix area created more new jobs than even such metropolitan goliaths as Los Angeles, New York and Chicago. What makes this even more amazing is that the Metro Phoenix area is only the 14th largest metro area in the country. The survey was gathered on 311 metropolitan areas across the nation. The report also found that the Valley's 4.8 percent job-growth rate was the second highest among 35 large metropolitan areas. The region's job gains mirrored the population growth of the last year, with the state adding 200,000 residents, most moving to the metro Phoenix area. Service-related jobs, which include retail jobs, made up the biggest segment of the area's workforce, with the construction industry also being a large contributor. This is more positive news for our local real estate market!

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34-Story Condo Tower Next to the Landmark Viad Building in Phoenix...

Calif. firm planning to build more condos, from the Arizona Republic, reports that San Diego developer Joe Pinsonneault wants to build a 34-story condo tower next to the landmark Viad building in Phoenix. He paid $2.9 million for the one+ acre site on the west side of Central south of Palm Lane. Pinsonneault said he plans 327 luxury units at an average price of $600,000 to $700,000. The owners of the Viad Building, a New York investment group and a Mississippi REIT have doubts. Mitch Mattingly, and executive vice president of the REIT, said "we are unsure how deep the high-rise condominium market is in Phoenix and because of that would hate to see a developer go out there and speculate on something that does not work." Residential developers are transforming Central Ave. from an office hub to an "urban living" haven due to interest in city living, a planned light-rail line that runs along Central and the quick profit potential of building and selling condos compared with building and owning an office project.

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Projected Growth in the SW Valley...

A look into SW Valley's crystal ball, from the Arizona Republic, reports on the projected growth in the SW Valley from the Maricopa Association of Governments (MAG). MAG projects that by 2030, Goodyear is expected to have 330,000 residents, and Buckeye is expected to have 380,000. Currently, Goodyear has 42,000 residents and Buckeye has 35,000. Planners expect Avondale, now with about 62,000 residents, to grow to 160,000 by 2030. MAG's new projections are expected to be released in September or October. Scottsdale architect and urban planner Vern Swaback says the Valley's future in another hundred years is hard to visualize. "If you look back a hundred years... what exists there today would have been equally unimaginable", Swaback stated. Take Buckeye as a case study. It took the Phoenix-metro area to grow to its current size and scope. Swaback expects Buckeye's growth will zoom ahead and expand with that kind of fever in about a decade.

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