It wasn’t your first choice. It wasn’t your second either. In fact, the short sale you wrote the offer on was likely more a product of attrition than anything else.

Short sales take time. Like most astute 2012 home buyers, you are all too aware that the offer you submit on an upside-down property will likely take a minimum of 60 days for a response from the seller’s lender. You are also aware that the list price of the home is not necessarily reflective of the price that the lender will ultimately be willing to accept. If you are like many buyers I encounter, the cumulative uncertainty of a short sale transaction is likely what ultimately convinced you to first trawl the regular resale and/or foreclosure market for a home before turning your attention to short sale candidates. Fact is, unless you are an investor or in no hurry to move out of your month-to-month lease, you likely don’t have the luxury of waiting on an uncertain outcome.

With the pace that the good homes are selling in early 2012 due to a heightened demand and greatly reduced inventory (approximately 18,250 active property listings in the Arizona Regional MLS at the time of this post), it is also likely that you have either lost out on a property or five to competing buyers or become disenfranchised with the lack of choices.

Enter the Placeholder House.

Or not.

You see, in recent years it has become en vogue for buyers and their agents to tie up a short sale while continuing to look for a more expedient and/or desirable option. Utilizing a standard AAR (Arizona Association of Realtors) short sale addendum, you don’t have to deposit earnest funds, complete inspections, pay for an appraisal or otherwise commit yourself to the transaction until you get the yea or nay from the seller’s lender.

In essence, you get to tie the property up for free. If something better pops up while the bank is going through its laborious machinations, you can bounce at a moment’s notice. Sounds like the perfect backstop, right?

Not so fast, my friend.

Wising up to the ploy, short sale sellers and their capable agents have taken to adding penalties to such indiscriminate escrow hopping. The shrinking inventory means that there is more competition from your fellow buyers on short sale properties, too. No longer do the better opportunities lie all over the market, waiting for an indifferent buyer to pick them. They are sought after commodities. As such, you can expect to encounter terms such as non-refundable earnest money placed in escrow upon seller acceptance of your offer (before it is submitted to the bank for approval) for the first 60 days (or until bank response, whichever comes first). Some short sale list agents have taken to demanding that the inspection period begin upon seller acceptance as well.

These are measures undertaken to tie you into the deal; they provide you with a vested interest in sticking around for an approval rather than discarding them for the first best alternative that comes down the pike.

If you enter a short sale transaction in 2012, it’s best you leave the placeholder mentality where it belongs: 2010.

Time to abandon the contractual hedging of bets and get back to entering a purchase agreement with the intention of buying a house, lest you get stuck in a purchase you only sort of want to make.

Short sales: they aren’t just for Real Estate philanderers anymore.

Tired of getting your teeth kicked in by competing buyers on the homes you try to buy? Wonder what sellers are thinking when they reject your offer time after time?

You’ve landed on the right blog. Let’s take a quick look at a few critical components of an offer through a seller’s eyes to find out exactly what is keeping that elusive new home out of your reach.

• Pre-Qualification

This is a big one, particularly in a competitive situation in which the seller is entertaining multiple offers at the same time. Back in the day, virtually anyone with a pulse was a good bet to secure the necessary financing to complete a transaction due to lax qualifying standards. These days, the banks want a faxed copy of your baby as a pre-funding condition. As such, you are banging your head against the wall if you don’t have an iron-clad pre-qualification letter from your lender to present with your offer. And I’m not talking about a bare bones letter in which the qualification is based solely upon a conversation, you’re going to want to have the boxes checked that indicate your pre-qual (pre-approval is even better) is at minimum based upon a tri-merged credit report and review of recent bank statements. Got two years of tax returns and recent pay stubs to your lender already? Even better.

Don’t save the pre-qualification step for the last minute when you’re frantically trying to submit an offer on a hot, new listing. Taking the time to prepare a rock solid pre-qual in advance can be the difference between being a buyer and being a shopper.

• Financing Type

Most buyers are somewhat hamstrung on their financing options these days as down payment options tend to dictate the ultimate vehicle chosen. That said, it is important for you to know what the seller sees as a limitation of each loan type so as to find a way to overcome the likely objection(s) within the framework of your program.

FHA Loans - Dormant, by and large, during the boom when low (and even no) down payment options were plentiful in conventional financing, FHA loans have made a comeback in a big way in the Scottsdale market. Sellers will have two major concerns with your FHA offer.

First will be closing costs. As most people opt for FHA because it opens up the door to a 3.5% down payment, it is not uncommon for these buyers to have a little less saved up for the closing costs that piggyback a home purchase. If you are loading 1-3% of your costs onto the seller, be mindful that you are not actually offering the price you put on the first page of the contract. All that matters to the seller is the net. If you are trying to get your closing costs covered, you might have to boost your offer price commensurately.

For example, your 150k offer on a 150k listing is not truly full price if you are asking the seller to pay 5k in closing costs. To make your offer reflect an effective net full price, you’ll need to offer 155k.

And hope the appraisal can justify that amount.

Which leads us to the second major financing concern, the appraisal itself. Not only do FHA loans require FHA-certified appraisers who scrutinize the condition of the property for inhabitability (no exposed wires, utilities must be on and functional, etc), but sellers and their agents will expect the appraiser to be far more conservative with the ultimate evaluation due to the high loan to value ratio. The lower the down payment, the higher the risk to the bank. That tends to bring a little more heat down on the appraiser to bring in a value that will survive heightened scrutiny from a constipated underwriter.

VA Loans - VA loans are like their FHA cousins on steroids, at least from a seller’s perspective. We all love our troops … until they try to buy our homes. A seller sees your 100% financed loan and does not see an army of one, he sees an even more anal retentive appraiser and underwriter who would like nothing better than to blow up the sale of his home.

Peeling paint in a home built before 1978 (subject to lead)? He’s gonna have to scrape it and repaint.

Last good round of sales comps older than six months old? That’s bad enough on a conventional loan in which the bank is only investing 80% of the home’s value, but at 100%?

Shoot …

Sellers also expect to get stuck with buyer closing costs (sellers MUST pay certain costs with a VA loan), so it’s not the favored financing type for many.

Let us not forget about the time factor. Most lenders will want about 40-45 days to process both FHA and VA loans, due in large part to the red tape created by the government backed programs. For the seller who wants a more standard 30 day close, this is not as appealing. You might have to build in some additional incentive for the seller to select your offer with the longer close, such as additional earnest money at the midway point, slightly higher purchase price, etc.

Conventional Financing - Conforming to Fannie Mae guidelines, conventional loan programs typically require higher down payments (5-20%) than their kin. Sellers like this because it means you have more ‘skin in the game’. The appraisal is less of a white-knuckle experience given the lower LTV (loan to value ratio), and the seller expects you will be much more likely to ultimately secure the loan and close escrow. While certainly not outside the realm of possibility, a 20% down conventional buyer is less likely to ask a seller for closing cost assistance.

Outside of the cash offer, the granddaddy of them all, conventional financing is looked upon most favorably by most sellers.

• Down Payment 

Touched on this above, but bears isolating for repeat. The more money you are showing as a down payment in your offer, the stronger I, as a seller, think you are and more likely to close. Your lender will not be as hypercritical in approving a loan with 60% LTV versus 95%. The appraisal will be less of a hurdle, and failing to hit the sales price won’t be insurmountable (you have the resources to pony up cash to bridge the shortfall). Further, I expect you have some leeway on potential inspection issues if you have deeper pockets. The guy putting everything he has in the world together to complete the purchase won’t have much room to make improvements/repairs after closing.

That scares me as I expect you are going to try to kick my ass for every loose screw and squeaky hinge in the inspection report.

Cha-ching.

• Earnest Money

One of the easiest places to score points with the seller is the bolstering of the ‘good faith’ money you place in escrow upon contract ratification. In our market, 1-3% would be considered a typical earnest deposit. The more you can put down, the more appealing to the seller. With several ‘outs’ along the way to reclaim this money in the event of a poor home inspection, loan denial, low appraisal, etc, the shrewd buyer will offer to place an eye-catching deposit in escrow. If the deal goes south, provided that it is not due to your own breach of contract, this money is recoverable. If the deal goes through to closing, it is applied to the total due at closing. It IS NOT an additional fee.

If you can afford to do so, go outside the box a little with your earnest deposit when you know you are competing against other buyers. It doesn’t end up costing you anything more unless you breach the terms of the deal.

Don’t do that.

If you reflected, say, $500-1000 in earnest money on your last stab at a $200,000 house, you limped in with your offer, regardless of the accompanying terms. Show weakness in the good faith money you show me, and I think you are either a) not committed to the deal, b) broke or c) both.

• Terms

Believe it or not, sellers pay attention to those little throwaway items in the contract outside of price and ability to close.

That home warranty policy you want the seller to pay? That’s $350-550 off the bottom line. While a typical buyer request, you need to be cognizant of circumstance before automatically checking the ‘seller’ box in the contract. Is it a bank property? Are there other offers on the table (or likely to be due to the great value, time on market, etc)? Might want to rethink its inclusion in some cases.

Likewise, don’t check the boxes in the HOA addendum (if applicable) loading all transfer cost onto the seller without some thought. If it comes down to you and another comparable offer, don’t be the guy that sabotages himself over a couple hundred bucks.

The inclusion of personal property in your offer can be a mistake in a competitive market. Sure, those Maytag Neptunes are great, but do you really want to scuttle your chances of getting the house over the washer and dryer? You can ask for the fridge if there are no other offers at play. Deal?

Writing your offer subject to the sale of a current residence? That’s a huge no-no in a competitive situation. As a listing agent, I tell my seller that there is still a property that needs to sell for the deal to work, so you are no closer to the closing table. Worse, you now have no control over the property being sold. Banks and short sale sellers feel the same way. Get your home sold before approaching sellers if you want to stand a chance in a competitive arena.

Give the seller his/her preferred title company. This one is easy. As long as the company is reputable, it’s easy to score points with the other party by acquiescing on items that don’t cost you anything. A pre-requisite of purchasing a bank property to accept the seller’s choice of title company, it’s not a bad idea to include the question of “Does the seller have a title preference?” in the conversation with the listing agent that precedes your offer on a mom & pop resale, too. You know, the same conversation in which you ask about preferred closing dates and such?

Purchasing ‘As Is’ is fairly common in the current market as few sellers have the equitable wherewithal to actually make repairs. If you are looking at short sales and foreclosures, it is a given. You can sweeten the deal for a resale seller and differentiate your offer from competing ones by making your offer ‘As Is’ for his property as well. If framed properly, you will still maintain your full rights to a property inspection, with the ability to cancel the transaction if the home’s deficiencies are too numerous/costly. You alleviate the seller’s obligation to repair broken items, but you are not obligated to complete the transaction if you are dissatisfied. Offering to purchase ‘As Is’ can be a good tie-breaker in a multiple offer scenario, but employ with caution.

And for Pete’s sake, don’t let your agent write a short story’s worth of verbiage into the constructive language section of the contract. Not only do agent’s get themselves and their clients into trouble by unwittingly practicing law through the amateur construction of legal terms, but filling this page up is the antithesis of a ‘clean’ offer. Keep it simple, and don’t scare the seller off with Perry Masonesque flair. Half the stuff that shows up here with regularity is already covered (more adequately at that) in the boilerplate.

Remember: The AAR contract is nine pages (plus addenda) of carefully crafted legal verbiage that was composed by attorneys smarter than you and your agent.

• Price

I saved this one for way down the page because it should be the most self-evident truth this side of pain hurts. You lose the privilege of complaining about non-accepted offers if you keep trying to negotiate more off the asking price than the market permits.

• The Listng Agent Never Received Your Offer

Your offer was good. Your offer was clean. The home will be yours by Halloween.

Or it would have been had the listing agent ever received it.

Sad but true fact, I have received numerous offers over the years without so much as a headsup call that one was on the way, let alone a followup call from the buyer’s agent to confirm that it actually arrived. For all you know, the offer you spent a day or two considering and several hours drafting might have ended up in a spam folder or faxed to Sri Lanka if that simple precautionary step is not taken.

Inconceivable? It happens all the time.

Further, if you don’t let the listing agent know an offer is en route, you risk the possibility of the seller accepting another offer in the interim.

Don’t let your agent be lax. Make sure your offer gets where it’s going.

Sidenote: When I receive an emailed/faxed offer that is not preceded by so much as a phone call from the buyer’s agent, I know it’s going to suck. Food for thought.

• You Are Competing for the Wrong Properties

Allow me to move from the seller’s side of the table back to yours, doffing my cap as your friendly buyer’s agent. If you keep losing properties despite gussying your offers up in accordance with the advice herein to make them as attractive as possible to unimpressed sellers, it is quite likely that you have simply set your self up for failure by targeting the wrong homes. This phenomenon is most prevalent in the lower price ranges where investors and second home buyers make it difficult for cash-strapped, first-time buyer to compete. Competing against cash or high down payment conventional financing, the poor SOB writing clean, full-price FHA offers doesn’t stand much of a chance.

Stop throwing your hat in the ring on properties you won’t get unless you really don’t care for your hat. Cause it’s gonna get trampled.

You will have much better chances for success by targeting homes priced a little higher and negotiating down rather than starting at the basement where the Daddy Warbucks of the world are busy chasing the prices up.

Go find the lonely seller who is priced just above the scrum.

Getting drubbed in the bidding wars at 150k? Look at the inventory for comparable properties at 175k. Odds are, despite the discrepancy in list prices, the ultimate selling prices won’t end up that far apart.

Bolster the weak points in your offers, isolate the right properties and you, too, can have success in this market.

Now get back out there and make someone an offer they can’t refuse.

One of the more confounding logistical quandaries that can arise in Real Estate is the classic chicken or the egg paradigm: Does one sell a house before knowing where he is moving, or does one buy a new house without having his current one sold?

No doubt, the dilemma of which cap to doff first has vexed many a consumer. Selecting the correct course of action is dependent, like most things, on a variety of factors. For the sake of clarity, we will keep things simple.

If you have a boatload of equity in your current home, have flexibility with the ultimate selling price and have the financial wherewithal (cash in hand or the ability to obtain a new loan that is not conditional upon the sale of your home) to purchase a new home prior to selling your existing one, then you are the rare individual in the enviable position to call your shot. To eliminate the prospects of a double move and the fear of obligating yourself to the sale of your home without clear knowledge of where you are heading, you will likely opt to buy first. Especially if you are not convinced that the home of your dreams is lurking in the market at present, it makes sense to locate the next property before committing yourself to the rest of the process.

As most buyers are reliant upon the proceeds from their current house to purchase a new home, however, the above scenario is a pipe dream for the less well-heeled. Most will face the stark reality that they are simply hamstrung on a purchase until they sell their existing house.

So how does one combat the fear of committing to destinations unknown when putting a home on the market?

The ideal method is to negotiate a purchase that is conditioned upon the ultimate sale of your home, but few and far between are the sellers who will entertain straight contingent offers of that ilk. The preponderance of bank owned properties and short sales in the present market makes the task even more arduous as contingent offers are simply not entertained by the banks. Only the most patient seller will take a flyer on an offer from someone who has to sell a property to make the deal work. And if you happen to find such a rare bird, you’ll likely have to overpay for the home due to the weakness of your position.

When purchasing first or conditionally is not an option, the best compromise is to make your offers after you have accepted a contract on the home you are selling, but before it has closed escrow. With a buyer in hand, it is considerably easier to approach another seller with an offer. More attractive than a straight contingency in which you still have to line up a willing buyer, you can structure your offer to be subject to the successful close of escrow of the contract currently in place. This is not only more appealing to the seller, but if you have negotiated a longer close of escrow on the home you are selling, you can build in a little time to locate a property and negotiate a contract, thus avoiding a dreaded double move. Timing the closings can be tricky, but if done correctly, you can move directly from one home to the other without having to put your gear in storage while you, the kids, your dog Sadie, and the goldfish check into the Holiday Inn for a few weeks.

Naturally, to make this scenario work perfectly, you have to do your homework in advance. Even prior to listing your home for sale, start looking online at the available inventory. Get in the car with your agent to look at homes that fit your parameters. Get preapproved with your lender so that you are ready to pounce at a moment’s notice, as the right home for you is often right for someone else, too. Wasting time getting your preapproval in place after you find the property opens the door to not only unrealistic window shopping, but losing an ideal candidate to a buyer who is one step ahead. Do your due diligence up front and you’ll be ready to enter the scrum as soon as your home attracts a buyer.

To be sure, coordinating the near simultaneous buying and selling of homes is a stressful undertaking. You will experience Exorcist moments in which your head spins around a full 360 degrees. Understanding the process and the steps you can take to increase your chances of success will limit the projectile vomiting, however.

So which comes first, the chicken or the egg?

It varies from coup to coup, but in the end, it’s all protein.

Are you shopping in the distressed aisle for your McCormick Ranch home? Make sure to look up.

While the purchase of a bank owned home or a short sale tends to be fraught with a little more risk than a traditional resale transaction, it is important to note that buyers typically maintain inspection rights on distressed properties. While the various “As Is” clauses and addenda dictate that the seller is not responsible for making repairs on these properties, most purchases involving bank properties do allow for an inspection period (though the time frame may be shrunk from the typical 10 days allowed under the boilerplate of the standard Arizona Association of Realtors contract).

*In short, the bank won’t likely fix anything, but you are allowed to verify condition before deciding whether or not to continue with the transaction.

During the course of your inspections, it is always prudent to spend a little extra time on a bank property as there are no disclosures of prior defects. The institution that now owns the property never occupied it, and knows nothing about its history other than the pertinent fact that the previous owner defaulted on his/her deed of trust.

It’s all about the Benjamins to the bank.

The purpose of this lengthy preamble? To add a little context to the freak hail storm that struck large pockets across the Valley last (2010) fall. If you have been watching all of the new roofs going up over the past six months, you know that the McCormick Ranch area was hit hard. With insurance companies passing out full roof replacements like they were candy, it is not uncommon to see streets where virtually every home features a brand new roof. Foam and asphalt shingle roofs, in particular, took wicked beatings.

So while most owner-occupied properties in the area that sustained damage have been repaired or replaced, the bank-owned properties that have been sitting vacant for over a year are likely to leak like a sieve when the monsoons roll around this July. The price points of such properties are often attractive enough to offset the 10-20k many will need, but it can be tough to swallow when it is not an anticipated cost.

Before plunking down money on inspections and appraisals, I’d recommend having a professional walk the roof of that bank owned steal to help you determine the true out of pocket price of ownership.

Oh, and if you are buying a resale property in McCormick Ranch? Make sure to find out if the seller had any repair work performed in the aftermath of said storm. While one of our selling clients was able to obtain full roof replacement on a claim from that storm as recently as this past month, the likelihood of that happening on another property dwindles the further removed we get from the event. The insurance companies aren’t going to be in the roof replacement business much longer.

Happy hunting,

Ray & Paul

Buying or selling a home in the McCormick Ranch area? Give us a call. Online data and pictures can give you 90% of the picture. We’ll fill in the remaining 10%.

*Do not rely on any general statements herein as legal advice. We are not attorneys, nor do our statements pertain to a specific transaction. Rights and restrictions within a transaction vary depending upon the documents used, attendant verbiage, alterations, etc.  Long disclaimer short: I ain’t talking about your deal, homie.

Looking for new construction homes in Scottsdale and the greater Phoenix area? You’ve come to the right place. Find your city of choice below and follow the links to a full list of all new homes currently listed for sale in the Arizona Regional MLS.

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New Homes in Scottsdale

Showing properties 1 - 5 of 111. See more New Construction Homes in Scottsdale.
(all data current as of 2/5/2012)

1. $1,360,000 : 18975 N 101st Street, Unit 10, Scottsdale
   
   3 beds, 3.00 baths

   Home size: 2,688 sq ft

   Lot size: 7,920 sq ft

   Year built: 2012

   Parking spots: 3

   Days on market: 2
   
2. $1,095,000 : 38525 N 103rd Place, Scottsdale
   
   3 beds, 3.50 baths

   Home size: 4,400 sq ft

   Lot size: 1.05 ac

   Year built: 2012

   Parking spots: 3

   Days on market: 3
   
3. $1,760,000 : 18887 N 101st Way, Unit 31, Scottsdale
   
   4 beds, 4.50 baths

   Home size: 3,540 sq ft

   Lot size: 11,276 sq ft

   Year built: 2012

   Parking spots: 6

   Days on market: 3
   
4. $1,180,000 : 7277 E Camelback Road, Unit 607, Scottsdale
   
   2 beds, 2.50 baths

   Lot size: 1,686 sq ft

   Year built: 2011

   Parking spots: 4

   Days on market: 4
   
5. $1,440,000 : 7277 E Camelback Road, Unit 702, Scottsdale
   
   2 beds, 2.50 baths

   Lot size: 1,914 sq ft

   Year built: 2011

   Parking spots: 4

   Days on market: 4
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

New Homes in Paradise Valley

Showing properties 1 - 5 of 28. See more New Construction Homes in Paradise Valley.
(all data current as of 2/5/2012)

New Homes in Cave Creek

Showing properties 1 - 5 of 25. See more new Construction Homes in Cave Creek.
(all data current as of 2/5/2012)

1. $359,990 : 6434 E Military Road, Unit 107, Cave Creek
   
   2 beds, 2.50 baths

   Home size: 2,450 sq ft

   Lot size: 1,557 sq ft

   Year built: 2012

   Parking spots: 2

   Days on market: 3
   
2. $379,990 : 6434 E Military Road, Unit 106, Cave Creek
   
   3 beds, 2.50 baths

   Home size: 2,450 sq ft

   Lot size: 1,557 sq ft

   Year built: 2012

   Parking spots: 2

   Days on market: 3
   
3. $879,888 : 5508 E Palo Brea Lane, Cave Creek
   
   4 beds, 3.50 baths

   Home size: 3,471 sq ft

   Lot size: 12,869 sq ft

   Year built: 2010

   Parking spots: 3

   Days on market: 4
   
4. $724,900 : 5241 E Baker Drive, Cave Creek
   
   3 beds, 2.50 baths

   Home size: 3,228 sq ft

   Lot size: 13,974 sq ft

   Year built: 2011

   Parking spots: 3

   Days on market: 7
   
5. $459,000 : 36464 N 58 Street, Cave Creek
   
   4 beds, 2.00 baths

   Home size: 2,315 sq ft

   Lot size: 39,730 sq ft

   Year built: 2011

   Parking spots: 3

   Days on market: 8
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

New Homes in Fountain Hills

Showing properties 1 - 5 of 5. See more New Construction Homes in Fountain Hills.
(all data current as of 2/5/2012)

1. $969,000 : 15719 E Telegraph Drive, Fountain Hills
   
   4 beds, 6.00 baths

   Home size: 6,374 sq ft

   Lot size: 14,183 sq ft

   Year built: 2011

   Parking spots: 3

   Days on market: 8
   
2. $2,700,000 : 9236 N Horizon Trail, Fountain Hills
   
   4 beds, 3.50 baths

   Home size: 5,915 sq ft

   Lot size: 1.04 ac

   Year built: 2010

   Parking spots: 3

   Days on market: 93
   
3. $1,983,000 : 10914 N Arista Lane, Fountain Hills
   
   4 beds, 4.50 baths

   Home size: 6,922 sq ft

   Lot size: 1.98 ac

   Year built: 2012

   Parking spots: 4

   Days on market: 184
   
4. $1,540,000 : 12352 N Cloud Crest Trail, Fountain Hills
   
   4 beds, 4.50 baths

   Home size: 5,558 sq ft

   Lot size: 1.00 ac

   Year built: 2012

   Parking spots: 3

   Days on market: 314
   
5. $990,000 : 9504 N Desert Wash Trail, Fountain Hills
   
   4 beds, 4.50 baths

   Home size: 5,400 sq ft

   Lot size: 20,077 sq ft

   Year built: 2011

   Parking spots: 4

   Days on market: 348
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

New Homes in Chandler

Showing properties 1 - 5 of 59. See more New Construction Homes in Chandler.
(all data current as of 2/5/2012)

1. $559,900 : 3435 E San Carlos Place, Chandler
   
   5 beds, 5.50 baths

   Home size: 3,940 sq ft

   Lot size: 18,063 sq ft

   Year built: 2011

   Parking spots: 3

   Days on market: 2
   
2. $599,000 : 2051 E Kaibab Place, Chandler
   
   5 beds, 4.00 baths

   Home size: 4,004 sq ft

   Lot size: 15,600 sq ft

   Year built: 2012

   Parking spots: 4

   Days on market: 2
   
3. $306,166 : 4700 S Fulton Ranch Boulevard, Unit 69, Chandler
   
   3 beds, 2.00 baths

   Home size: 1,876 sq ft

   Lot size: 6,012 sq ft

   Year built: 2012

   Parking spots: 2

   Days on market: 8
   
4. $305,228 : 4700 S Fulton Ranch Boulevard, Unit 68, Chandler
   
   3 beds, 2.50 baths

   Home size: 2,287 sq ft

   Lot size: 4,306 sq ft

   Year built: 2012

   Parking spots: 2

   Days on market: 8
   
5. $277,421 : 4700 S Fulton Ranch Boulevard, Unit 67, Chandler
   
   3 beds, 2.00 baths

   Home size: 1,797 sq ft

   Lot size: 5,693 sq ft

   Year built: 2012

   Parking spots: 2

   Days on market: 8
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

New Homes in Gilbert

Showing properties 1 - 5 of 92. See more New Construction Homes in Gilbert.
(all data current as of 2/5/2012)

1. $178,900 : 3927 E Kesler Lane, Gilbert
   
   4 beds, 2.50 baths

   Home size: 2,250 sq ft

   Lot size: 4,278 sq ft

   Year built: 2011

   Parking spots: 2

   Days on market: 1
   
2. $295,000 : 2554 E Donato Drive, Gilbert
   
   4 beds, 2.50 baths

   Home size: 2,692 sq ft

   Lot size: 8,400 sq ft

   Year built: 2012

   Parking spots: 3

   Days on market: 2
   
3. $258,432 : 3542 E Megan Street, Gilbert
   
   4 beds, 2.50 baths

   Home size: 2,478 sq ft

   Lot size: 7,110 sq ft

   Year built: 2012

   Parking spots: 3

   Days on market: 2
   
4. $510,000 : 3086 E Blue Sage Road, Gilbert
   
   5 beds, 3.25 baths

   Home size: 4,270 sq ft

   Lot size: 10,045 sq ft

   Year built: 2010

   Parking spots: 5

   Days on market: 3
   
5. $299,900 : 2689 E Narrowleaf Drive, Gilbert
   
   5 beds, 4.00 baths

   Home size: 3,769 sq ft

   Lot size: 6,900 sq ft

   Year built: 2010

   Parking spots: 3

   Days on market: 6
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

New Homes in Glendale / Peoria

Showing properties 1 - 5 of 82. See more New Construction Homes in Glendale / Peoria.
(all data current as of 2/5/2012)

1. $228,241 : 21161 N 98th Drive, Peoria
   
   4 beds, 2.00 baths

   Home size: 2,141 sq ft

   Lot size: 6,435 sq ft

   Year built: 2012

   Parking spots: 3

   Days on market: 9
   
2. $227,577 : 21166 N 98th Drive, Peoria
   
   4 beds, 2.00 baths

   Home size: 2,264 sq ft

   Lot size: 6,325 sq ft

   Year built: 2012

   Parking spots: 2

   Days on market: 9
   
3. $224,091 : 21156 N 98th Drive, Peoria
   
   3 beds, 2.00 baths

   Home size: 2,095 sq ft

   Lot size: 6,527 sq ft

   Year built: 2011

   Parking spots: 2

   Days on market: 9
   
4. $295,000 : 8326 W Softwind Drive, Peoria
   
   3 beds, 2.00 baths

   Home size: 1,687 sq ft

   Lot size: 1.00 ac

   Year built: 2010

   Days on market: 10
   
5. $571,512 : 7529 W Trails Drive, Glendale
   
   3 beds, 3.50 baths

   Home size: 3,398 sq ft

   Lot size: 16,523 sq ft

   Year built: 2011

   Parking spots: 4

   Days on market: 17
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

New Homes in Mesa

Showing properties 1 - 5 of 54. See more New Construction Homes in Mesa.
(all data current as of 2/5/2012)

1. $228,375 : 4448 S Hassett Street, Mesa
   
   3 beds, 2.00 baths

   Home size: 2,112 sq ft

   Lot size: 7,638 sq ft

   Year built: 2011

   Parking spots: 2

   Days on market: 1
   
2. $135,845 : 2565 E Southern Avenue, Unit 73, Mesa
   
   3 beds, 2.00 baths

   Home size: 1,481 sq ft

   Lot size: 2,952 sq ft

   Year built: 2011

   Parking spots: 2

   Days on market: 2
   
3. $143,363 : 2565 E Southern Avenue, Unit 29, Mesa
   
   3 beds, 2.00 baths

   Home size: 1,559 sq ft

   Lot size: 2,952 sq ft

   Year built: 2011

   Parking spots: 2

   Days on market: 2
   
4. $399,900 : 7147 E Halifax Circle, Mesa
   
   4 beds, 3.00 baths

   Home size: 3,502 sq ft

   Lot size: 27,578 sq ft

   Year built: 2012

   Parking spots: 3

   Days on market: 2
   
5. $284,900 : 11312 E Stradling Avenue, Mesa
   
   4 beds, 3.00 baths

   Home size: 3,400 sq ft

   Lot size: 13,609 sq ft

   Year built: 2011

   Parking spots: 6

   Days on market: 3
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

New Homes in Tempe

Showing properties 1 - 5 of 7. See more New Construction Homes in Tempe.
(all data current as of 2/5/2012)

1. $300,000 : 2431 E Wesleyan Drive, Tempe
   
   4 beds, 1.75 baths

   Home size: 2,188 sq ft

   Lot size: 8,799 sq ft

   Year built: 2012

   Parking spots: 5

   Days on market: 1
   
2. $248,900 : 1414 S Terrace Road, Tempe
   
   3 beds, 3.50 baths

   Home size: 1,685 sq ft

   Lot size: 3,153 sq ft

   Year built: 2012

   Parking spots: 2

   Days on market: 12
   
3. $299,000 : 1300 W 5th Street, Unit 1003, Tempe
   
   3 beds, 3.00 baths

   Home size: 1,891 sq ft

   Lot size: 7,500 sq ft

   Year built: 2010

   Parking spots: 2

   Days on market: 96
   
4. $233,900 : 1404 S Newberry Lane, Tempe
   
   3 beds, 3.50 baths

   Home size: 1,685 sq ft

   Lot size: 3,153 sq ft

   Year built: 2011

   Parking spots: 2

   Days on market: 244
   
5. $233,900 : 1411 S Terrace Road, Tempe
   
   3 beds, 3.50 baths

   Home size: 1,685 sq ft

   Lot size: 3,153 sq ft

   Year built: 2011

   Parking spots: 2

   Days on market: 244
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Standard Addendum to Purchase Contract

Purchase Agreement for a First Bank of Asbestos (henceforth referred to as “Seller”) property is non-binding unless this addendum has been attached and fully executed by all parties. In the event of a dispute between the language of the Purchase Agreement (or subsequent addenda) and this addendum, the terms of this addendum shall prevail. Under no circumstances shall the terms of this addendum be altered by any party other than Mephistopheles himself.

Buyer, ______________________________, understands that the property located at _____________________________ in _______________________, _______ has been acquired through foreclosure (or similar jurisdictional process) by Seller. As such, Seller has no knowledge of the property’s history and makes no warranties, express or implied, as to its condition.

*Buyer acknowledges that Seller doesn’t know s&$% _________  (Buyer Initials)

In the unlikely event that Seller should learn anything about the condition or history of the property at any time during the course of the transaction, Seller still doesn’t know s&$%.

Buyer to include child’s pet bunny rabbit with all offers. Upon verbal notice of Seller’s acceptance of the Purchase Agreement, Buyer to deposit earnest funds in the amount of $1,000,000 in non-sequential bills in the offshore account of the Seller’s choosing. Should Buyer fail to deposit earnest funds within twenty four (24) hours of verbal acceptance, the rabbit dies.

Upon delivery of earnest funds, Buyer to be granted fifteen minutes to complete all desired physical inspections of the premises. Should Buyer require utilities to be turned on prior to inspection, Buyer may do so at his/her expense if he/she can properly name the tune of the Seller’s choosing in three notes. Should Buyer request any repairs be completed prior to Close of Escrow, Seller reserves the right to cancel this transaction, retain the earnest funds as damages and drop the Buyer off in the middle of the desert wearing a blindfold and bologna underwear.

*Buyer acknowledges that Seller won’t fix s&$% _________  (Buyer Initials)

In the event of a financed offer, Buyer to obtain full loan approval within ten seconds of execution of the Purchase Agreement. Close of Escrow to occur on a date convenient to Seller. Possibly next June. Maybe September. Seller to notify Buyer of the Close of Escrow Date on the day of closing. Should Buyer fail to perform, causing the closing to be delayed, Seller reserves the right to cancel this contract without further notice or grant an extension to the Buyer at a penalty of $100,000 per day. In the event that Buyer does not possess sufficient funds to meet these terms, Buyer may elect to name Seller in his/her Last Will and Testament and/or as sole beneficiary of the life insurance policy taken out in the amount owed.

*Buyer acknowledgement to “Watch your back, Jack.” ________  (Buyer Initials)

Upon successful Close of Escrow, Buyer agrees to be placed on the First Bank of Asbestos mailing list to learn about exciting new products and promotions before anyone else. Removal from our “Happy Homeowner Database” or enforcement of the provisions set forth in the National Do Not Call List Registry will result in Buyer missing out on special deals and helpful new homeowner tips, but participation is completely voluntary. Buyer is free to waive monthly subscription to “Understanding the Home We Told You We Know Nothing About” newsletter at any time.

*Buyer acknowledges that we still have the bunny.   _________  (Buyer Initials)

We thank you for selecting a First Bank of Asbestos home and look forward to denying your refinance application in the future on the grounds that there may or may not be a leaky underground missile silo on the premises that we don’t know s&$% about.



____________________________________________________
Buyer                                                                    Date



____________________________________________________
First Bank of Asbestos Representative                         Date

January 11th, 2011 … do you know where your tank tops are?

It’s time to talk Scottsdale vacation homes, people.

You see, while you are buried under two feet of snow, I’m mowing my lawn. In flip flops. As today is a bit nippy by Scottsdale standards, I went a little crazy and skipped the zinc oxide on my nose.

Now, I wouldn’t dream of poking fun at you poor buggers who are currently caught within exhale radius of Mr. Snow Miser’s arctic morning breath. Nope, I have no intentions of gloating or doing the verbal Ickey Shuffle all over that frozen tundra you call home. I’m certainly not going to ask you to hand deliver a message to one of the polar bears in the Coke commercials or wonder aloud about your local animal ordinances, and whether or not they allow for emperor penguin adoption.

Summer will roll around soon enough, and the mercury-bending shoe will be on the other foot.

In the meantime, however, I thought I might offer a few examples of that which a Scottsdale winter does not consist. You know, to help spread some vicarious warmth to those unfortunate souls trapped in the ice tray of nature’s Frigidaire. I’m all about paying it forward this year.

Things I Am Not Doing Right Now:

• Shoveling My Driveway
• Scraping Ice From My Frozen Windshield
• Winterizing My Cactus
• Spreading Salt Anywhere Other Than the Rim of My Margarita Glass
• Ordering Heating Oil – Might Restock On Banana Boat Deep Tanning Oil, However
• Dressing Like the Michelin Man On His Way to a Potato Sack Race
• Turning the Ignition Over In My Car In Case I Might Use It in April
• Getting My Tongue Stuck To a Pole
• Dodging Porch Stalactites
• Commanding Any of My Pets to “Mush”
• Battling Seasonal Affective Disorder
• Wearing a Thermal Speedo
• Driving a Zamboni to Work
• Opening Another Window On My Summer Solstice Advent Calendar
• Eating Comfort Food By the Cubic Ton
• Chewing Seal Blubber
• Climbing Inside the Belly of a Dead Tauntaun to Ward Off Hypothermia
• Cursing the Inebriated Snow Plow Driver
• Empathizing With the Donner Party
• Pretending to Puff Smoke With Each Visible Breath
• Hibernating
• Seeing Russia From My House
• Ice Skating On My Swimming Pool
• Remodeling My Mid-Century Modern Igloo
• Being Rescued From My Mailbox By a Whiskey-Laden Saint Bernard
• Employing a Sherpa For My Trek to the Grocery Store
• Joining a Polar Bear Club
• Getting Ready For My Neighborhood Yeti Watch Shift

Fun as all that sounds, I’ve got a full afternoon of driving around in my convertible after squeezing in a quick round of golf. Depending on my motivation, I might go lay out on top of Camelback Mountain for a spell. This epidermis ain’t gonna tan itself, you know.

Want to secure your own life of leisure? We can always accommodate one more Scottsdale vacation home owner. Contact us today, or jump to our Scottsdale home search page to find your own little slice of Southwestern paradise.

*Mukluks not required.

Maricopa County property tax valuation notices go out in another month or so, and the reverberation of a couple million jaws dropping will once again shake the Valley of the Sun. Whether a new homeowner’s first tax valuation experience or a case of seasonal amnesia in longer-tenured residents, many succumb to reverse sticker shock upon first glance at the meager value the county has assigned to his/her Scottsdale home.

“My house is worth WHAT?!!!“

Rest assured, values have declined in the greater Scottsdale and Phoenix area, but the paltry figure on the wadded up piece of paper in the clenched fist of an aghast homeowner seldom represents an accurate indication of current market value. I repeat, the county’s assessed value does not represent the home’s current value.

Our property valuation schedules are a convoluted mess here in Scottsdale. Rather than a simple statement of what your property is worth and the taxes associated with it, your notice will reflect myriad seemingly incongruous figures. Limited values, full values, cash values, secondary values … and a partridge in a pear tree.  To simplify (somewhat), let’s just break the tax notice down to what really matters to you.

The Assessed Value of a home is derived by the following formula:

Full Cash Value x Assessed Value Ratio = Assessed Value

The Full Cash Value figure is the closest thing to a current market value determination by the county, and it represents the value of the land plus (supposedly) any and all improvements (structures) to the property. Bear in mind, however, that this figure is arrived at exclusively through public record search. No appraiser comes to your house to value recent improvements, verify square footage, etc. Unless permitted, that computerized formula for value assignment is unlikely to take into consideration your recent kitchen remodel, new hardwood flooring, plantation shutters, A/C, etc. I have encountered far too many discrepancies between the information found in the tax records and reality to take even the assessor’s rudimentary information with anything less than a periodic table-shattering grain of salt. Non-accounted for additions, wildly inaccurate square footages and omission of swimming pools are public record bugaboos that immediately come to mind as repeat offenders.

Once Full Cash Value is assigned, dubious as it may be, that figure is multiplied by the Assessed Value Ratio to arrive at the Assessed Value (the number that causes fainting spells across the Valley). For residential properties (with completed homes), the Assessed Value Ratio is 10%. For vacant parcels, it is 16%.

Once Assessed Value is determined through that formula, it is in turn multiplied by the current tax rate to determine the total taxes owed for the upcoming cycle. To further complicate matters, there is a primary and a secondary tax rate to consider, but we’ll save that stimulating bit of minutia for another day.

Maricopa County Property Tax FAQ

Confused yet? So is nearly every homeowner and buyer in Scottsdale. Let’s apply it to a real world scenario.

Take a residential property assigned a Full Cash Value of $300,000. For the sake of clarity, we’ll combine the primary and secondary tax rates at a not completely arbitrary 6.5% (roughly the combined rate for my tax district in 2010). Using the formula outlined above:

300000 x .10 = 30,000 x .065 = 1950

With total tax liability established at $1950, it is divided into semi-annual bills of $975. First half taxes are due on October 1st (delinquent on November 1), and second half taxes are due March 1st (delinquent on May 1) of the following year.

Mathematical gyrations aside, as that was not the original intent of this piece, my advice to homeowners and prospective homeowners alike is not to look to the tax rolls in pursuit of an authoritative decree of a property’s current worth. Even if you know which figures to look at, the full cash value determination is not the ultimate purpose of the assessment, and therefore renders its application to any one specific property an unreliable measure.

A system designed for county-wide revenue collection is not a great gauge of what Mr. and Mrs. Smith would be willing to pay for Mr. Jones’s house on 1/3/10.

If a specific property’s value is one needle in the market’s haystack, the assessor is using a forklift to find it.

Or, to satisfy my personal quota for no fewer than 2 gratuitous metaphors per post, the county assessor is stalking the nimble prey of current market value in a bazooka-wielding dump truck.

The tax rolls are full of good stuff that can be exploited in negotiation. Total lien encumbrances, dates and price of purchases, taxable square footage, zoning, parcel size, etc can all be utilized by a savvy consumer to secure the tactical advantage that accompanies such intelligence gathering. Just don’t look to this cumbersome evaluation method to derive your unshakable opinion of the property’s worth.

Recent comps, current competition, pending sales … this is how you triangulate current market value. Property tax assessments, online evaluation algorithms, Carnac impersonations … amusing broad stroke guesstimations, but nothing more than jumping off points.

Want to determine what a home is worth? Get an appraisal or contact a local Scottsdale Real Estate agent for an opinion of value via comparable market analysis.

Want to give yourself a stroke? Base your price expectations around the assessed value notice that hits your mailbox in February.

You have Scottsdale Real Estate questions.

We have answers.

Q: Is now a good time to buy a house in Scottsdale?

A: Forgive me for answering a question with a question. Do you need a house? The best time to buy a house is when you need one. Conditions are advantageous for buyers who can scrape up the requisite down payments and qualify for financing due to low interest rates and home values, but such external factors are irrelevant if you are not in the market for a new home. It’s probably a great time to buy a car right now, too, but are you going to rush right out and get one if your current vehicle serves your present needs? We agent types like to drum up business by urging consumers to act before a window of opportunity closes forever, but don’t let outside forces push you into a purchase based on fear or avarice. Likewise, don’t let extraneous market “noise” prohibit you from making the right purchase for your current needs. Obsessive market watching tends to lead to the dreaded “analysis paralysis,” which shackles a would-be buyer to indecisiveness. We all want to buy when the market is most conducive to securing a bargain, but such considerations must be in concert with, not mutually exclusive of, present need. Good and bad purchases are made every day.

Q: How much off the listing price should I offer?

A: Seeing that every sale involves a different seller, it’s a losing proposition to think in terms of a standard percentage of offer price to list price. Not only is the financial position of every seller unique, there is little with more emotional attachment than a home. Carve off an unrealistic amount in an initial offering, and you risk alienating the seller. You torpedo the negotiation before it even begins. Even when you remove emotion from the equation, such as with bank-owned property or short sales, the offer should be based upon value, not an arbitrary formula. For instance, if a bank-owned property is 100k undervalued in the list price, you can forget about knocking 10% off an already solid bargain. Consider yourself lucky if multiple suitors don’t show up to bid it up well over asking price. On the other hand, if a home is overpriced by 100k, offering 90% of list price likely means you would be overpaying considerably. Each property and its owner are unique, as should be the consideration that goes into the crafting of your offer.

Q: What’s all the fuss I keep hearing about appraisals?

A: Appraisals, and financing in general, comprise the soft underbelly of our slow-motion Real Estate recovery. The challenges start with the professional who is tasked with performance of the appraisal. New regulations were enacted to prevent fraudulent evaluations from artificially inflating home values, but we’ve traded one set of problems for another. These days the appraiser is essentially picked from a hat to prevent conflicts of interest. Unfortunately, this means that out of area appraisers of varying degrees of competence are often charged with evaluating homes in neighborhoods they have never previously worked. Further, as a designated “declining market,” even the home that closed across the street just last month is subject to a markdown in value to allow for depreciation in that short period of time since it closed escrow. Until we can overcome this stigma, home values will continue to be adjusted downward from the recent sales comps. Factor in the multiple appraisals that are often required for FHA financing on “flipped home” purchases (homes that sold within 90-120 days of the current transaction), and loan underwriters with the authority to review and reject the appraiser’s findings, and you get the minefield we have today.

Q: Should I pay off my credit cards to qualify for a loan?

A: Don’t even break wind without consulting your lender first. While I would hope that it is obvious that major purchases are off limits during loan qualification/processing (can affect debt to income ratios, credit scores, cash reserves, etc), many a home purchase has been derailed by the misguided good samaritanism of the borrower. You may need the good credit associated with the line that you aim to shut down or deplete required cash reserves that are necessary to gain full loan approval. Never assume that paying something down or off is beneficial to your unique financial profile without first consulting your mortgage professional.

Q: Should I bother with an inspection and final walk-through on an “as is” transaction?

A: The nature of an “as is” sale is one of the most fundamentally misunderstood concepts in Real Estate. Assuming that the purchase is made utilizing the standard Arizona Association of Realtors “As Is” addendum and the boiler plate language is not contradicted anywhere in the contract, all you are really agreeing to is the dismissal of seller warranties as to the condition of the property. You maintain full inspection rights with the option to walk away from the sale if condition is unsatisfactory. There is nothing that precludes you from requesting repairs at that point as well, the seller is simply not contractually bound to make any. As to the walk-through, it is important that you verify the property is still in substantially the same condition at closing as it was when the contract was signed. “As is” reflects the condition of the property at the time of the agreement. Any subsequent damage to the property is the responsibility of the seller. If the A/C has stopped working, or a tree fell on the roof, you likely have a case to demand repair or walk away from the sale.

Q: What am I actually looking for in a title report?

A: In short, you want to make sure the seller’s Uncle Willy from Topeka, who hasn’t been seen or heard from in forty years, doesn’t pop up after closing to claim an ownership interest in the property. Tax liens, mechanic’s liens, encroachments, easements, back HOA dues … you are basically looking for anything that can preclude your full rights to ownership and use of the property. I always pay special attention to the “Schedule B” of the preliminary title report that is furnished during the escrow period by the title company as it lists those items that will be exceptions to the title insurance policy. Gremlins that might pop up after closing, and will be outside of the scope of your title insurance coverage, typically hide here. With the abundance of short sales, foreclosures, tax sales, etc in our midst, the transference of clean title to a buyer has never been more rife with potential sabotage. If you are purchasing a bank-owned property, or really any property with recent changes in ownership, you want to make sure all encumbrances on the property have been or will be resolved in advance of settlement. Short sale buyers will need to know that the seller’s lienholders have, in fact, agreed to release the lien(s) on the property at closing. While these are functions of the chosen title company, they are not matters that can be taken for granted in 2010. All of those documents supplied by the title company during the escrow process that nobody used to read? Read them. If you aren’t sure which items are cause for concern, ask your agent. If your agent doesn’t know (or instill confidence in you that he does), contact a Real Estate attorney to review and advise.

Prevailing wisdom may label this a “buyer’s market,” but there are things roaming around out there in the haze. Biting things. Make sure you know what you are doing before stumbling out of the house, armed only with a pre-qual letter.

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Ray and Paul Slaybaugh are NOT attorneys. None of the opinions herein should be construed as legal advice. Should you have specific legal questions regarding the purchase or sale of Real property, contact a Real Estate Attorney.

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Have Scottsdale Real Estate questions? Send them to us through the contact form below. We’ll do our best to answer all in a timely fashion, and will use our favorites for future posts.

Times were a buyer could reasonably anticipate that a seller would provide a one year home warranty policy with the sale of a home. Given the equity crunch that many are experiencing, and the prevalence of short sales and bank owned homes in the current market (which typically do not provide such policies), home warranties have gone the way of the buffalo as a throw-in to a Scottsdale home sale. With the lack of disclosures and repairs that accompany distressed property sales, however, such protection has never been more important. With that in mind, we are offering the following October promotions in addition to our always competitive rates.

For Buyers:

Free Home Warranty Policy - Register to utilize Paul Slaybaugh’s services as your buyer’s agent prior to 10/31/10 and receive a complimentary one year home warranty policy with your purchase at the close of escrow. See below for additional terms and limitations.

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For Sellers:

Free Home Warranty Policy For Your Buyer – Want to stand out from the competition by offering a home warranty policy to potential buyers? I understand the equity pinch may not make such overtures possible. Let me do it on your behalf. Register to list your home for sale with Paul Slaybaugh prior to 10/31/10, and I will provide your buyer with a complimentary one year home warranty policy at the close of escrow. See below for additional terms and limitations.

…………………………………………………………………………………………………………………………..

Additional Terms:   Promotion valid with website registrations prior to October 31, 2010 only. Close of escrow must occur prior to 10/1/11 for offer to remain valid. Promotion is offered exclusively and may not be combined with any other offer. Maximum value of $325 per policy. Not responsible for cost of additional coverage over and above $325. Not redeemable for cash value. Utilize registration form below to qualify.

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