There is just too much talk in the media about home price declines for the first time in a long time. The Foothills market has stabilized; a price decline of less than 1 per cent just is not very notable. Of course, the prices in Tucson have not gone down in years. This is because prices never went up as much as they did in Spring 2004 – Spring 2006. What goes up so much, so fast, can not last. Interest rates are at a 3 month low of 6.5% for conforming, 30 year fixed financing and jumbo financing is finally at a desirable 7%. Inventory is good, but certainly not flooded. It is a very good time to buy and not a bad time to sell either. We are not like most of Arizona! The Foothills has pretty much held its value, or gone down a little bit. Those of us that bought 3 or more years ago can make quite a nice profit if we sell, and Buyers have a nice choice of desirable homes, unlike the past few years.
Archive for August, 2007
Great news! Conforming loan interest rates are now 6.5% and jumbo loan interest rates are 7%. These are for fixed rate 30 year financing. (Conforming loans are under 417K and Jumbo loans are over 417K). Additionally if you buy a Long listing and utilize a Long Mortgage lender, the first year will be brought down 1%; so for loans under 417K, it would be 5.5% the first year and for higher loans would be 6% the first year! I am so happy I work for Long since it offers such innovative programs that serve its clients so well. Keep in mind this mortgage buydown is only offered through September 15th. What a great time to buy a Long listed house! These low interest rates are pretty much the same rates we saw a year ago. What a difference a week makes!
Jumbo mortgages cost a little over 1 percentage over conforming financing as a result of the credit tightening going on in the lending industry. A year ago a buyer who wanted a jumbo mortgage (financing over 417K) would pay about 1/4% over the conforming loan amount (loans under 417K). During the next few weeks, if you purchase a Long listing, Long Mortgage will discount the first years’ interest rate by 1%. So don’t wait to buy; call me if you are interested in viewing homes for sale.
In the Foothills area, there are a fair amount of buyers who finance through jumbo loans since house prices are higher than the rest of Tucson. This increased percentage rate for Jumbo Mortgages – this weekend was just a little less than 8%– will likely have a little negative impact on the sale of houses that are list priced over $500,000. It may take longer to sell and it is likely to cause more concessions by the Sellers. On the other hand, for those buyers who are looking to originate mortgages of less than 417K (conforming loans), there is good news: rates have dropped. This weekend you can procure a fixed rate mortgage for 6.625%. And as mentioned above, for a very limited time only if you buy a Long listing and use a Long Mortgage Lender, the first year will be 1 percent less or 5.625% (this weekend rate– Keep in mind rates change daily.) Long Realty is working hard to keep our inventory moving and keep our clients happy.
Tucson Multiple Listing Service has published its July stats. The number of sales YTD in North Tucson is down about 25% from last year at this time. The number of new listings is about 3.5% less than this time last year.
I always keep up with the market and am constantly previewing new listings and am amazed that in this market (with so many homes for buyers to chose from), that houses are not staged better. Many have too much furniture which makes the house look small or have too many personal pictures everywhere. When there are too many personal pictures, it is hard for a buyer to imagine themselves living in the house. More than a few are priced too high. I always wonder if their agent is not giving them good advice or if they stubbornly do not listen to the advice their agents give them.
It is apparent that the market is not real poor for Sellers, but they really have to make the effort to make their houses, inside and out look as good as possible to stand out from the crowd.
The subprime market debackle has little or no affect on the Foothills market. Most buyers in the Foothills have good credit scores and put a minimum of 10% down. So although you will hear a lot of negativity about the huge affect this situation has on the marketplace, we are lucky enough not to be very affected.