Short sales are becoming an increasingly larger portion of the landscape here in the Scottsdale and Paradise Valley areas, with short sale closings accounting for 21% of all closings in April of 2010, up from 9% in April of last year. There were 34 successful short sales closed this April with sales prices from $600,000-1.65m. There is a noticeable trend that more luxury homes and real estate are entering the distressed market.
The Scottsdale and Phoenix Luxury home market has been affected by rising interest rates on jumbo loans, limited loan availability, and increasingly strict requirements in qualifying for loans. According to the National Association of Realtors, inventory on homes priced above $750,000 has risen from 18 months supply in 2007 to a 40-month supply in 2009. NAR also reported that the foreclosure rate on jumbo loans was nearly double the rate on conforming loans ($417,000 and below).
The sluggish global economy, shortage of opportunities to refinance, the growing inventory of luxury homes, and fewer qualified buyers has created a massive complication for luxury homeowners who need to sell….. but can’t.
Who do these luxury homeowners facing these situations turn to?
There are government programs to help homeowners in distress including the HAMP for mortgage modifications, and HAFA for short sales. Property Owners with higher loan debt may not qualify for these programs, but most servicers are willing to follow similar step to lessen losses. Traditionally a short sale will cost a bank an average of $40,000 to foreclose rather than short sale, which includes attorney fees, depreciation, and carrying costs. This FREE help is available to residents of Scottsdale, Phoenix, and Carefree areas facing foreclosure.
It is critical for homeowners to understand their options, and should contact a professional who is educated with the foreclosure process, as well as government programs, anti-deficiency laws, and short sales. I have created a website with free information for consumers on alternatives to foreclosure, and am always here to answer any questions or concerns.
To view more information discussed in this article you should visit FREE Arizona Foreclosure Information