The WeBuyTucsonHomes Blog

The past week saw little change in the number of foreclosures for the first week of December.  The past month large banks, Freddie and Fannie Mae released press statements announcing a hold on foreclosures until the end of January and sometimes later.  Here in Pima County the number of defaults filed hasn’t changed substantially, but it could be they are postponing all foreclosures that are already slated between now and the end of January.

To the chart!

195 notice of defaults were filed Dec. 1-7th.  The leading zip code was 85742 which happens to be because a luxury builder has struggled to make payments, and sell property.  If you are looking for some great luxury deals this might be for you.  If you would like to know the address or the builder just shoot me an email at caleb@webuytucsonhomes.com.  The properties in 85742 range low end $121,000 to $2,000,000.

The next zip code was 85746, and 85706 with 16 and 14 defaults respectively.  85746 has remained high on the notice of default list and I expect this will continue with the high number of homes for sale along with the bank sales in that zip code.  I have talked with many sellers in that area and it is still very tough to negotiate with the banks to have them accept a substantial short sale.  I remain pessimistic on the neighborhoods in the new communities and think it will take many years for them to recover.

If you wish to discuss anything from the graphs please post a comment or shoot me an email.

18 NODs in Pima County

The week of Nov 24-28 saw a low number of N.O.D.s filed in Pima county, but because a large “retirement home” missed a few payments, the total dollar amount of first mortgages ran over $74 million dollars.  The retirement home contributed over $45 million dollars in mortgages to the total, because of that the $45 million will be taken out in the calculations below.

The number of filings were down presumably to the short holiday week, but a surprising number of “luxury ($500,000 and up)” homes fell into default.  Usually one or two homes will fall into default every couple of weeks; the past week saw 8 home.  Following what many financial analysts have been lamenting, a couple of commercial buildings were found to be on the list.  The amounts were relatively small at only a few million dollars, but if the trend continues we could see discounts coming in commercial buildings and more cheap office space for rent.

A total of $29.1 million dollars were in default, not including the $45 million from the retirement home, with a Zillow value of $26 million dollars.  This was the first time in running this list that the values were more than the first mortgage.  This could have devastating effects on the banks holding the notes.  Usually in a short sale the banks will discount or remove the second mortgage to help facilitate the home sale.  However, if the home is now worth less than the first mortgage, banks may be even less inclined to negotiate and favor to take the home back(foreclose) rather than take a chance on a definitive short sale loss.  It will be interesting to see if this trend continues.

Further, this week I noticed more properties held 2nd mortgages in excess of 15% of the first mortgage.  The 15% standard 2nd mortgage will not be increased, but is of interest as the amount of 2nd mortgages could be much higher.  Also 85746 outpaced 85706 14 to 13 in NOD filings marking the first tim85706 has not lead the way in homes in default.

So here is the chart.(Upgraded to Office 2007 so the charts are “prettier”  :))

116 Notice of Defaults for Pima county

Sorry for being a little late, the holiday season seems to always come with a bang.

Pima county recieved 202 notices of default during the week of Nov 17-21.  This number has been steady with a variance of 10% give.  This number hasn’t been changing much even with all the press releases of banks suspending foreclosures, and many businesses popping up to help with the loan modifications.  It makes one wonder how successful the banks are in negotiating a loan restructuring.

To the numbers!  201 NOD’s were filed with a first lien position of roughly $39.5 million dollars in loans going bad.  Add a 15% average 2nd position($5.925 million) and the total balloons to $45.5 million dollars in bad loans.  According to Zillow,  the property totals are worth ~$41.3 million dollars.  A difference, if the houses were to sellat Zillow estimates, of $4.2 million dollars.  Not a large sum but if that figure added up over a year it would look at $200 million dollar shortfall for the banks.

201 NOD filed in Pima County Nov 17-21

The Tucson La Paloma Resort & Spa and Westin Hilton Head Island Resort & Spa in South Carolina, financed via a $209 million loan from JPMorgan & Chase, is near default according to Standard & Poor’s. The loans were based on rising revenue. The harsh economic times have reduced revenues and rising cancellations have pushed the two resorts on the brink of default.

La Paloma could be on the brink of default

BAD NEWS FIRST

30 Reasons for the Next Great Depression

Homebuilders Index is at an all time low.
Guess that is what happens when you overbuild, ask the telephone companies from the dot come bubble.

GOOD NEWS
HUD relaxes requirements for Hope for HomeOwners

Mortgage rates are going down

Freddie Mac and Fannie Mae suspend all foreclosures until after the holidays!

San Diego home sellers have trouble recognizing their homes are now worth 20% less than before.

Home prices have dropped so much, no one really knows what price homes will sell. A lack of credit worthy buyers and lack of lending in the nation, means a longer time on market. The longer the house is on the market, the more likely the Realtor will push for a price reduction. Most Realtors rely heavily upon this proven selling convention of lowering prices to sell homes quickly. The tactic works because everyone loves a bargain, but it comes at the sellers expense. There are ways to sell a home without lowering the price, but it means having a Realtor that is willing to work for a higher price. In this market that takes a lot of work to compete with bank foreclosures.

Great Information on how to work with your credit score.

Interesting on how many factors go into your credit score.

Changes coming to Good Faith Estimates

This form looks much better and will help many new home buyers.

1 in 3 homes sold for a loss last year.

Look at the chart! Countrywide’s REO inventory is still growing.

Arizona has some 1770 homes owned by Countrywide alone. Tucson has around 80 homes owned by Countrywide.

It looks like home prices have a long way to fall yet.

Have a great week!

Caleb

Nov 10-14 Pima County recorded 127 Notice of Sale documents against homeowners this past week. First mortgage loans totaled roughly $23.5 million vs $25.5 million in value(Zillow Estimates). Applying the same 20% average second mortgage against every home gives a total of $27.7 million owed vs $25.5 million in value. This means the average foreclosure home is 8% “underwater” this past week, better than last weeks average of 20% underwater.

Once again 85706 led the rankings with 12 filings, 85746 was second with 11, and 85629 was third with 9.

Via nytimes.com The New York Times ran an article with an interactive map displaying the United States and what percentage of the homes are worth less than the mortgages on them.  Arizona currently stands with 29% of homes  worth less than the mortgages on them.   Roughly 375,469 homes have negative equity, and most homes have an average debt to value ration of 76%.

Later today the Fed is set to present a loan modification program for Fannie and Freddie!

The banks are starting to see that adjusting rates, reducing the principle balance, and extending the term of the loan; maybe favorable opposed to foreclosing on the home, holding the house for a year and then trying to resell.

Caleb

The Arizona Daily Star ran an article reporting the increased foreclosure sales figures for Pinal county.  According to the article 45% of the existing home sales in Pinal county were foreclosure driven.   That means of the 3,355 home sale transactions 1,515 were from foreclosure.  I can’t find any mention of Pima county but will be on the lookout.

This past week Pima County listed 185 Notice of Sales filed for the week of November 2-7. The first mortgage on the properties totaled roughly 34.4 million vs property values according to Zillow of 34.7 million.  Now remember this is only the first mortgage position and all most all of the properties list 2nd and sometimes 3rd positions. The second position can vary anywhere from 5% all the way up to 40%. Take a low end average 20% and the liens against the properties increase to over 41.2 million. This puts almost all the properties 19% “underwater.” Now factor in that Zillow maybe overestimating housing prices and some home owners could be even further underwater!

Looking at the chart we see 85706 again led the way with 24 notices filed. 85746 was second with 19 and 85711 was third with 14. Some interesting things to note were a few large real estate investing companies, both national and local are seeing notices filed against properties they own. Why do I mention this? They were speculators in some instances, as the filings were on very new and high priced homes, and also to show that the financing crunch paired with the downturn in housing is hitting everyone hard.

Here is the chart with 185 Notice of Sales for November 2-7, 2008

This past week 200 foreclosures were filed in Pima County totaling over 36.7 million dollars in first mortgages. 85706 continued to lead the county in Notice of Sale filings, with 27 filings and 3.6 million dollars in first mortgages. 85717 had the second highest filings with 17 and 2.7 million dollars in first mortgages. Here is the graph.