If my month of June is any representation of what’s going on in the Flagstaff market, and who knows if it is, home sales will happen if your agent works hard enough and if you, as the seller or buyer, are motivated enough.

On the buyer’s side, you need to have persistence is working with your lender (assuming you are not one of those rare cash buyers – we had one this month). The loan process is really tough and you can’t treat it casually. Even when you’ve done all the work required of you, it may not work if the appraiser and the several layers of underwriting don’t like the deal you’ve negotiated. Your mortgage loan originator should have options available to you if the first try at a loan source doesn’t work. Most of my transactions this month were done with FHA-guaranteed loans – even those at higher prices and with substantial down payments.

On the seller’s side, it won’t work if you don’t price it right and clean it up. Using a professional stager helps. Once you get an offer, take a deep breath and don’t count on it closing on time – see the last paragraph. When it does, it is because the people working on your behalf, and for the buyer, pulled off a miracle.

So, if any one tells you Flagstaff homes are not selling, tell them they are wrong. So far, the report for June shows 95 homes sold.

Here are the seven I was involved with:

1407 S. Union Pacific – foreclosure sale was a great deal for our buyer but the title issues were a challenge

11110 N. Lupine Lane – Listing - was under contract before the ink was dry but “Oh My!” what lending issues we had, and then it was done!

9130 W. Arden Lane – represented the buyer – like all purchases nowadays diligence on the lending process got it done!

11160  Rodeo Road – Listing -- under contract in a week and closed in 26 days!

3939 N. Paradise Road – Listing – some twists and turns then we got it done three appraisals later!

8215 Autumn Drive – Listing – sold with creative, last-minute financing switch!

2640 E. Matterhorn – Listing – sold at 100%

To buy or sell a home in Flagstaff, start by contacting Team Heitland at RE/MAX Peak Properties!

Many homeowners who don’t need to sell in this market are choosing to sit it out. Fearful that their homes will sell for less than they would have three years ago, many homeowners are missing the opportunity presented by the current real estate market. It’s only natural that a homeowner will focus on the loss in home prices compared with recent years, but “move-up” buyers need to focus on the importance of buying now in order to have a long-term positive impact on their net worth.

The smaller loss at sale will be compensated by greater savings at purchase, resulting in a significant net gain. The example here assumes a 10% drop in the home market at both levels. In fact, in Flagstaff, the advantage may be even greater because the prices of lower-priced homes seem to be beginning to hold while the higher priced homes continue to go down.

An early read on the June Flagstaff homes market shows that the number of sales is likely to be about the same as in May, but the median price, so far, is over $35,000 higher than in May. The median price tells us what price ranges are selling, and so it appears that the volume of sales higher-priced homes in Flagstaff may be improving. Thus, it may be that some homeowners are taking advantage of this market to “step-up” their housing. Certainly, some of my clients are.

When you buy a larger and better home under the current market conditions, you are saving more on the purchase than you lost on the sale of your previous home, and your new home is of often better positioned for appreciation when the market rebounds. If you take the example above, and assume that the homes appreciate 10% in value, the first home gains $27,000, while the second gains $45,000. Over my lifetime, I’ve traded up several times – including in a market when interest rates where 12% and above. Each time, I was able to add to my net worth with appreciation on the larger and better home.

Let me assist you in deciding if now is the time for you to sell your Flagstaff home and trade up to take advantage of this buyer’s market in Flagstaff. Contact Team Heitland at RE/MAX Peak Properties: 928-714-0001.

Sales of existing homes showed another gain in May according statistics released this week by the National Association of Realtors.^® May’s increase was the first back-to-back monthly gain since September 2005. This is a national number and Flagstaff, so far, is lagging the national recovery. For Flagstaff home sales statistics for May, read my monthly report by clicking here.

Nationally, existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 2.4 percent to a seasonally adjusted annual rate of 4.77 million units in May from a downwardly revised level of 4.66 million units in April. Sales remained 3.6 percent below the 4.95 million-unit pace in May 2008.

Lawrence Yun, NAR chief economist, explained the improvement in sales: “Historically low mortgage interest rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates,” Yun says. “First-time buyers also are being drawn off the sidelines by the $8,000 tax credit, which is helping to absorb inventory.

However, the increase in sales is less than anticipated based upon the Realtors^® Pending-Home-Sales Index because transactions are stalling in escrow. Yun blamed “faulty” appraisals for preventing buyers from getting loans. In Flagstaff, we have certainly had lengthy, and sometimes failed, transactions because of the difficulties of appraising property when there are so few sales for appraisers to compare contracts to. Underwriters and mortgage insurers are taking a very cautious approach to lending, even when an appraisal matches the purchase price. Several successful Flagstaff transactions have had to switch from conventional lending to government-guaranteed FHA loans because of the cautious private lenders.

An NAR practitioner survey in May showed first-time buyers accounted for 29 percent of transactions, and that the number of buyers looking at homes is nearly 10 percentage points higher than a year ago. First-time homebuyers have been spurred by the up to $8000 tax credit available to them this year for homes that close prior to December 1. This, in turn, is beginning to spur repeat buyers as they are able to sell their homes and step-up. Yun said, however, that “investors appear less active, but are more prevalent in areas with large price corrections.”

National median existing-home price: for all housing types was $173,000 in May, down 16.8 percent from a year earlier. The market share for distressed properties declined to 33 percent of all sales in May from 45 percent in April.  Single-family home sales: rose 1.9 percent to a seasonally adjusted annual rate of 4.25 million in May from a pace of 4.17 million in April, but are 3 percent below the 4.38 million-unit level in May 2008. The median existing single-family home price was $172,900 in May, down 16.1 percent from a year ago. Existing condominium and co-op sales: increased 6.1 percent to a seasonally adjusted annual rate of 520,000 units in May from 490,000 in April, but are 8.9 percent below the 571,000-unit level in May 2008. The median existing condo price was $173,800 in May, down 21.9 percent from a year earlier.

Regionally, here’s how housing fared across the country for existing-home sales:

• Northeast: rose 3.9 percent to an annual level of 800,000 in May, but are 10.1 percent below a year ago. Median price: $243,600, which is 12.5 percent below May 2008.

• Midwest: jumped 9 percent in May to a pace of 1.09 million but are 4.4 percent below May 2008. Median price: $145,800, which is 10.4 percent lower than a year ago.

• South: unchanged at an annual pace of 1.74 million in May but are 8.9 percent below a year ago. Median price: $157,400, down 9.9 percent from May 2008.

• West: slipped 0.9 percent to an annual rate of 1.14 million in May, but are 11.8 percent higher than May 2008. Median price: $197,700, down 30.6 percent from a year ago.

4184 Broken Rock Loop

This home is in turnkey condition with features you will love.

Let's start with the lot: Large, corner, Ponderosa Pines, excellent landscaping with sprinkler system.

Inside, you'll find a cozy wood-burning fireplace, outstanding flooring and much more that reflects pride of ownership. Don't miss the superior door to the deck, which adds light and energy-efficiency. The combined kitchen and family room extend nearly the entire length of the home, providing great space to relax and entertain. Laundry room includes a utility sink and cabinets.

You'll appreciate the comfort of central air and the energy-savings of a furnace installed in the last 3 years. Garage includes a tool bench and amazing built-in storage closets.

Continental Country Club amenities: Clubhouse, Jotini's Restaurant, 2 Swimming Pools, Kids Recreation Center, Tennis Courts, Golf, Miniature Golf, Work Out Facilities.

Oh, and there is a basketball court in the backyard!

As I was studying the MLS hot sheet for Flagstaff home listing changes since last Friday, I noticed quite a few sales. The price per square foot of the sold homes varied widely – from $121 per square foot to over $240 per square foot. Of course, the homes varied widely, too: From stripped and unlivable to a pristine Flagstaff Country Club townhome. There was another luxury property on a one-acre lot in the same region of Flagstaff in the same higher price per square foot range.

What’s the lesson in this for buyers who may be hesitating about buying a Flagstaff home? Very little. One cannot tell from such a snapshot of the market what is going on in the Flagstaff real estate market except this: You will not find a home for $50 per square foot – and it’s highly unlikely that we’ll see one for $100. Also, you can tell that Flagstaff homes are selling. Some buyers think the time to buy is now. After all, the prices per square foot are down from a year ago, when they were down from the year before, and folks need a place to live!

Will Flagstaff home prices go lower? Perhaps. But signs are that Flagstaff home prices are leveling out. At most we will not see the kind of drop we saw in the last year. Meanwhile, interest rates are going up. If your goal is to buy a home, this is a great time to do it and here’s why: A 10% home price drop is immediately nullified by a 1 percentage point increase in prices.

Note: assumes a 90/10 loan-value.

Even at 6.5%, rates will be considered low and favorable to the housing market. I’ve lived through (and bought homes) when interest rates were over 12%. The question is not, do you want a home, or do you want a “deal.” The question is do you know what the deal is? Timing the market is a bad idea whether it’s stocks, bonds, or homes.

If the market you want to be in is one that will give you a home in Flagstaff, start here: Team Heitland at RE/MAX Peak Properties. Or, give us a call: 928-714-0001.

What's happening with foreclosures in Flagstaff? That's a very good question.... one that I've been searching to answer in an intelligent way for a couple of weeks now. For several months, I posted the Coconino County foreclosure lists on my other blog on Active Rain. I stopped the postings because I thought the statistics were telling the same story every week -- and because I ran out of time in this busy season of buying and selling Flagstaff real estate.

Here are the straight facts that the foreclosure sales lists were telling: Every Monday, many (20-50) foreclosure sales were scheduled on the courthouse steps in Flagstaff. Many of these were for outlying county properties, but several also were in Flagstaff itself. Reviewing the lists of actual sales at the end of each week, however, showed that few of the sales actually occurred. Homeowners were somehow rescuing their homes from the foreclosure block just as the gavel was about to fall. The serious story is how and why was this happening?

I still don’t know the whole answer. Some of it is surely that the homeowners turn over a deed-in-lieu of foreclosure at the last moment. A few of the cancelled trustee sales are due to last minute closings on successful short-sales. In one case I know of the sale was not even short – it was just desperate. Some last minute cancellations are a result of bankruptcy judges issuing temporary orders of stay. Others are last minute workouts and rescues due to some of the government plans that have been put in place. Some are loans provided by family members or once-in-a-lifetime windfalls – although there are probably very few of these.

What I do know is that there are, right now, very few bank-owned properties for sale in Flagstaff. That’s because we haven’t seen many actual foreclosures in the last few months. But I’m not certain this will continue. Partly because the official moratorium that was in place during the winter for government-guaranteed loans and for some big banks stopped about three months ago and that's about the time it takes for a bank to get a home ready for market after it takes title. Also because I hear other stories – stories of homeowners who stopped paying their home loans months ago and their banks have not foreclosed. Why is this? I speculate that it is because the banks don’t want to own the property.

And there is a deeper story there as well. We’ve heard throughout this foreclosure mess that banks don’t want to foreclose because it costs them an average of $50,000 to process the foreclosure – attorney fees, trustee fees, Realtor^® fees, cleanup and utility expenses. But there is more at work when homeowners never hear from the bank. Or the bank takes the foreclosure process to the brink and doesn’t force the gavel down. Here’s what it is: the banks don’t want to own the property because of their balance sheets.

The scary part of all of this is that even though nationally we’ve had over one-million foreclosures this year alone, it’s likely that there are many more to come. And, that means that home prices may have hit bottom – because the inventory from now on may trickle out – but the prices are not going up for a long-while, for the same reason.

Steer clear of the many activities in downtown Flagstaff this Saturday and head for some Flagstaff open houses in the Southeast quadrant of town -- Flagstaff's classy and classic Continental Country Club neighborhood.

See the schedule below:

                        10-11              4621 E Timber Point Way    $469,900

                        11-12              4511 E Burning Tree Ln        $545,000

                        12-1                2899 N Rio De Flag Dr         $619,000

                        1-2                  2148 N Cypress Point         $375,000

                        2-3                  2155 N Fox Hill Rd              $498,500

                        3-4                  5804 E Ridge Rd                 $400,000

Your Realtor^® host for Saturday's tour is Xavier Wynns of RE/MAX Peak Properties.

If this schedule does not work for you, and you are a qualified home buyer, contact Team Heitland at RE/MAX Peak Properties to arrange your private showing of any of these, or any other, Flagstaff homes.

Real estate prices in Flagstaff have lagged other markets in the home price downtrend. This year, Flagstaff homes are catching up with the nationwide downward real estate spiral. In May 2009, the median price of a single-family home sold in Flagstaff was 19% lower than for Flagstaff homes sold a year ago. SFR prices for the Flagstaff metro area for May 2009 were down 25.9% from the peak for the month of May that was reached in 2007, when the median price of a home sold in the Flagstaff area was $399,750. Last month, the median price broke $300,000 going in the other direction – it was $296,000.

The glimmer of good news is that volume of sales improved substantially in May compared to earlier in the year, as we usually expect this time of year. Sixty-nine single family homes sold in the Flagstaff area in May; however over three hundred more homes were for sale at the beginning of June than at the beginning of May. This leaves Flagstaff with more than 14-months’ supply of homes actively for sale – a strong home buyers’ market.

Remember, this report is the overall Flagstaff homes market. Trying to buy a home in the median price range is a different story. Homes priced right, in decent condition, and in the lower price ranges are flying off the market quickly. However, in the $400,000-and-above range, there is a great deal of competition and still very few buyers.

Townhome sales improved slightly in May, with six Flagstaff townhomes selling during the month. The median sales price was $244,750 – down 7.6% from May 2008. There were 96 townhomes for sale in Flagstaff at the beginning of June, so the Flagstaff townhome market is still obviously overloaded and prices are likely to continue to come down in this category. Townhome sales in Flagstaff have suffered because the demand for second homes is down and because single-family-residence prices have fallen into a range to compete with townhomes.

Remember: all real estate is local and a market analysis for your neighborhood and price range must be done specifically for your home, or your future home, before you make a decision about buying or selling. Before making this important financial and personal decision, get a Realtor^® who knows the market well and will perform the analytic work specifically for your home.

Statistics used in this report are gathered from the Northern Arizona Multiple-Listing Service owned by the Northern Arizona Association of Realtors.^® The information is deemed reliable, but is not guaranteed since it is based on reports from a variety of brokers and agents within the association. The home sales reported do not include all sales in the area. The slice of the Northern Arizona MLS data used here is based on homes with Flagstaff mailing addresses – whether within the City of Flagstaff or outside the city and in the immediately surrounding Coconino County areas.

If you’re ready to buy or sell, contact Team Heitland at RE/MAX Peak Properties!

This Saturday, the open house tour will be in the Ponderosa Trails area of Flagstaff.

Each home will be open for one hour:

10-11 am             1500 W Lil Ben                     $429,000

11-noon              1108 W Lil Ben                     $459,000

12-1 pm              3760 S Hideout                    $370,000

1-2 pm              508 W Nugget Trail                  $465,000

2-3 pm             301 W Wulfenite                    $375,000

3-4 pm           4814 S Elves Chasm                  $335,000

Your Realtor^® host for Saturday's tour is Xavier Wynns of RE/MAX Peak Properties.

Click here to learn more about Flagstaff’s Ponderosa Trails neighborhood.

If this schedule does not work for you, and you are a qualified home buyer, contact Team Heitland at RE/MAX Peak Properties to arrange your private showing of any of these, or any other, Flagstaff homes.

Wednesday, June 3^rd, 6:00 - 7:30

Flagstaff Aquaplex @ 4^th / Industrial

As part of the Fourth Street overpass discussions with BNSF, the City agreed to study the possibility of closing either the Steves or Fanning rail crossing. The design firm, Kimley Horn, has been retained by the City to complete the study.  Some components of the study are compiling existing traffic information; having three public meeting from June to August 2009 and modeling traffic patterns if a crossing was closed.

The public meetings will be at the Flagstaff Aquaplex on the first Wednesday of June, July and August from 6:00 to 7:30 pm. At the first meeting on June 3^rd; existing traffic conditions, future projects that will affect the area and preliminary traffic modeling will be presented.

• At the second meeting on July 1^st; an analysis of the information gathered to date and public comments from the June meeting will be presented.
• At the final public meeting on August 5, preliminary recommendations will be presented.
• It is anticipated that a draft final report will be presented to Council in the month of September.

Your participation is critical for the public’s input to the Council and all ideas are welcome.

If you have any questions or concerns please Email Randy Whitaker P.E., Senior Project Manager at rwhitaker@flagstaffaz.gov or call 928-226-4844