Tuesday, December 22, 2009

TLC's "My First Home" is Coming to Tucson

My First Home is a half-hour series for TLC that focuses on the ups and downs of first-time home buyers as they undertake the most important purchase of their lives. They meet the buyers and learn what they are looking for and tell their story of how they found their first home. They will meet with the REALTOR who guided the buyers through each step as they search and find their new home. The show will combine the basic facts of home buying with the emotional journey of the buyers.

They are looking for couples who are outgoing, energetic, and interesting first-time buyers with a great story to tell. Every first-time buyer has a unique experience and wants to share these stories with other prospective first-time buyers.

All events that occurred during the buying process will be recreated. They are looking for the most memorable first-time buyers who closed between May 2009 and the end of December 2009. The bigger the personality and excitement for being on the show, the better the chance the buyers will be featured on the show.

There are no fees or costs to the REALTOR or Realty Company. If cast, they ask the REALTOR to be available during shooting and assist in finding homes that were similar to what the buyers saw during their search. During each half hour episode they will tour at least three homes (one is the actual home the buyers bought).

The production crew will travel to Tucson from Los Angeles and spend one week here recreating the home search and other events (home visits, inspection, meeting with lenders, etc.) as they happened.

All of the participants from the last three seasons had a great experience and enjoyed watching the final product. For more information on the show please go here.

They are looking for casting tapes to come in ASAP! The sooner they get a tape the better chance the REALTOR and buyers have of getting cast. The crew will be coming to Tucson in either January or February of 2010. Please contact Laura Kruszewski laura@tucsonrealtors.org or 520-382-8775 if you are interested.

Friday, December 11, 2009

Craig Childs

Last night Steve and I went to see Craig Childs at PCC. Craig is a fabulous nature writer who grew up in Arizona and lives in Colorado. He said he was delighted after arriving in Tucson by car at dawn Thursday morning to smell the delicious scent of rain. He talked about how the desert is all about water, and gave a Powerpoint presentation of photos he took of desert dunes and canyons. He puts himself in bizarre situations just to see what happens. For example, he enjoys burying himself in the sand in a remote desert, leaving only his head exposed, and staying that way for hours to see what kind of altered consciousness he can achieve. He was part of an international group of rafters and kayakers who made a first descent of a wild river in Tibet. The people who lived beside this ferocious river, which Craig said made the Colorado look like a joke, were horrified and begged them not to go. He showed us some videos of this muddy chaos taken from the bow of a catamaran.

Steve and I had the great privilege of spending a week on the Colorado River with Craig in 1998. We were on a commercial trip, and Craig was one of the guides. He was doing research for one of his many books about water. He was already appearing on NPR, so some of the rafters knew who he was and were very excited about having him for a guide. We were still clueless at that point.

Craig made a big impression on me because of two incidents. We were on an all-paddle trip, meaning no motorized boats and no oars. Everyone paddled every day. Lava Falls is largest fall on the Colorado River. It's also one of the scariest rapids because the huge black basalt boulders in the river have a rough surface that can tear a person up pretty good. Then there's always the possibility of a person swimming the falls and getting trapped under a boat or against a boulder. The power of the water is too much for mere humans to overcome. Hopi and white men ask for a safe passage from Vulcan's Anvil, a magnificent black cinder cone in the river upstream of the rapid.

When we got to Lava Falls, we all went up on an overlook to scout it and figure out the best path. Steve and I chose to be in the first boat to go through. The rest of the rafters were on the overlook, taking pictures as we went through, so I have a series of photos documenting what happened next. Steve and I were in the front of the raft, paddling in unison. Behind us were Craig and Steve's sister Lee. Behind them were Deb and George, a couple in their 60s. The head boatman Shay was in the middle back, telling us how to navigate the gigantic standing V-shaped wave we had to ascend with lots on power, going straight up the middle.

The photographic evidence shows Steve, Craig, Lee and me paddling in unison, even as we completely disappeared under the waves. In the back, Deb and George had their paddles in their laps and their hands over their eyes. We got part way up the V wave, and slid off the side. I fell out. I was under water a lot longer than I wanted to be. I surfaced, then went under again. When I came up, Steve grabbed me and held on through the rest of the rapids, then Craig and Steve pulled me into the boat.

My other favorite memory of that trip occurred in a flat, deep, narrow section of the river. The smooth Vishnu Schist walls shoot straight up for hundreds of feet. Craig asked everyone to be quiet. As we slowly floated in silence, he played his wooden flute. The music bouncing off the walls in that glorious place was ethereal. I told him last night, if heaven isn't like that moment, it should be.

He signed my copy of "Crossing Paths" like this: "For Donna and Steve and Lava Falls rising up around us".

Thursday, December 10, 2009

Where the Deer and the Coyotes Play

I'm sitting at the counter at Desert's Edge, sending off an offer on a short sale. I had already seen a covey of ten quail looking for food on the hill among the prickly pears. Then I saw two beautiful coyotes, looking uncharacteristically healthy. With their bushy tails and auburn highlights and wild yellow eyes, they were a stunning sight. I've seen javelina and deer here, but these are my first coyotes at my sweet desert home.

Friday, September 18, 2009

Fourth Avenue Update

Last Saturday Steve and I had a Guatemalan dinner at Maya Queztal on Fourth Avenue. Then we walked south to check out Papa Moai at The Hut. Elsewhere in this blog (October 28, 2007), I have a photo of Papa Moai, a giant Easter Island head, when he was at Magic Carpet Golf. Sadly, Magic Carpet is another pathetic case of pave paradise and put up a parking lot.

Papa Moai (as Tucson's famous cartoonist Max Cannon calls him in his strip) has found a glorious new home at The Hut, where we have enjoyed many a concert by incredible local bands. The Hut really spiffed up their front patio to make a suitable new home for this magnificent work of folk art. Gone is the nasty asphalt parking lot with the painted parking spaces. After walking through a door in Papa Moai's chest and admiring the tee shirts for sale there, you are transported to a funky beach town. Key West and Tamarindo are some of the suggestions on the M*A*S*H-style directional post. The ground is covered with sand. Palm trees wave in the breeze.

Our bud Bob Lanning of Lanning Architecture reports that he designed the new base for Papa Moai. He says,"The 43,000 pound head was moved in one piece. We all (owners, engineers, builders, architects) analyzed the head as it stood over at Magic Carpet Golf and decided, for a number of reasons, that the best approach would be to move the head, without the shoulders, over to The Hut and then install it on a new structurally sound base (the base is essentially the part from the neck down). So the construction crews severed the head at the neck (which took 3 days; it was a process), used two cranes to lay it down in one piece on a cradle on a flat bed trailer, and hauled it across town to The Hut (that was a site, to see the Head rolling down Speedway!). Then much later another crane hoisted it up and placed it on its new base. Then all of the finish work, like the new plaster, paint, etc. was completed. I think they still have a few ideas that haven't been completed yet, like they want to install a smoke machine so smoke, at times, comes out of his nose!"

Then we continued south to check out the long-awaited Fourth Avenue underpass. I don't care what its detractors say, I like it. The walls are panelled with tile that look like rusted metal. Gone are the old Doric columns of the original underpass, replaced with larger, round columns with three incised rings. It's wider, brighter, and cooler than before. We regret we didn't know about the opportunity to have our faces immortalized on one of the tiles at the entrance. Besides interesting-looking Tucsonans, many pets and a chicken made the cut. We look forward to the first All Soul's Procession in the new tunnel this November.

The experience was enhanced by some wonderful buskers playing on the sidewalk in the middle of the underpass. A violin and a steel guitar filled the cavernous space with exciting gypsy music. The sign in the musicians' guitar case said they were going to Seattle early the next morning. I hope some other musicians fill the space with delight this weekend.

Emerging from the underpass, we checked out some of the galleries on Congress. Who could ask for more than to enjoy the auditory, visual and gustatory pleasures of downtown Tucson on a clear summer night?


The Greek Festival starts Thursday, September 24 and goes through Sunday. Lots of fabulous food, music and dancing can be found at the St Demetrios Hellenic Center at 1145 E Ft Lowell, just west of Mountain.

When I lived a few blocks from here, I was always delighted to hear the joyous carnival atmosphere that filled the air.

Admission is $3 per person, and free for children under 12. If you visit between 5 PM and closing Thursday or noon to 6:30 on Sunday, you can go free, courtesy of Bill Anastopoulos of Bancapital Home Loans. You can meet Bill at the food booth.

I can't attach the free tickets to this email, but I can send them to you as a PDF, so send me an email and I will send you the tix.

The Snake Chronicles, Part IV

Well, it happened again last Sunday night. Steve came in my office, and quietly said, "Hon, we have a snake in the house." This is our fourth episode of Snake in the House at our current house. At our Broadmoor house, we had a little Blind Snake that was more like a speedy white worm that our cat Shadow probably brought in for everyone's amusement.

Inside our current house, this is our second King Snake. We also have had a Bull Snake. Plus a little one that Steve couldn't identify before it disappeared forever into the kitchen cabinets. The two that we were able to deport from this house went willingly, as we barricaded a path to the outdoors and stamped our feet until they overcame their fear enough to slither away to freedom.

This snake was the first to require elaborate snake removal apparatus. After Steve nearly stepped on it in the dark dining room, it went into his office, and thankfully for everyone concerned, it turned left behind his door instead of right along the impenetrable walls of bookcases and stuff. We threw a blanket over him while we pondered our strategy. He stayed put.

Using a technique we have perfected from years of gecko deportations, we put a plastic storage box over him. Then we slipped a piece of cardboard under the box and flipped the box over and put a lid on it.

Until our orange cat named Sunbeam appeared in our yard, we were glad to share the outside of the house with snakes, although a coach whip did chase Steve once, and that was sort of scary. But last summer we were horrified to see an enormous bull snake disappear into the grass, and watched Sunbeam stalk it. Fortunately, she mistook a hose for the snake, and pounced on the hose instead, but we realize that this cat just doesn't seem to have good sense.

So we had to release our most recent home invader away from the house. We drove to a secure, undisclosed location, and let him go. We hope he does okay there. We know he may not.

Kiddie Condos

Parents who want to buy a house for their children who live in a different town from the parents can do so using an FHA loan that is nicknamed "Kiddie Condo". This program is the only way the parents can get the lower down payment and lower interest rate of an owner-occupied loan. Otherwise, they have to buy the house as a second home or worse yet, as an investment, which is much more expensive. In recent years, people have also started using this same program to buy a house for their parents.

Catherine Elliwood at American Home Mortgage just sent me this information: FHA rules allowing borrowers to use owner-occupied financing for their children and aging parents is changing. The occupying co-borrower-- the child or aging parent--MUST have traditional credit, typically defined as at least three trade lines for a period of 24 months. So if you plan to purchase property for your child in college, you need to start with credit early. Get gas cards, secured credit cards or store cards in the child's name. Be sure they keep their balances low and repay on time. Remember, adding a child to an existing account as an authorized user will not contribute to his credit profile anymore.

If you need more information about the FHA Kiddie Condo program, please call Catherine Ellinwood at 954-1907.

Tuesday, September 8, 2009

August Residential Sales Statistics

The Tucson Association of Realtors has released the Residential Sales Statistics for August. Average and median sale prices were down from July to August, as were units sold. The number of active listings changed negligibly month over month, and were down 22% from last August.

With 7,336 listings divided by 980 sales in August, we have a 7.5 month supply of listings.

The luxury market will remain soft for at least a few more years. With 1,038 properties listed at over $500,000, and only 37 sales in that price range, we have a 28 month supply of houses listed above a half million dollars.

The under $250,000 market is where the action is. Seventy-nine percent the sales were in this price range last month. Seven hundred seventy-two of the 4,487 listings under a quarter million dollars sold in August. This means we have a 5.8 month supply of these houses. A six month supply is considered a balanced market, so the advantage has shifted to the sellers of low to moderately priced houses.

I have seen a sudden increase in activity in my own business in the past few months, and I have been involved in several bidding wars recently. First time buyers tend to be looking for houses in the under $150,000 range, and we actually have an acute shortage of good houses for these buyers.

Thursday, September 3, 2009

On the (Inside) Cover of Southwest Hydrology

My grad school bud Betsy Woodhouse is co-founder and publisher of Southwest Hydrology, a beautiful and informative trade publication. I told Steve that the hydrologist on page 5 of the most recent issue looked like Garrett Jackson, a geologist friend of ours who used to work at the Arizona Geological Survey at the desk I occupied after Garrett left for Seattle. Garrett also happens to be one of my fabulous clients, but we decided it probably wasn't Garrett posing with the RiverSurveyor, which looks a fun remote control boat.

Then Steve made a positive ID of another fabulous client and friend on page 2. There's Alison Jones with Clear Creek Associates! Alison, I see you have a conch shell and some Arizona minerals on your desk. What's that brown rock in the foreground? A memento from Maine or Louisiana? Actually, it looks like some sandstone I collected on Pinal Creek back in my well drilling days.

Saturday, August 29, 2009

2719 W Jennie Place

This adorable townhouse is located in my favorite part of town: the Tucson Mountains. Just east of Starr Pass Resort, and less than 15 minutes from U of A. My idea of a perfect location.

Two bedrooms and two baths. The country kitchen is large enough for a breakfast area, TV room, office or children's play room.
The enclosed back yard is sweet and private with a two-level wooden deck and a big old pine tree.
Out the back gate, you can walk to a small park within the complex. There you will find picnic tables, shade tress, grass, a barbeque and one of the two pools provided for your relaxation pleasure.

The other pool is at the west end of Jennie Place.

Click here for the floor plan. The cool thing about this floor plan is you can click on arrows that show you a photo from that location on the floor plan. You can also arrange furniture icons on the floor plan to see how your furniture would fit in the house.

Sold September 29, 2009 for $110,000.

Tuesday, August 18, 2009


My dear friend Alona has been staying at Desert's Edge for the past few weeks, and when she checked out the back yard this morning, she found this hawk eating a bird on the patio table. After taking this photo, she took her breakfast out to the porch and dined with the hawk. She said, "Where else can I eat breakfast with a hawk?" Where else indeed.

Saturday, August 15, 2009

Roberto el Gato

I have lived in Arizona for 19 years, and have always felt cheated that I haven't seen a bobcat. Now we have one living in our neighborhood, near Ft Lowell and Campbell.

Steve first saw him in our front yard on June 19. Our cat Sunbeam knew all about him, too, and has been much less interested in going outside than she used to be.

Our neighborhood listserv, which was set up as a crime watch, was abuzz with bobcat sightings. Most people thought it was wonderful, but a few thought the bobcat was a threat to children and pets, and wanted to form a posse to capture and relocate him, which of course would mean he would die. A few people noted that the abundant coyote packs that visit our neighborhood via Christmas Wash are a much more significant threat to pets, and no one is suggesting that we should or even could get rid of the coyotes.

The owner of the listserv announced that we were only supposed to discuss suspicious activity and crime on the listserv, and if anyone mentioned the bobcat again, she would bar them from the listserv. So we wondered for a few weeks whether the cat had been captured. Then we saw him in our yard. What a thrill! We feel so honored.

He's really gorgeous. Orange spots on ginger background with a short black and white tail. The fur on the sides of his face sweeps out into an down curving ruff with black and white stripes.

I love, love, love living in Tucson.

5151 S Montana Place

This home is outside my usual stomping grounds, but it is such a fabulous value, I couldn't resist. My client is a professional renovator. He and his wife bought this property a few months ago as a foreclosure, and they have completely transformed the house into a home.

New roof and evaporative cooler, fresh paint, paneled doors. Tile on all the floors. The oak kitchen has new counters, and the bathroom has deco tile. The back yard is enclosed with a new privacy fence.

I am especially excited about El Pueblo Community Center, only a block away. Swimming pool with water slide, basketball, day care, library, adult education, senior center, weight room, computers. It's amazing.

Three bedrooms and one bath. You can see the floor plan here. The floor plan is pretty cool. It has camera icons you can click to see views of the house. You can also play with furniture icons to see how furniture could fit in the house.

While the legal description says it's a townhouse, I did some research and found the homeowners association was dissolved in 1993, so there are no worries about fees and HOA politics.

This home sold December 1, 2009 for $66,000.

July Residential Sales Statistics

The Tucson Association of Realtors has published the Residential Sales Statistics for July. The news is ALL GOOD.

The average sale price in July was $210,767, which is down 17.3% from July 2008, but up 0.87% from June 2009.

The median sale price was $167,830, down 16.04% from a year ago, but up 1.72% from June.

There were 6,075 active listings, which is down an incredible 22.8% from last year, and down 2.97% from June. This is extremely welcome news. While foreclosures and short sales are still a significant part of the market, and their low sale prices continue to drag down the value of non-distressed sales, we are finally working through the fire sales.

Even more exciting, 1,184 sales closed in July. This is a 23.4% improvement from last year, and a 3.95% increase from June.

With 6,075 listings and 1,184 sales, we have a 5.13 month supply of listings. This gets us below the magic number of six month inventory, which is considered a balanced market.

Prices have been stable all year, and the $8,000 tax credit for buyers who haven't owned a house in the past three years is definitely resulting in sales. If you've been waiting for the bottom, you might be looking at it right now.

Wednesday, June 10, 2009

22% of Purchase Price in Down Payment Assistance!

Loan Officer Extraordinaire Chris Bass just told me she is in the process of becoming one of the lenders authorized to offer this wonderful down payment assistance program. Check out the good news!


The Arizona Department of Housing will offer 22% of the purchase price in purchase assistance to QUALIFIED HOMEBUYERS purchasing an eligible FORECLOSED home in Tucson. This program is NOT JUST FOR FIRST TIME BUYERS! The guidelines are:

1. 620 Minimum FICO score
2. 31/43 debt-to-income ratio. A maximum of 31% of your gross monthly income can be spent on the mortgage payment, and 43% (including the mortgage payment) of your gross monthly income can be spent on all your recurring debts like car payment, minimum credit card payments and school loans.
3. The property must be your primary residence.
4. Condos and townhomes are allowed.
5. The property that is being purchased must be a foreclosure.
6. The property must be vacant at time of listing.

A minimum of 1% of the down payment must be buyer's own funds. 2% can come from any other approved source or gift. 3% down payment is required.

The maximum purchase price for Pima County is $316,250. The seller must agree to sell for 5% under the appraised value.

Borrowers must attend an eight hour training class. Funds are limited, so please don't delay.

To see whether you're eligible for assistance, check out Your Way Home AZ.

Call Chris Bass at American Home Mortgage.
Cell phone: 520-909-1565

Or apply online

Saturday, June 6, 2009

Screech Owl

I was standing in the back door way at Desert's Edge a few mornings ago, looking in the desert for the javelina family that wandered through the back yard while we were having dinner on the porch the night before. No sign of the javelina, but I looked up to the rafters of the porch and saw a sleeping screech owl. How exciting! I had planned to eat breakfast on the porch, but I decided to eat inside, leaving the door open. The owl gradually realized I was there taking pictures, and flew away. But I had a good fifteen minutes to check him or her out.

I wonder if that is what I heard up in the attic about 3 AM? There was something up there that sounded BIG, tearing and scratching. I looked all around the eaves, and the largest hole is about an inch wide tear in the screen on the bird board. Hmmm.

Then, a while later, I was sitting at the kitchen counter with the door open and a cactus wren hopped in and perched under the backgammon table. I thought about chasing it out, but decided that might scare it off further into the house, so we just kept eyeing each other until it hopped back out the door.

What a wonderful place.

Friday, June 5, 2009

Night Blooming Cereus

We had a record bloom of the night blooming cereus that sprawls all over Steve's wood pile. May 27, five blooms caught our interest. We could see that the big night would be May 28, so we put post it notes all over the house to remind ourselves not to miss it. We were really excited to count 55, 56 or 57 blooms that night! Wow! We counted over and over, and got a different number each time, so we aren't sure exactly how many flowers we had, but it was very impressive. The old cactus still wasn't done showing off, and May 29 we had five more blooms and then on May 30 there were two.

Last year I wondered whether the full moon had anything to do with the timing of the bloom, but I guess it doesn't. The moon was just a beautiful new sliver this time.

May Residential Sales Statistics

The Tucson Association of Realtors has released the Residential Sales Statistics for May. It's all good news. The average sale price was $204,125 and the median sale price was $170,000. These were 6.14% and 3.72% increases since the previous month. The number of units sold was up 6.93% and the number of listings was down 5.57% since April. With 6,505 listings divided by 987 sales, we have a 6.6 month supply of houses. A six month supply is considered a balanced market, with no advantage to the buyer or seller. This is a huge improvement from the dismal 13 month supply we had in December.

The under $300,000 market continues to be strong. I have seen bidding wars and quick sales. Many buyers are realizing that these low interest rates can't last forever. The $8,000 tax credit for people who haven't owned a home in the last three years will expire December 1 this year. Now's the time to make a move, before -- dare we say it? -- the inventory dips below a six month supply.

Thursday, June 4, 2009

3453 N Richland Drive

This incredibly affordable townhouse is located in the desirable Richland Heights neighborhood, northeast of Campbell and Ft Lowell. It has eco-friendly bamboo floors through out. The central air conditioner was new in 2005. Also has evaporative cooling for maximum energy savings.

The living room is spacious and has a high vaulting ceiling with clerestory windows. The corner fireplace provides a cozy touch. Sliding doors lead from the living room and master bedroom to the private walled patio. A generous dining area is between the living room and kitchen.

The two bedrooms and two baths are augmented by a den, which could easily be converted to a third bedroom by reworking the hall closet so it faces the bedroom. Check out the floor plan to see how it could be done.

The pool, spa and ramada offer a great oasis for relaxing and entertaining.

The Homeowners Association fee covers common area maintenance and insurance, garbage collection, water, personal and common area structural insurance, and building exterior and front yard maintenance.

This townhouse sold for $120,700 on July 21, 2009. What a shame the price was dragged down so low by foreclosures, the $180 per month HOA fee, and the need for maintenance in the complex. The maintenance will not be started until the HOA finishes collecting a $100 per month special assessment from each homeowner at the end of 2010.

$8,000 NOT Available for Closing Costs, Either

More chaos from Housing and Urban Development. The $8,000 tax credit for home buyers who haven't owned a home in the last three years can not be used for closing costs in Arizona. Only 14 states have set up the non-profit organizations that are needed to make short term loans to home buyers. The home buyers will pay back the loan when they file an amended tax return. Arizona is not one of the 14 states to create this non-profit organization.

The only thing a home buyer in Arizona can do to get some of the $8,000 prior to buying his home is to reduce his income tax with holding. To find out how to do that, check here.

To qualify for the $8,000 tax refund, the home purchase must be completed before November 31, 2009.

This is free money! If you qualify, now's the time to buy a house.

$8,000 NOT Available for Down Payment (But It Can Be Used for Closing Costs)

Doesn't inspire much confidence in our government when they keep announcing stuff and then retracting their announcements, does it?

This is from the National Association of Realtors:

HUD: Tax Credit Can Be Used on Closing Costs

FHA-approved lenders received the go-ahead to develop bridge-loan products that enable first-time buyers to use the benefits of the federal tax credit upfront, according to eagerly awaited guidance from the U.S. Department of Housing and Urban Development on so-called home buyer tax credit loans that was released today.

Under the guidance, FHA-approved lenders can develop bridge loans that home buyers can use to help cover their closing costs, buy down their interest rate, or put down more than the minimum 3.5 percent.

The loans can't be used for the borrower's minimum investment of 3.5 percent of the sale price, senior HUD officials told reporters on a conference call Friday morning.

Thus, buyers applying for FHA-backed financing with an FHA-approved lender that offers a bridge-loan program can get a bridge loan to bring down the upfront costs of buying a home significantly but would still have to come up with the minimum contribution of the 3.5 percent downpayment.

The first-time homebuyer tax credit was enacted last year--and improved upon earlier this year--to help encourage households to enter the housing market while interest rates are low and affordability is high. The credit is worth up to $8,000 (10% of the purchase price, so as long as you pay over $80,000 for your house, you get the whole $8,000) and is available to households that haven't owned a home in at least three years. The credit does not have to be repaid, and is fully reimbursable, so households can get their credit returned to them in the form of a payment. This means if you don't owe $8,000 in federal taxes, you get the difference between $8,000 and your federal tax obligation as a cash refund!

Learn more about the credit, including how to apply for it this year even if you've already filed your taxes, at www.REALTOR.org

Thursday, May 28, 2009

$8,000 Available for Down Payment

What's the biggest hurdle stopping first time home buyers from taking advantage of the perfect storm of low prices and low interest rates? Lack of a down payment, of course.

Homebuyers who have not owned a home in the last three years can receive a $8,000 federal income tax credit if they buy before December 1. For about 12 hours a few weeks ago, the U. S. Department of Housing and Urban Development said the $8,000 could be received at closing instead of after closing. Then the backed off. Now it seems they are going to revive the idea. The following is just in from REALTOR® Magazine Online.

HUD: Homebuyer Tax Credit Loans Still on Track
News reports that the federal government is backing away from its plan to permit eligible borrowers to monetize the first-time homebuyer tax credit are off the mark, a spokesperson for the U.S. Department of Housing and Urban Development says.

"The technical details are still being finalized and will soon be published in a mortgagee letter and posted on our Web site," Lemar Wooley, a HUD spokesperson, told REALTOR® magazine Wednesday afternoon.

Under the guidance that's under development, state agencies and other HUD-approved entities would be able to provide short-term bridge loans that households could use to help with their downpayment. The loans would be repaid with the proceeds from the households' federal tax credit.

The loans were announced on the opening day of NAR's 2009 Midyear Legislative Meetings in Washington, D.C., last week. In his announcement, HUD Secretary Shaun Donovan said guidance would be issued shortly.

When the guidance is released, it is expected to cover eligible lenders and set parameters for loan terms and repayment.

Wednesday, May 27, 2009

Walk Score

Green is the most sustainable color. As energy costs increase and resources are depleted, more and more people are recognizing the benefits of energy conservation, clean air and healthy living. I have talked with several buyers lately who have told me they want a home that's close to shopping, restaurants, services and entertainment. The green word for this type of location is "walkable".

I have discovered a fabulous web site where you can type in an address, and get its "walkability score". You will get a map showing all the amenities close to the address, and a ranking from 0 to 100 indicating the ease of living at that address without a car.

Try it. It's lots of fun.

Home Valuation Code of Conduct

On May 1, the home appraisal industry underwent a devasting overhaul. I don't know who is benefiting from the increased cost and delay in getting a home appraisal, but it's not lenders or borrowers.

This sort of government intervention is exactly what the housing industry doesn't need. How about making it easier for qualified borrowers to buy a house, instead of harder?

Check this article from the Los Angeles Times.

Friday, May 22, 2009

Carnivaleros CD Release Tour

Speaking of Jim Lipson, check out his article in the Tucson Weekly about another of my favorite clients, Gary Mackender, squeeze box operator and leader of the amazing Carnivaleros.

You can find Doc Squeeze and his cohorts tonight at 9 at Plush on 4th Avenue; Sunday at Boondocks on 1st Avenue at 6, and on Sunday, June 13, they will be at the scene of the crime, Triangle L Ranch in Oracle.

Wayback Machine at 17th Street Market

This just in from my client extraordinaire Jim Lipson, percussionist with Wayback Machine.

This Saturday, the Wayback Machine will violate one of its sacrosanct rules: performing before the noon hour. They make an exception for their debut at the World Music store in the 17th St. Market.

For almost three years, the Market has enriched Saturday shopping by showcasing live music from 11:30am to 3:30pm. If you have not yet been to the 17th St. Market or Music Store, do yourself a favor and check it out: fresh produce, fantastic fish market, extensive array of Asian groceries, acoustic instruments, local CDs, and lots more.

The Market is at 830 E. 17th. St. just west of Euclid Ave., in the old warehouse district close to the train tracks. Take Euclid south from Broadway, turn west on 18th St., then follow the signs north and west to the Market.

For this acoustic gig they'll be joined by Shanti Foster on violin, mandolin and guitar and Mike Begala on guitar and mandolin.

Tuesday, May 19, 2009

Chicken Coop Tour

Years ago, a woman who lived next to one of my clients in Northwest Tucson gave me some gorgeous green eggs from the hens she kept in her back yard. The yolks were a rich deep yellow and the taste was fantastic. Ever since, I've wanted to have my own chickens.

I've been thinking lately that we need to get more self sufficient. Plant an organic garden, install some solar panels and a rain water harvesting system, and get some chickens.

I guess a lot of other people are thinking the same way, because this Saturday from 9 to noon, the Food Conspiracy Coop is sponsoring a back yard chicken coop tour.

A lot of these chicken wranglers are way ahead of me in the sustainable technology game, and some of them will be demonstrating their solar ovens, rain water harvesting, and other cool ideas.

Tuesday, May 12, 2009

Odyssey Storytelling

I always like to brag about my amazing clients, and here's one who will be famous for more than fifteen minutes. Adam Hostetter was interviewed on Arizona Illustrated about the Odyssey Storytelling event at Club Congress this Thursday at 7 PM.

Adam writes a fabulous blog about his conversations in airport bars. Check it out.

An Original Rock Opera Here This Weekend

Graphics and Poster design by Maria A Sans Fuentes .

Another talented client, Hoshin Gupta, has co-written a rock opera that will be performed in concert with the Zuzi Dance company this weekend.

His musical ensemble, Water on the Rocks, has teamed up with Zuzi! to put on "Like a Lotus Resting in Fire: The Great Dance" a theatrical production to benefit Casa De Los Ninos. Come see an amazing show, enjoy an evening of music, dance and poetry, and help support a great cause.

Friday, Saturday and Sunday evenings, May 15, 16 and 17 at 7:30 PM and Saturday and Sunday matinees, May 16 and 17 at 2:00 PM.

General Admission $20; Students and Seniors $15. Advance Tickets are on sale at ZUZI! Dance Company (520-629-0237). Tickets can also be purchased at the door before the shows at ZUZI’s Theater in the beautiful and historic YWCA at 738 N. 5th Avenue, just south of University Boulevard.

Monday, May 11, 2009

Living Green

My client Pamela Portwood is an interior designer who owns the green design company Greener Lives LLC. The Renovation Nation show on the Planet Green television channel recently visited Tucson to talk with a family who hired Pamela to help them design a non-toxic, environmentally-friendly nursery.

Friday, May 8, 2009

April Residential Sales Statistics

The Tucson Association of Realtors has released the Residential Sales Statistics for April. The average sale price was $193,351, down 5.3% from the previous month and down 23.8% since April 2008. Median sale price was $164,000, down 0.61% since March and down 15.9% since last year. However, except for a blip upward in February, the median sale price has been stable since the first of the year.

882 units sold, which is down 1.12% since March and down 13.1% since last year. The good news is active listings continues to decline, reaching 6,890 in April, which was down 7.08% from March and 21.78% since last year.

The reduction in number of houses for sale means we continue to get closer to a balance market, which is a six month supply of listings. With 6,890 active listings and 882 sales in April, we now have a 6,890/882 = 7.81 month inventory.

Getting a jumbo mortgage (over $417,000) usually requires 30% down payment and involves a 2% jump in the interest rate above the current 5% rate offered on conforming loans. So the luxury market will suffer until lending restrictions are loosened. Only seven properties priced over $750,000 sold last month. Similar to last month, 87% of the sales were of properties priced under $300,000.

Housing Opportunity Index

The National Association of Home Builders and Wells Fargo have released the Housing Opportunity Index for the fourth quarter of 2008. The HOI measures the percent of houses sold in each of 222 cities that were affordable to a family earning the median income. The index assumes the family will spend 28% of their gross income on their house payment.

The median income in Tucson was $55,000 and the median house sale price was $170,000, according to this study. This makes 64.1% of our houses affordable to the average family. We ranked 132 in affordability nationally.

Lots of other data are available at this site. It's interesting to see how interest rates affect affordability. Obviously, with interest rates currently at historic lows, a family's home buying dollars will stretch a lot further today than they will when interest rates go back up to more normal levels.

Saturday, May 2, 2009

Real Estate Transfer Tax

A real estate transfer tax (RETT) is charged at that time a property is sold. While our city, county and state governments are not currently considering a RETT, it has been the topic of revenue enhancing proposals in the past. With our governments running deficit budgets these days, the RETT is likely to rear its ugly head again.

What's wrong with a RETT? Plenty. We already pay property tax. This would be double taxation. It is only charged to property owners who sell, so it is discriminatory. It reduces a seller's equity, and is a further impediment to selling. As if sellers need any more challenges in this market!

The Arizona Association of Realtor is currently collecting signatures so a state wide ban on RETTs can be put on the November ballot. They need 230,000 signatures by early July. We won't know the proposition number until the signatures are validated.

Once we know the proposition number, we will be spreadng the word to vote YES. A yes vote will prohibit state, county and city governments from ever imposing a real estate transfer tax.

For more information, go to No New Tax On Our Homes.

Saturday, April 11, 2009

Mountain Oyster Club

Last month I had some buyers who used to be members of the Mountain Oyster Club, which was at the southwest corner of Stone and Franklin in the old Jacome Mansion. The Mountain Oyster Club's website states that according to legend, the club was originally founded in 1948 by ranchers who got thrown out of the more staid country clubs. The Jacome mansion was the club's home for 30 years until for various reasons the members moved to a new location.

Subsequently, someone tried without success to open a restaurant in the former club headquarters. Now the old 14,000 square foot mansion is for sale for $1,000,000 and my buyers wanted to see whether they could turn their old club back into a home.

While the project wasn't feasible for my buyers, it was fun to see the inside of this amazing building. A dome visible from the outside covered a second story swimming pool, surrounded by columns.

I was particularly intrigued by the murals done by a naive Tucson painter named Corona. I couldn't find out more about him, but I'm told his murals were all over town. I especially liked his use of small round mirrors in the paintings.

I sure hope someone can rescue this old Tucson treasure. It is listed with Ron Campbell of Long Realty Company.

Solar Power

A few weeks ago, I went to a solar power workshop sponsored by Congresswoman Gabrielle Giffords and Tohono Chul Park. I have often wondered why Tucson isn't the solar capital of the world. I learned that for solar power to be practical on a large scale, we would need not only a lot of sunshine, but also a lot of water. A solar power plant uses the sun to heat salt water solution. The steam turns turbines, which produce electricity. So solar energy production is not feasible for public utilities in deserts with the current technology.

Getting off the grid is very expensive, and is only practical in remote areas where connecting to the power grid costs more than $100,000, which is the cost of an off-grid system.

The good news is that homeowners can generate their own electricity and send the power to the public utility company for storage. Then the homeowner will have power at night and on cloudy days. However, if TEP's power is down, the homeowner will be without power unless they have a battery back up. Power outages are not currently a problem in Tucson, so this back up is not essential at this time.

Installing 3,000 kilowatt hour (kWh) solar hot water requires a $4,500 investment. TEP will give the homeowner at $1,500 rebate. State and federal tax rebates are also available, making the out of pocket cost about $1,000. The pay back time is about three to five years.

The typical home uses 11,000 kWh per year. Installing a system that could produce that much power would cost about $44,000. The TEP rebate would be $20,000 and the state and federal tax credits would be $1,000 and $7,000, leaving a net cost of $16,000.

For every kWh produced by a solar electric system, the owner can save 10 cents on his TEP bill. A typical 3 kW system will reduce the monthly bill by about $40.

For more information, go to www.Giffords.House.Gov .

Of course, before considering any solar energy projects, it's important to improve the energy efficiency of your home and adjust energy use patterns to minimize wasted energy.

Tax credits are available for installing energy efficient products like water heaters, furnaces, air conditioners, building insulation, window, roofs and doors. I received a tax credit for installing Solatubes because they don't transfer heat to the extent that skylights do, and they enable me to leave the lights off in rooms that used to be dark during the day. For more information go to www.energystar.gov.

Surprise! Mortgage Application Audits

A couple weeks ago, one of my buyers signed all the loan documents to buy his house, and I told him I'd see him in a few hours to give him his keys after the deed recorded. Unfortunately, I was wrong.

The lender called me just two hours before we all thought the deed would record to inform me that the borrower's loan application was being audited, and this could take up to three days. My buyer's plans to move into his new home over the weekend and have out of town guests stay with him were ruined.

No one had ever heard of a quality control audit after the loan documents were signed, and that's because it had never happened before. Fannie Mae and Freddie Mac, the quasi-governmental agencies that buy bundled loans so mortgage lenders can keep on lending, have started to refuse to buy loans if there is any hint of fraud in the loan application. They already own enough foreclosed houses because of borrowers who lied about their intent to occupy the house, provided bogus employment information, or obtained inflated appraisals.

In order to convince Fannie and Freddie that the loans they are buying are good, lenders have implemented this QC audit procedure. Some lenders are comparing the tax return the borrower provided with his loan application against the tax return submitted to the IRS. Background checks on borrowers are also occurring.

My borrower's application survived the QC audit, but not without a weekend of anxiety and inconvenience.

Bottom line is that it is taking longer to get a mortgage loan processed because of this new QC audit procedure. Anyone who intends to do anything slightly fishy on their loan application should forget it.

Saturday, April 4, 2009

March Residential Sales Statistics

Instead of taking their usual two to three weeks to leisurely compile the residential sales statistics, The Tucson Association of Realtors published the March stats on April 3. I think providing these sale data is the most important function of TAR, so I'm glad they finally agree with me.

After a 6.8% increase in average sale price from January to February, we saw an 8.1% decrease from February to March. Number of listings continues to decline, down to 7,415 in March. Happily, the number of sales was up 35.36% from February to March, with 892 homes sold last month. 7,415 listings divided by 892 sales equals an 8.3 month supply of listings. This is a huge improvement over the 13 month supply we had a few months ago. When we get back to a six month supply, the market will be considered balanced, with no advantage to the buyer or the seller.

The low prices combined with unbelievably low interest rates (4.5% owner occupied! 5.5% investor!) are the primary movers of houses right now. Savvy buyers see this as a once in a lifetime opportunity.

The luxury market remains weak, with only 15 sales over $750,000. Eighty-six percent of the sales were of properties under $300,000.

In my own business, I am seeing several first time home buyers who are excited about the $8,000 tax credit. This is free money that no qualified buyer should pass up.

Friday, March 20, 2009

Open House at 211 E 2nd St

When you're through walking around the Fourth Avenue Street Fair this weekend, head a few blocks northwest to the fabulous house I will be holding open from 1 to 4 on Sunday. 211 East 2nd Street is two blocks south of Speedway between 5th and 6th Avenues.

This 1912 Craftsman style bungalow is quintessential West University. Of course, it has an embracing front porch, maple floors, big windows, French doors, high ceilings, rich wood accents and character galore. But there are surprises, too. You'll say "I'm going to do that at home!" when you see the shower that reminds me of a Japanese garden.

The kitchen has been updated and rearranged so you can happily cook holiday meals here that you will serve in the formal dining room. The pool is the highlight of the back yard oasis.

This property is listed by Susan Denis of Realty Executives Southern Arizona for $435,000. The seller (a fellow Realty Executives agent) has a fabulous sense of design, and the furnishings are enchanting. You can have everything in the house except the art, electronics, and the kitchen knife set for only $5,000 more. Move into this dream home and you don't have to buy a single chair, towel or dish. You won't want to leave this warm and serene retreat, and here's a rare opportunity to buy the ambiance along with the house.

National Appraisers

Effective May 1, all lenders must submit a request to a national appraisal clearinghouse and an appraiser will be assigned to appraise the property. Currently, lenders choose their appraisers. This usually means the lender is able to get the appraisal done quickly by a competent appraiser. The perceived downside is that some lenders may pressure their appraisers to cook the appraisal and overvalue a house so a sale can close or a mortgage refinance can occur. This is the problem the national appraisal clearinghouse is supposed to fix.

I don't know if anyone has any statistics on how many bogus appraisals were the results of collusion between the lender, the real estate agent and the appraiser. It would be interesting to know whether this problem was big enough to warrant this "solution". In general, I don't think borrowers are going to benefit from this new policy. They are going to pay more for their appraisal--perhaps $150 more--and that fee will go to the clearinghouse to pay them for the appraiser referral. The appraiser will make less. The worst part is the delay caused by this added layer of bureaucracy. It can take up to three weeks to get an appraisal by this system, which some lenders have voluntarily adopted ahead of the May 1 deadline. We will no longer be able to get sales closed in 30 days. If the interest rate is favorable to the buyer on the day his contract is accepted, he won't be able to lock the interest rate for 45 days for free. He will have to pay at least 1/8 point (one-eight percent of the loan amount) for the 45 day lock. Locking for 30 days is free, but 30 days locks will be useless under this system.

I would like to know which industry lobbied for this legislation. Follow the money. I don't think this originated with a consumer group

February Residential Sales Statistics

The Tucson Association of Realtors has released the Residential Sales Statistics for February. Finally, some positive news. From January to February 2009, average sale price in Tucson increased 6.76% to $222,207 and median sale price increased 9.04% to $178,000. Is the downward tumble over? It's too early to tell, but other indicators are encouraging. Number of units sold were up 12% from the previous month and number of active listings were down 2.11%. With 7,352 listings and 659 sales in February, we have an 11 month supply of listings. This is far from the 6 month supply of listings that indicates a balanced market, but at least we are now heading in the right direction.

The increase in the FHA loan limit was a big help. Last year, FHA had practically no market share. Because conventional financing requires at least 5% to 10% down payment, FHA is the loan of choice for many borrowers with limited savings. FHA and VA loans accounted for 33% of the sales. Conventional mortgages (not government-insured) were 39% of the market, and cash accounted for 25% of the sales.

What is selling? The entry-level market is strong. Eighty-one percent of the sales in February were of properties priced under $300,000. While there were 1,297 houses priced over $500,000, only 38 of them (less than 3%) sold last month.

Tuesday, March 3, 2009

Quail on the Window Sill

Every spring, a quail couple will discuss the possibility of building a nest on the window sill of my home office. They walk back and forth, tapping on the window, and squeaking their comments about the pros and cons of the home site. Pros: 1) it's off the ground behind the security bars and 2) vines partially obscure the sill. Apparent cons: 1) when the chicks are born and get adventurous, the three foot fall to the ground may be hazardous to their health, 2) then there's that large animal with the camera on the other side of the window and 3) this year, there also seems to be a cat in residence. They always decide against the nest site, but it's fun to watch them up close.

Friday, February 20, 2009

New FHA Loan Limits

Back during the wild and crazy lending days (less than two years ago) of no documentation of credit worthiness, no income verification and no down payment required, conventional loans ruled. Nobody got an FHA loan because sellers wouldn't accept the repair requirements that went with them, and borrowers who couldn't put 3% of the purchase price into the loan couldn't qualify for them.

Now a borrower needs a minimum of 10% down to get a conventional loan. Those who don't have that amount are left with FHA.

Last month, FHA loans were used on 28% of the sales in Tucson. VA loans were 8%, conventional loans were 35% and cash sales accounted for 27%. FHA is the loan of choice for many first time home buyers.

After being temporarily raised last year, on January 1, the limit on FHA loans dropped to $271,050. This made home financing unavailable to a significant part of the population.

The new stimulus package passed this week raised the FHA limit to $316,250. This is welcome news, especially for people who have houses priced above $271,050. Now they have a better chance of selling.

In January, a whopping 83% of the home sales in Tucson were under $300,000. The higher FHA loan limit should help move more properties.

Wednesday, February 18, 2009

Ice Cream Truck

I was out doing battle with thorny plants in my yard this afternoon, when I was thrilled to hear an ice cream truck. When I was a little girl in Massachusetts, the sound of the ice cream truck would send everyone running for home to beg for ten cents so we could buy a push up or fudgicle. Even running on very short legs, we still had time to catch up with the ice cream man who slowly and patiently cruised the neighborhood, trolling for sweet-craving children.

Today's ice cream truck was playing "O Suzannah!", which made sense, followed by "Love Story" (the Ali McGraw/Ryan O'Neal thing) which didn't make any sense at all. The ice cream truck of my youth only played one song, "Pop Goes the Weasel". It was monotonous, but I guess children like the predictability.

I grabbed my camera, and only had enough time to get one shot of the tail end of the speeding ice cream truck. I think the driver is unclear on the ice cream truck concept. Anyway, I'm delighted to live in a place where the ice cream truck comes around in February because when it's summer in Tucson, eating ice cream is too messy.

Open House This Sunday

Realty Executives is having a Mega Open House this weekend, with over ninety houses being held open. Starting Friday, you can see the list of houses at the Realty Executives Southern Arizona website. I will be at 1034 N 7th Avenue in West University on Sunday from 1 to 4 PM. This gorgeous bungalow was built in 1917, across from De Anza Park, just south of Speedway.

Of course, the home has wooden floors and a fireplace. Central air conditioning. Beautifully upgraded kitchen with granite counter tops. Lots of Craftsman Style built in shelves and cabinets.

I'll be there with my trusty side kick Chris Bass from American Home Mortgage. She will be prepared to explain all the Byzantine ins and outs of mortgage lending in 2009, as only Chris can. Please come by and see us and have a cookie!

This house is listed by Susan Denis of Realty Executives Southern Arizona.

What's In The Stimulus Package for Home Buyers?

The $15,000 tax credit for homebuyers that passed the Senate was shot down in the final stimulus package. What's left isn't bad, though. Details are still being worked out, but this is what we know at this point.

1) First time homebuyers (defined as those who have not owned a home in the past three years) are eligible.
2) Home must be purchased Jan 1, 2009 through Nov 30, 2009. This part is dumb. If it's supposed to stimulate the economy, why give the credit to people who have already bought?
3) Buyer can deduct $8,000 from the federal income tax they will owe for 2009 OR 10% of home's value, whichever is less. If the buyer owes less than $8,000 in federal taxes, the balance will be refunded to the buyer. Wow!
4) Available to couples with income less than $150,000 and singles with income less than $75,000.
5) Credit must be repaid if buyer lives in the property for less than three years. This is better than the $7,500 tax credit that was offered last year. Last year's tax credit was really just a no interest loan that had to be repaid.

Tuesday, February 17, 2009

January Residential Sales Statistics

The Tucson Association of Realtors has released the residential sales statistics for January 2009.

Average and median home sale prices were down 21.51% and 19.58% from January 2008. Average sale price was $208,133 and median was $163,250.

January is the slowest month of the year, and number of units sold was down 5.31%. Fortunately, new listings were down 36.94% and active listings were down 16.08% from the previous year.

Divide 7,694 active listings in January by 588 sales, and we have a 13 month supply of listings. The buyer is at a strong advantage in this market. The successful seller prices his house appropriately, and he is meticulous about the condition and appeal of his house. Sellers who have a take it or leave it attitude will find that buyers will be happy to leave it.

Monday, February 16, 2009

1009 N Queen Ave

Here's a wonderful opportunity to build in desirable Dunbar-Spring, a neighborhood of restored bungalows built in the 1930s. Conveniently located close to U of A, downtown and all the great shops and restaurants on 4th Avenue. This could be the multicultural setting of your urban dreams. Activists, professionals, environmentalists and long-time Tucson families make a unique and cohesive clan. Check out the community garden, playground and ramadas at University Boulevard and 11th Avenue.

5,515 square feet (0.127 acre). The property already has gas, water and sewer lines on the lot, with electricity at the lot line. Owner will carry mortgage.This property went off the market in June 2010 at $59,000 because nearby foreclosued houses were selling for not much more than that. Please call me if you are interested in this property. 520-909-1171.

Sunday, February 8, 2009

New Appraisal Guidelines

Fannie Mae, the quasi-governmental agency that buys bundled mortgages from mortgage lenders, issued new appraisal guidelines that went into effect January 1. For the most part, this is a good thing, and way overdue. Inflated appraisals are part of the reason house prices ballooned beyond reason.

Appraisers must now note incomplete additions and renovations, as well as conditions that affect the livability, soundness or structural integrity of the building. The property must be appraised subject to completion of the additions or needed repairs. This sure would have prevented me from closing a few sales last year.

The sales contract must be provided to the appraiser so the appraiser will know whether the seller is paying the buyer's closing costs or making repairs. These circumstances result in a lower net to the seller, and may result in a lower appraised value.

Now that 100% financing is no longer available, buyers with limited funds are routinely asking the seller to pay the buyer's closing costs and make repairs. So if a seller has to pay $4,000 in buyer's closing costs and $5,000 in repairs to get his house sold for $200,000, in effect, the sale price was $200,000 minus the seller concessions, or $191,000.

When there are no comparable sales near the property being appraised, and the appraiser has to look more than a mile away for "comps", the appraiser has to explain why the comps are outside the usual mile radius. The appraiser can not ignore nearby comps just because they are foreclosures or were sold under duress.

The appraiser must analyze market trends, and if home sale prices are declining in a neighborhood, time adjustments to the values of the "comps" may be required.

This is what the new appraisal form looks like.

How to Save the Housing Market

While deregulation and fraud have their place in calamity that is our economy, the housing market plays a central role in our current mess. Mortgage money was too easy to get. The competition for houses, combined with "irrational exuberance", as Alan Greenspan so aptly named it, drove house prices out of reach of working people. In 2005, a large percentage of the home sales were to investors who expected a quick profit. Many owner-occupants who had no down payment were willing to spend too much of their monthly income on a mortgage payment. Most people believed (or hoped) that home prices would continue to rise at a rapid rate indefinitely.

We all know where that got us. Now at least a third and maybe more of the sales in Tucson are foreclosures. This is hurting everyone, even people who are still making their mortage payments on time. Even the people who own their homes free and clear should be alarmed about this situation.

When a seller who is not in financial distress wants to sell his house, he is faced with the disheartening news that his house will have to appraise for the sale price, or the buyer will not be able to get a loan. An extremely busy loan officer recently told me that half of her clients, whether they are refinancing a house or trying to buy a new one, are unable to get a loan because of appraisal problems. Lending standards are much higher than they were in the go-go days, but even people with stellar credit are finding that the appraisal prevents them from getting a mortgage.

Why are appraisers not appraising houses at sale price anymore? New appraisal guidelines went into effect last month. See the above post, "New Appraisal Guidelines". As a result of these guidelines, appraisers must use foreclosed properties on their appraisals as comparable sales ("comps"), if those properties are the nearest sales, geographically and in size, to the property being appraised.

Of course, foreclosures sell for below market value. Way below. When they are included as comps on an appraisal of a house that is not being sold under duress, the foreclosures drag down the value of the subject property. A reduction in the average home price that puts homeownership back into the reach of the average family is a good thing. Unfortunately, using foreclosures as comps is dragging the average sale price way too low. Some people who bought at a reasonable price, with significant downpayment, and who made their payments on time, can no longer sell for enough to pay off their mortgages. This horrifying situation will increase the number of foreclosures. Prices will continue to spiral downward. It's a vicious cycle. Nobody wins.

The part of this whole foreclosure nightmare that I can't understand is how these lenders can write off so much bad debt. A lender will foreclose on a homeowner and kick him out of his home. Then the lender sells the property to a jubilent buyer who pays $100,000 less than the lender loaned on the property. If the lender is able to write off that debt, then why don't they renegotiate the mortage with the mortgage holder, and let the person who owes the debt stay in the house? We would have far fewer foreclosures, a lot less misery, and home values would not be dragged down by using these foreclosures as comparable sales.

We are all in agreement that our government stimulus program should not continue to reward the wealthiest individuals in our society, who should be in jail for what they've done to the economy. What I can't understand is this: why can't lenders work with people who can not make their mortgage payments, and keep these people in their homes, instead of foreclosing and selling these houses at a fire sale?

We need to start thinking beyond quarterly profits to long term sustainability and economic recovery.

Monday, February 2, 2009

The Gem Show is Back!

Yesterday Steve and I went to the Tucson Gem and Mineral Show with our buds Carol and John. We started at Inn Suites, always the home base of some great dealers. I have the advantage of living with a Gem Show devotee, who has gone to the Show religiously for 24 years, so he even knows which rooms have the best dealers. Steve showed us a room with cases full of gold nuggets and gold in quartz matrix. I learned about a new mineral, called electrum, which is a combination of gold and silver. Electrum has an amazing range of formations, including some feathery specimens.

Besides seeing the rocks, we get to talk with people from all over the world. The gold guy is an Aussie, and I could listen to him tell bad jokes all day, just to hear his fabulous accent.

Every February, we're grateful that we live here and don't have to pack our bags, put the cat in a kennel and pay the exorbitant hotel rates to enjoy this phenomenon.

Monday, January 19, 2009

Pima Canyon

Steve and I went for a hike in Pima Canyon yesterday with our friends Garrett and Paul and new friend Sergio. The sky was almost cloudless, and the temperature was perfect. We saw this cristate saguaro. Garrett said it looked like the saguaro was giving us the hang loose hand gesture. How appropriate, as our first Hawai'ian president prepares to take office.