Phoenix Real Estate Market Keeps Tanking (Surprise: relocating, pre-approval, gas)

[Captain Bill]

Originally Posted by jdahunt

Our appraisal came in $11,000 less than the owner was asking, we made our offer contingent to the appraisal.

From the comps we saw it was right at about what the appraiser said....the owners realtor said he was very surprise....not sure how with what the comps were showing.

We are going to eat $3,000 of it and the owner the rest....not sure if the realtors gave any back or not.

I think this is probably more common now....so you better be ready to pay some out of pocket if you want to close.

I was surprised how quickly the owner took the house off market once we made our offer, if I was the seller I would have waited a couple of days for more offers.

Whats normal now especially with all the multiple offers, a couple of days at least I would think to allow a biding war.

You're correct about being prepared to pay the difference, especially if it's a short sale because usually the seller doesn't have any money to contribute, or won't.

I've prepared a couple of my buyers to be ready to pay the difference if they're offering over what they feel the house will appraise for.

In your case, if either agent paid a part of the difference it must be disclosed on the HUD-1 that everyone has a copy of. And if they did, they would be idiot agents, in my opinion. Why should an agent use their income to help others buy or sell their home? Doesn't make sense to me.

If a buyer or seller wants to lose a deal over a couple thousand dollars, then my response is, ok, that's your decision so lets move on to the next deal. I'm not helping to pay for anyone's house other than my own.

[jessrscott]

Originally Posted by jdahunt

My post was about how long should one should wait before accepting an offer, in our case it was very quick and the house went off market.

Whats a normal time in this market before a seller has to make a decision....with the multiple offers going on I would think they would want to stretch it out at least a little.

Legally, you have 7 days to accept or counter. However, either party can put a time stipulation in their contract. We are in the process of selling one house and buying another, and that is what our buyers did: they knew we had several showings lined up for that week, so they made an offer that was only valid for 24 hours so that we as the sellers couldn't wait to see what other offers might come in from that week's showings. If there isn't a clause like this in writing with the offer, any offer you make is legally binding for one week. In terms of what the "normal" is or what you "should" do, I'm not a realtor is so I can't speak to that.

Originally Posted by Captain Bill

When there is an executed contract by buyer and seller, the agent is required to change the status to either Pending or AWC (Active With Contingency).

Our realtor told us that we were not obligated to change ours until after the inspection had cleared, even though their contract technically was not contingent upon inspection, they just wanted to have one in order to be informed. A lot of people won't look at a house if they know it is pending or AWC, especially if they are in a time crunch, and we didn't want to lose those people since WE were in a time crunch to sell. But, they scheduled the inspection for a day and a half after we accepted their offer, so maybe that short of a time frame is why we were allowed to do this?

Originally Posted by jdahunt

Our appraisal came in $11,000 less than the owner was asking, we made our offer contingent to the appraisal.

We are going to eat $3,000 of it and the owner the rest....not sure if the realtors gave any back or not.

I think this is probably more common now....so you better be ready to pay some out of pocket if you want to close.

The exact same thing happened to us and we had to walk away from a house we were absolutely in love with, except it was closer to 18k difference between appraisal and asking. The seller didn't have the cash to make up any of the difference and couldn't lower the asking price without crossing over into a short sale. Another symptom of the market bouncing around so much in the last few years, I guess.

[ReadyFreddy]

The exact same thing happened to us and we had to walk away from a house we were absolutely in love with, except it was closer to 18k difference between appraisal and asking. The seller didn't have the cash to make up any of the difference and couldn't lower the asking price without crossing over into a short sale. Another symptom of the market bouncing around so much in the last few years, I guess.

A lot of buyers would pay the $18k out of their own pocket.

Thanks, all, for the reminder what A-WC is. Doh.

My post was about how long should one should wait before accepting an offer, in our case it was very quick and the house went off market.

I'd say your offer was acceptable enough to them. I think they have to grab a buyer when they can or let him go, usually for good (or counteroffer). It'd be nice to say, "Yes, I'll take your offer if a better one doesn't come along in the next two weeks", but I don't know many buyers who will agree to that.

[rjrcm]

Originally Posted by jessrscott

...Our realtor told us that we were not obligated to change ours until after the inspection had cleared, ...

The Arizona Regional MLS requires status to be changed to Pending or AWC within 3 days of executing a purchase contract, no exceptions.

[jdahunt]

I think our realtor really helped us make all of the right moves on this deal....it was her idea to offer the owners full price with the appraisal contingency knowing it was going to appraise low.....she earned every cent of her commission.

A big difference on our deal was that the owner paid off the house and owned it free and clear....so the difference wasn't that big of a deal.

[Potential_Landlord]

How long does it take on average from "AWC" - state to "closed" - state? Is it different for cash purchases or financed ones? - This is for our Phoenix market. Thanks.

[rjrcm]

Originally Posted by Potential_Landlord

How long does it take on average from "AWC" - state to "closed" - state? Is it different for cash purchases or financed ones? - This is for our Phoenix market. Thanks.

It depends on why it's AWC. If it's for a short sale, it could be months, however long it may take for seller bank approval. If it's due to a buyer home sale contingency, then it's typically treated as a normal sale with a typical closing time frame for financed offers of 30-45 days. But they may negotiate a longer time frame to allow for the buyer's sale which may be needed to free up cash for the purchase.

If there is no contingency (Pending and not AWC), then if all cash it can close quickly, usually within a couple weeks depending on time for any inspections or other issues that may need attention.

[Howard Roark]

Case-Shiller is bang on. They are not RE agents so they have no skin in the game.

[autism360]

I think the media didn't read the article because their information is not correct.

The liberal media can never be relied upon to be accurate about anything whether it be real estate or politics because they are not objective,they are biased so they pick and choose what parts of the news they want to display that fit their agenda. Case in point, where are the articles that mention the bidding wars that are a regular occurrence now in the Phoenix area mentioning how buyers need to bring in extra cash at closing to cover the additional costs because the buyers had to pay 10-20K over asking price? The media will find an article that is negative about real estate and put that up in a heartbeat but the positive stuff they have no interest in reporting. Most of the country still thinks that they can waltz into Phoenix and pick up a property for a song and a dance.
There are a few news writers that will tell the truth but the vast majority will not.

[khuntrevor]

I did see a new WFC commercial. It encourages people to actually get real pre-qualification before they house hunt. It seems to infer that a lot of people are missing out on good homes, because sellers aren't fooling around. A letter from some mortgage broker may not carry that much weight.