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Unfortunately, many buyers are competing against cash buyers – and losing.  The old saying, “cash is king” is true in this competitive  real estate market.

Recently one of my buyers made an offer on a foreclosed property. Over asking price, very clean, and a desirable offer to any potential seller. However, the buyer lost out to a cash buyer even though the cash buyer offered less. Even the REO agent wanted my buyer to get the home, but has no say!

Why? You ask? Would the bank accept a lower offer? In our market, appraisals are all over the place. As of May 1, in order to “fix” or “remedy” the problem, a new federal Home Valuation Code of Conduct  was placed into effect. No longer are the lenders allowed to speak with the appraisers – nor are they allowed to “choose” the appraisers that will be appraising a home “they” are lending on. Bottom line? It’s a mess!

The left doesn’t know what the right is doing, homes are not appraising, and there are multiple bids on the most desirable homes.

Despite the issues we face, Realtors will continue to push through the paperwork, the difficult appraisals, and we will write two, three, four and more offers in order to get our buyers a home. Ridiculous? Yes!! BUT, this, too, shall pass!

For more insight and understanding about what’s going on, click on the links here and here.

Many buyers that ARE in the market to purchase a home have an unreasonable expectation of what homes cost. They hear all about the “deals” out there for $50,000 $60,000 and up, and are looking at those prices. And they want a four bedroom, pool, three car garage, etc. I’m even hearing such things as “that home is way overpriced!” Really? How does the buyer know that – unless he/she hears that from a friend, or watches the news, or reads the newspaper. How about “asking” the Realtor?

EVEN if the property is overpriced, it won’t appraise! Typically, those low ball prices indicate a beginning price, or the property has major issues. Even up to $100,000 is a questionable number when purchasing a nice home – even in Arizona.

Many are walking away from the short sales. One warning for all of those buyers considering of a short sale, and thinking what a great deal they will get. Yes, SOME may work, but the majority do NOT.

For one example: What if you make an offer on a short sale, and the seller, as most do, has a second on the property? What if the second lender won’t acquiesce on the money owed to them? Then what? I’ll tell you what!! For months you wait – the first finally agrees on a dollar amount -  but the second won’t budge.

The deal falls through. Simple as that. Never mind that the second loses its entire dollar amount owed if the home is foreclosed upon. I was showing a home on Saturday, spoke with the listing agent, and after months of waiting, this exact scenario happened, and the buyers walked.

Consider purchasing from a seller with whom you can negotiate, and who will make those repairs, and provide you with the disclosures and insurance information that is important. On Saturday, last, I showed several homes – one of which was listed by a seller! It was comparable in size and in price – and in STELLAR condition.

Yes, this is a great time to buy a home, but do so wisely. Work with an experienced and knowledgeable Realtor who can advise and counsel you through the process.

In Phoenix and Mesa, Arizona, many/most of the newer communities have a Home Owner Association. That means, for those who don't know, that there are "Covenants, Conditions and Restrictions" governing the community. Buyers when you purchase a home in Phoenix or in Mesa, or in Phoenix Valley, you will be given a copy of the By-Laws and CC&R's for your community. Generally title will mail them to you within ten days of opening escrow.  It would behoove each buyer to actually review and/or read the CC&R's to make sure they are aware of the rules and regulations set forth therein. I'll cite some "for instances" below:

1.  Say, for instance, you the buyer, purchase a home and move into a family community. You have four children, and of course want to install a trampoline (with a net for safety reasons) and a swing set with a fort at the top and a slide, swing, etc. Have you read your CC&R's?

2.  Next, you want to utilize your RV gate, and park an RV trailer, or a boat alongside your home, or even in the back if the lot is large enough. Have you read your CC&R's?

3.  How about this one: You realize you need extra storage in your back yard, so you build a storage shed (which is 6-10 inches above the wall).  Have you read your CC&R's?

4.  Since your children love to play basketball, you install a basketball hoop in the backyard.....again, have you read your CC&R's.

5.  You'd like to paint your home a different color....

I've just cited a few problematic situations. You, the buyer, will quickly learn what the rules of the HOA are when you attempt to do any of the above without getting Board approval. Many times the Board will be able to approve certain requests based on the contents of the CC&Rs.  Keep in mind that the Board did not structure the rules. They are merely serving on the Board to carry out the rules you agreed to when you purchased your new home. As a former member of the Board of Directors in my community, I was privy to all of the behind the scenes' action. Most of the problems could have been resolved before ever being presented to the Board if only the Buyer had read the CC&R's.

The builders and their attorneys are the ones that typically put together the CC&R's - and from what I've seen, they are pretty much boiler plate.....

Learn to work within the boundaries of the CC&R's, and offer to join the Board to help make your community one in which everyone will want to live.

I suspect most of us have heard about the opportunity to obtain a "free" credit report from the three major reporting agencies each year allowing each of us to challenge any negative reporting, and then access our report for seven days after. You will be given a special report number - be sure and write it down - and you will need that in order to access any updates. I had one item on mine that was clearly bogus, and I challenged it as being untrue. I received an updated report that indicated it was removed.

In addition to checking your payment records, etc., it allows you to check the spelling of your name, any addresses that belong to you, and to correct any incorrect information! I cleaned mine up.

I recommend that anyone thinking of purchasing a home take advantage of this annual opportunity. Just recently, I suggested that my daughter check out her credit. It was great! - She wants to purchase a home - hopefully here, so I wanted to get her on board. NO ONE wants to be turned down for any kind of loan. This is just one way to be prepared.

Be sure and sign in and get your free annual credit report here at: Annual Credit Report. Pay attention to the options of paying for any extras. You do not have to - unless, of course you choose to - pay for your FICO score, etc.