REALTOR Exclusive: December 12 $2,149,900 4,637 Sq. Ft. Brand New Luxury Home Grand Opening in Heart of Scottsdale!

On December 12, from 11:30 a.m. to 1:30 p.m. join us for a catered lunch at Cachet Home’s Grand Opening of their new luxury home at Fox Haven!

Fletcher R. Wilcox, Grand Canyon Title will make real estate predictions for 2018!

Must RSVP to 480.556.7038.

Address: 10300 N. 79th Way, Scottsdale, 85258

Google Maps is not accurate! Go South of Shea Blvd. on Hayden, take Gold Dust West and turn North on 79th Way.

A Class on Social Influence & the Psychology of Persuasion when Working with Sellers & Buyers

A Class on

Social Influence & the Psychology of Persuasion

 Create influence with buyers & sellers

Turn numbers into knowledge

Turn knowledge into authority

Review social psychology and persuasion

How to get your happy clients to spread the word about you

Get more referral business in 2018!          

JOIN US:

Thursday, November 9th 11:30am to 1:00pm (lunch provided)

LOCATION:

10958 E. TAOS DR, SCOTTSDALE, AZ. 85262

Class will be held in a Luxury Listing Presented by: Yvonne Faustinos, Russ Lyon Sotheby’s International Realty

RSVP:     mailto:FWilcox@gcta.com or 602.648.1230

The Presenter: Fletcher R. Wilcox is V.P. of Business Development and a Real Estate Analyst at Grand Canyon Title. He is founder of The Wilcox Report. His market analysis on the Greater Phoenix residential real estate market has been referenced in the Wall Street Journal, Bloomberg News, MarketWatch, National Mortgage News, Housing Wire.com..and on local and national T.V. Fletcher teaches residential contract writing for renewal hours and served on one of the three Arizona Association of REALTORS subcommittees for the February 2017 AAR Residential Resale Real Estate Purchase Contract.

Sponsors

 

Mathew Kelchner                Ron Peters                                                    Yvonne Faustinos

Suburban Mortgage           Alta Vista Inspection Services                     REALTOR

Branch Manager                 Exclusive 100-Day Inspection Guarantee  Russ Lyon Sotheby’s International Realty

NMLS215995

 

602.758.3459                     480.816.8552                                       480.580.4524

 

 

 

 

West Valley Real Estate Event: Predictions for 2018 & How to Use Market Data With Your Clients & Appraisal Q & A!

          West Valley Real Estate Event  

                                                                                                                         

Wednesday, November 1, 2017 from 10:30 a.m. to 12:00 p.m.

  • Predictions for 2018

  • How to use market data for credibility with your clients

  • 2017 real estate trends for sales, new listings, estimated months of supply

  • Compare home prices today and before the real estate recession

  • What month of the year has the highest sale price?

  • Appraisals and home values

  • What can you say to an appraiser?

  • What have you always wanted to ask an appraiser?

  • How much does solar increase value?

  • Bring your questions

Where: Cachet at the Wigwam

14200 W Village Pkwy #2256 Litchfield Park, AZ 85340

Realtors will tour Cachet’s beautiful single family homes, townhomes and condos.

Lunch served at 12:00 p.m.

RSVP to FWilcox@GCTA.com or 602.648.1230

Speakers

Fletcher R. Wilcox is V.P. of Business Development and a Real Estate Analyst at Grand Canyon Title. He grew up in Phoenix. Graduated from A.S.U. He is author of The Wilcox Report. His market analysis on the Greater Phoenix residential real estate market has been mentioned in the Wall Street Journal, Bloomberg News, MarketWatch, National Mortgage News, Housing Wire.com. Fletcher teaches residential contract writing for renewal hours and served on one of the three Arizona Association of REALTORS subcommittees for the February 2017 AAR Residential Resale Real Estate Purchase Contract.


 

 

 

 

 

 

 

Robert Oglesby is the Founder, President, and Chief Appraiser of AppraisalTek, a full service appraisal company that has established a reputation for providing high-quality appraisal services. Robert supervises all appraisal management operations for multiple large mortgage bankers and his company processes a high volume of appraisals every month. Robert employs and manages full-time employees, including staff appraisers and independent contractors. Robert is a LEED Green Associate, and active certified appraiser. In addition to his work at AppraisalTek, Robert organizes and presents professional seminars for real estate professionals.

     Sponsor

 

 

 

 

 

 

Home Prices Keep Going Up in Greater Phoenix!

It has been a long time since the median sale price for a previously owned single family home was this high.

May 2017 Results  

The median sale price for a previously owned single family home in May was $269,000. The last time the sale price was at the $269,000 level was almost ten years ago.  It was August of 2007.

The data in this report was compiled from the Arizona Regional Multiple Listing Services, Inc.  The geographic area is Greater Phoenix (Maricopa County).

The May 2017 median sale price represented a year-over-year increase of 6.5% or $16,500 compared to May 2016 when it was $252,500. This is a healthy increase.  See Table A.

A Brief History of Median Sale Price

The first time in Maricopa County history that the median sale price of a previously owned single family home reached the May 2017 level was in June 2005. Back then the year-over-year increase was not 6.5% or even close.  It was 47.1% or $86,500.  It went from $183,500 in June 2004 to $270,000 in June 2005.  See Table B.

The May median sale price of $269,000 has come a long way since August 2011 when it bottomed at $120,000. But it still has a little way to go to reach the peak month of $287,500 in June 2006.

Sales in May 2017

May 2017 sales were up 9.5% or by 614 compared to May 2016. Additionally, May 2017 sales were up 13.3% or by 834 over April 2017.  Compare this to May 2016 sales which were up 5.4% or by 332 over April 2016.  See Table C.

New Monthly Listings in May 2017

May 2017 new monthly listings had the highest year-over-year increase for a month this year. There were 466 more listings that hit the market this May than last May.  This jump in inventory most likely will help keep up sales momentum in June and July.

Overall, the number of new monthly listings is flat when comparing the number for the first five months of 2017 to 2016. See total in Table D.

Estimated Months of Supply by Price Point

It is a seller’s market for homes priced under $600,000 (as long as they are priced right). For all price points under $600,000 the estimated months of supply is under four months.  The price range with the highest number of sales was $200,000 to $249,999.  The estimated months of supply in this range was one month.  See Table E.

 

Fletcher R. Wilcox is V.P. of Business Development and a Real Estate Analyst at Grand Canyon Title Agency.
He is author of www.TheWilcoxReport.com. His market analysis on residential real estate in Greater Phoenix has been referenced in the Phoenix Business Journal, the Wall Street Journal, Bloomberg News, MarketWatch, HousingWire.com, National Mortgage News, and the Arizona Republic. He has been a guest speaker on local radio and both local and national TV.
He teaches real estate agents marketing strategies and teaches residential contract writing and Arizona title procedures. He served on one of the subcommittees at the Arizona Association of REALTORS subcommittees making recommendations on changes to the February 2017 AAR Residential Resale Real Estate Purchase Contract. Fletcher started snowboarding in 2006. He is not very good.   Fletcher may be reached at FWilcox@GCTA.com  602.648.1230

Real Estate Agents: Contract law class in beautiful new construction luxury home in Heart of Scottsdale!

 June 22, 9:30 a.m. to 1:00 p.m.

Contract to Closing: Contingencies, Clauses and Cures for three hours of contract law.

Enjoy the class in a brand new luxury home in the Heart of Scottsdale. The home is approximately 4,341 square feet priced at $1,820,000.  Tour the home at 9:30 a.m. and meet the builder.  Class is from 10:00 a.m. to 1:00 p.m.

Fox Haven by Cachet Homes

Class location: 10332 N. 79th Way, Scottsdale, 85258 (Hayden and Gold Dust, just south of Shea Blvd.)

MUST RSVP FWilcox@GCTA.com or 602.648.1230   Cost is ($10.00) dollars.

 

 

 

Class by Internal Dynamics School of Real Estate 13565 N. 102nd Place, Scottsdale 85260  602.363.2960  mbarnewolt@msn.com

 

We will use real life scenarios involving the AAR Residential Resale Real Estate Purchase Contract. 

Scenarios 

Inspection period

BINSR

Seller concessions

Release of earnest money

Risk of loss clause

Contingency clauses versus promise clauses

When do I deliver a cure period notice

Breach of contract

Commitment for title

What is FIRPTA?

There will be a review of the contract timelines 

p.s. I served on one of the subcommittees at the Arizona Association of REALTORS which made the changes to the new contract released February 2017.

Fletcher R. Wilcox  

Contact me to open your next escrow with our Scottsdale office located at 8520 E. Shea Blvd., Suite 115, 85260.

Fletcher R. Wilcox is the author of The Wilcox Report and Vice President of Business Development for Grand Canyon Title. His market analysis has been referenced in the Wall Street Journal, Bloomberg News, HousingWire.com and National Mortgage News. He served on one of Arizona Association of Realtor’s 2017 Residential Resale Contract subcommittees. He may be reached at FWilcox@GCTA.com  or by phone at 602-648-1230.

Recent media appearances

May 17, 2017 in the Phoenix Business Journal  http://www.bizjournals.com/phoenix/news/2017/05/11/existing-home-sales-highest-since-2006-up-18-over.html

May 12, 2017 KTAR    https://ktar.com/story/1570668/maricopa-county-home-sales-up-18-percent-near-prerecession-numbers/

Television interviews

My interview with Gerri Willis on the Fox Business News Network

Interview with Jim Belfiore on Square Off Arizona. Topic: The President and Housing.

Interview on Horizon on housing market.

 

Which buyer costs can a seller concession now pay?

Sixty Days Later: The New AAR Purchase Contract

Published May 2, 2017 in the Arizona Journal of Real Estate & Business

http://www.asreb.com/2017/05/sixty-days-later-the-new-aar-purchase-contract/

 By

Fletcher R. Wilcox
The Wilcox Report

Grand Canyon Title Agency

As I write this article, it is sixty days since the introduction of the new AAR Residential Resale Real Estate Purchase Contract on February 1, 2017. I will review the change in seller concessions, which is a hot topic, and touch on something that recently happened when a seller agreed to pay the initial appraisal fee — and it was to be included in the seller concessions.

The Seller Concessions clause in the new AAR Contract reads:

2J. Seller Concessions (if any): In addition to the other costs Seller has agreed to pay herein, Seller agrees to pay up to ____% of the Purchase Price OR up to $____ to be used only for Buyer’s loan costs, impounds, Title/Escrow Company costs, recording fees, and, if applicable, VA loan costs not permitted to be paid by Buyer.

Much of the discussion on seller concessions centers on the word prepaids which was removed and the addition of the language to be used only for.

Why was prepaids removed from the clause?

In the previous contract the word prepaids was loosely applied. Often when not all of the seller concessions were used after paying for loan costs, impounds, and title/escrow costs any remaining concessions would be used to perhaps prepay additional months of HOA, or maybe prepay pool service, etc. I have heard of seller concessions being applied to pay a buyer’s credit cards and buyer broker commission. While not all sellers may object to these applications, some vehemently did.

Most seller challenges as to what their concessions were to pay happen after receipt of the settlement statement, which is usually just days before a transaction is to close. When a seller and buyer cannot agree on the concessions, an addendum is often needed clarifying what may be paid before the transaction can close.

Since the new contract added the words to be used only for, questions that keep arising is if the lender is required one year of homeowner’s insurance and is the mortgage interest from the close of escrow to the first mortgage payment considered a loan cost? On March 28, 2017 AAR stated, “Both interest and the homeowner’s insurance premiums are costs that the lender requires to be paid as a condition to funding a loan. Thus, those items are considered to be loan costs as that term is used in Section 2j. Accordingly, the interest and homeowner’s insurance premiums would be included in the Seller Concessions as agreed by the parties.”

If there are remaining seller concessions may they be used to prepay items such as additional months of HOA or an additional year of home warranty? Probably not, since neither of these items is a loan cost or a condition to fund the loan.

Additional Seller Concessions are Negotiable
Just as all repairs are negotiable since the seller warranties were removed from the new Contract, the buyer may negotiate additional items that seller concessions may pay. A buyer may want to add language in the Additional Terms and Conditions section of the Contract to read something like this, “Seller concessions to be applied to the following items…”

Initial Appraisal Fee and Seller Concessions
Section 2m lines 111-113 read:

Initial appraisal fee shall be paid by __Buyer __Seller __Other  at the time payment is required by lender and is non-refundable. If Seller is paying the initial appraisal fee, the fee __will __will not be applied against Seller’s Concessions at COE, if applicable.

Recently, a seller agreed to pay the initial appraisal fee of $500 to the lender at the beginning of the transaction. The $500 was to be applied against a seller concession of $4,000.

When the Closing Disclosure was sent to the seller it showed the seller’s concession at COE to be $4,000 instead of reducing it to $3,500, since the seller had already paid $500 for the appraisal.

Apparently, the lenders software was not able to show the seller paying the initial appraisal fee outside of escrow. The Closing Disclosure incorrectly showed that the buyer had paid it outside of escrow. Since the problem was found before closing it was resolved.

Conclusion
Most buyers think that when a seller agreed to give them a concession they will be able to use all of it. They do not understand all the nuances of its application. A buyer may consider adding language to the Contract, and they should discuss with their lender any limitations the lender may have with a seller concession.

 

Fletcher R. Wilcox is the author of The Wilcox Report and Vice President of Business Development for Grand Canyon Title. His market analysis has been referenced in the Wall Street Journal, Bloomberg News, HousingWire.com and National Mortgage News. He served on one of Arizona Association of Realtor’s 2017 Residential Resale Contract subcommittees. He may be reached at FWilcox@GCTA.com  or by phone at 602-648-1230.

Who will be the top real agent, broker and more!

Old Town Scottsdale 2017 Friday Night Industry Party

Awards will be for

  • Residential real estate agent of the year
  • Residential real estate broker of the year
  • Residential rookie agent of the year
  • Residential team of the year
  • Commercial managing principal of the year
  • Commercial real estate broker of the year
  • Home inspector of the year
  • Certified appraiser of the year
  • Escrow officer of the year
  • Title sales representative of the year
  • Mortgage loan originator of the year

Arizona jobs projected to increase by 138,553 and Greater Phoenix jobs by 115,258. More jobs will keep the fire going for already hot housing market.

On March 9, the Arizona Office of Economic Opportunity released job projections.  Jobs in Arizona are projected to increase by 138,553 from the Second Quarter of 2016 through the Second Quarter of 2018.  The majority of the increase in jobs is expected to be in Greater Phoenix.  Jobs in Greater Phoenix are projected to increase by 115,258.  Greater Phoenix in this report is defined as Maricopa and Pinal counties.

This increase in jobs, along with a growing population, will continue to fuel the demand for residential housing.    Greater Phoenix is currently in the midst of a very hot demand for previously owned single family properties in many price ranges.

According to the Arizona Regional Multiple Listing Services, Inc., sales of previously owned single family homes in the first two months of 2017 are fourteen percent higher than for the same period last year.  The number of sales in January and February 2017 were 9,999 compared to 8,777 for the same period last year.

While sales are up inventory is down.  The number of previously owned new monthly listings in January and February 2017 were 5% or 860 less than for the same period last year.

When writing a contract, be prepared for your buyers to compete against multiple offers when a property is priced at market.

Expect prices to go up in many prices ranges.

The majority of the increase in jobs will be in Greater Phoenix 

To read the report go to https://laborstats.az.gov/sites/default/files/documents/files/ST_IndProjReport.pdf

2016-2018 Projected Job Growth by Region
Area Name 2016 Estimated Total Employment Level 2018 Projected Total Employment Level Numeric Growth Annualized Percentage Growth
Arizona 2,852,181 2,990,734 138,553 2.4%
Phoenix MSA1 2,051,434 2,166,692 115,258 2.8%
Tucson MSA2 382,515 392,583 10,068 1.3%
Balance Of State3 414,363 427,176 12,813 1.5%
1) Maricopa and Pinal Counties
2) Pima County 
3) All other areas in Arizona less Maricopa, Pinal, and Pima Counties 

Arizona’s industry employment projections are produced in conjunction with the U.S. Department of Labor (U.S. DOL), Employment and Training Administration (ETA).

Fletcher R. Wilcox is V.P. of Business Development and a Real Estate Analyst at Grand Canyon Title Agency.

He is author of www.TheWilcoxReport.com. His market analysis on residential real estate in Greater Phoenix has been mentioned in the Wall Street Journal, Bloomberg News, MarketWatch, HousingWire.com, National Mortgage News, Arizona Republic and the Phoenix Business Journal. He has been a guest speaker on local radio and both local and national TV.

He teaches real estate agents strategies on marketing and instructs real estate classes in residential contract writing and Arizona title procedures.  Fletcher started snowboarding in 2006. He is not very good.

Fletcher may be reached at mailto:FWilcox@GCTA.com  602.648.1230

Anticipatory Contract Writing

Published in the Arizona REALTOR’s Voice

by Fletcher R. Wilcox on September 9, 2016 

There are 30 blank lines at the beginning of Section 8, Lines 311-340, Additional Terms and Conditions in the AAR Residential Resale Real Estate Purchase Contract (Contract). The purpose of these lines is for the buyer, before presenting an offer to the seller, to put in language that changes, adds to, or subtracts provisions in the body of the Contract.

The key to writing provisions language in the Additional Terms and Conditions section is to do so in clear and understandable terms. Knowledge of the Contract and its timelines is essential in constructing good language.

There are times when a buyer places language into the Additional Terms and Conditions Section in anticipation of situations that may occur in a transaction. The buyer wants the property. Emotions are high. This is when mistakes may be made. In the two scenarios below, a buyer makes the earnest money nonrefundable to present a better offer to the seller. Is the language clear and understandable?

You be the judge.

Scenario One
Language written in the Additional Terms and Conditions section reads, “Earnest money to be nonrefundable after ten day inspection period.”

On day seven after Contract acceptance, the Buyer’s Inspection Notice and Seller’s Response (BINSR) was delivered to the seller giving the seller the opportunity to correct five disapproved items. According to the Contract timeline, the seller then has five days to respond to the buyer. In this situation, the seller responded to the buyer on the fifth day, which was day twelve after contract acceptance. The seller checked the box on the BINSR stating, “Seller is unwilling or unable to correct any of the items disapproved by the Buyer.”

At the beginning of the transaction the buyer was hot for the property. Fifteen days later, upon receiving the seller’s response declining to fix the five requested items, the buyer’s emotions toward the property have cooled. The buyer then canceled the Contract and demanded a return of the earnest money. The seller argued that the buyer can cancel, but the buyer doesn’t get the earnest money, they do. Seller argued the 10 day inspection period ended when the BINSR was delivered and that the buyer canceled after this period. The buyer countered that the 10 day inspection period includes the entire buyer disapproval process in section 6J.

We have an escrow dispute. Is the language written in Section 8 clear and understandable?

Clearer language on behalf of the buyer addressing when the earnest money would be nonrefundable may be, “Buyer’s earnest money shall be nonrefundable unless Buyer elects to cancel pursuant to Section 6J.” Section 6J includes the BINSR timeframes for both buyer and seller responses.

Scenario Two
Language in the Additional Terms and Conditions section reads, “Earnest money to be nonrefundable and released to seller on the twenty first day after contract acceptance.” The buyer wanted 20 days for due diligence and was willing to make the earnest money nonrefundable after this time.

On day 21 after contract acceptance, the seller requested and received the earnest money from the escrow company. Fifteen days later when the close of escrow date came, the transaction did not close and could not close due to an I.R.S. lien attached to the property. For the transaction to close, the seller either had to have the lien paid at close of escrow or obtain a waiver from the I.R.S. The seller was unable to perform either. The buyer delivered a Cure Period Notice to the seller for seller’s failure to close escrow.

On the fourth day after delivery of the Cure Period Notice the seller was in breach, so the buyer canceled the transaction and demanded a return of the earnest money which, according to the language written in Section 8, was now in the seller’s possession.

Will the buyer be able to get the earnest money from the seller? Is the language written in Section 8 clear and understandable?

The buyer and their agent, in making the earnest money nonrefundable and released to the seller, did not anticipate what happens if the seller breaches the Contract. Clearer language on behalf of the buyer may be, “On the twenty first day after contract acceptance, earnest money shall be nonrefundable. However, in the event seller breaches the Contract, buyer is entitled to a return of the earnest money.”

Conclusion
Whether representing a seller or buyer, anticipatory contract writing is first thinking through possible scenarios that might arise based on the market or situation of the buyer, seller or home and addressing those situations with clear and understandable language. This type of writing is enhanced with a strong knowledge of the Contract and its timelines.

This article is not intended as legal advice. Consult your designated broker and legal counsel.


Fletcher WilcoxFletcher R. Wilcox is V.P. of Business Development for Grand Canyon Title Agency. He teaches contract law renewal hours and is author of The Wilcox Report.

Most Misunderstood Parts of the AAR Residential Resale Real Estate Purchase Contract

 

What You Should Know About Loan Contingency & Cure Period Notice

by Fletcher R. Wilcox on July 1, 2016

VP Business Development, Grand Canyon Title Agency

(This article first appeared in Arizona REALTOR® Voice) 

http://blog.aaronline.com/2016/07/what-you-should-know-about-loan-contingency-cure-period-notice/

Since January 2004, more than 1,000,000 transactions listed in ARMLS have closed. Almost every one of them closed using the AAR Residential Resale Real Estate Purchase Contract (the “Contract”). To many agents, the Loan Contingency and Cure Period Notice are some of the most misunderstood parts of the Contract. I often see this when a Contract has cancelled and there is an earnest money dispute.

Loan Contingency
A contingency clause defines a specific event or action that must take place for a contract to become binding. The Loan Contingency in the Contract says that if a buyer is not able to get a loan without Prior to Document (“PTD”) conditions the buyer is not obligated to complete the transaction. PTD conditions mean that loan documents will not be sent out because a lender requirement(s) has not been met by the buyer. Let’s read what the Contract says about the loan contingency.

Loan Contingency
2b. Lines 55-60. Buyer’s obligation to complete this sale is contingent upon Buyer obtaining loan approval for the loan described in the AAR Loan Status Update (“LSU”) form without Prior to Document (“PTD”) conditions no later than three (3) days prior to the COE date…No later than three (3) days prior to the COE Date, Buyer shall…deliver to Seller or Escrow Company notice of inability to obtain loan approval without PTD conditions.

According to the loan contingency language, while the buyer is not obligated to complete the transaction if they cannot get a loan, the buyer did promise to deliver notice that they could not get a loan three days before the close of escrow.

What happens if the buyer cannot get a loan, but breaks their promise and doesn’t deliver notice of inability to get a loan?

The Cure Period Notice
When a party to the Contract breaks a promise and, if there is not language in the Contract specifying what happens next, the remedy then is to deliver a cure period notice to the non-complying party.

“[while] the buyer did promise …the seller also made a promise. They made a promise to deliver a Cure Period Notice to the buyer if the buyer did not deliver notice of their inability to get a loan.

Both parties in the Contract agreed, in Section 7a Lines 278-281 Cure Period, to deliver a Cure Period Notice to the non-complying party. In our example above, not only did the buyer make a promise according to the Contract, but the seller also made a promise. They made a promise to deliver a Cure Period Notice to the buyer if the buyer did not deliver notice of their inability to get a loan.

Once the Cure Period Notice is delivered, the non-complying party has three days to remedy their potential breach. In this case, it means that the buyer shall be entitled to a return of the earnest money if, prior to expiration of the cure period, the buyer delivers notice of inability to obtain loan approval.

Conclusion
Most of the time when you read the word “shall” in the Contract, a promise was made. As a rule, I recommend use of a Cure Period Notice when a promise is broken and the Contract does not have a specific timeline as to what happens next.

While the Loan Contingency in the Contract may result in the buyer getting the earnest money, there are other things to consider in this type of earnest money dispute. Was the buyer unable to get a loan described in the PQF or LSU? What did the loan denial from the lender state as the reason for the denial? Did the buyer have the down payment or other funds necessary to obtain loan approval? Was there a diligent and good faith effort?


Fletcher Wilcox

       Fletcher R. Wilcox is V.P. of Business Development and a Real Estate Analyst

       Grand Canyon Title Agency.

He is author of www.TheWilcoxReport.com. His market analysis on residential real estate in Greater Phoenix has been mentioned in the Wall Street Journal, Bloomberg News, MarketWatch, HousingWire.com, National Mortgage News, Arizona Republic and the Phoenix Business Journal. He has been a guest speaker on local radio and both local and national TV.

He teaches real estate agents strategies on marketing.  He instructs real estate classes in residential contract writing and Arizona title procedures.  Fletcher started snowboarding in 2006. He is not very good.

Fletcher may be reached at FWilcox@GCTA.com  602.648.1230

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