Pinetop White Mountain Blog

Happy New Year Everyone,

I thought today I would do a quick rundown on my observations of the Real Estate market in the White Mountains in 2011.  No, I won't bore you with data or statistics, that is for the experts and bean counters, not hard working Agents like myself who are out there in the real world, listing and selling property.

Overall, 2011 was a fair year in Real Estate.  It started out slow with most of the sales revolving around the Foreclosure market thanks to the banks dumping a bunch of them on the market in January.  Obviously the banking world does not know that the White Mountains climate is considerably different than the climate down in the deserts.  Our winter markets are always slower because so many of our buyers are second home buyers looking for a place to escape the heat of the summer months.  Traffic is always slow during deep winter but picks up again once we start seeing signs of Spring in the low lands. 

By March inquiries starting picking up and we were all quite busy showing property and writing offers, but for the most part our buyers were looking for low priced properties or just getting a feel for the market, and holding back waiting to see if the prices would stabilize or drop more as the summer approached. 

As expected prices did fall a bit, actually this is normal, but not as much as many expected because by midsummer most of the foreclosures were once again out of the market and buyers found that they had waited a little too long to make a move.  They found that they either needed to buy from a conventional seller or give up the idea of buying altogether.  The foreclosure market in this market has never been, nor will it ever be, as dominant as it has been in other places.  Keep in mind, second home buyers usually have stable lives and good incomes so a down turn in the economy won't affect a resort market as much as it does in an area with a year around residency base. 

The market got very busy from August through mid-November with last minute scramblers acquiring their winter/summer getaways in the White Mountains.  About 2/3 of my closings this year, occurred between September 1 & December 31st.   It was a late but very strong fall buying season.   

Lending continues to be a challenge.  Buyers and Sellers alike need to be aware that lenders are underwriting and re-underwriting loans so transactions are taking much longer to complete than they have in the past.  Where we used to feel safe with a 30 to 45 day closing, now most sales are taking 60 days or longer to complete.  Appraisals continue to be an issue because one foreclosure in a neighborhood can drag values for every other property down.  No amount of wishful thinking will change that.  Underwriting standards  are very strict, and lenders are putting a lot of pressure on appraisers to undervalue property to justify their perceptions that all of Arizona is a declining market.   

If you are thinking about buying in 2012 don't let the possibility of a 5% decrease in value stop you.  Interest rates are still at record lows, but with rumors flying about changes proposed in Washington for keeping many of the Social Programs solvent, including Social Security, there are going to be extra fees and higher costs associated with loans for Real Estate.  There will be hidden costs (hidden taxes) included in some of the funding fees for all Government Loans including Fannie Mae & Freddie Mac.  FHA & VA may have much higher Mortgage Insurance Premiums associated with them and down payment requirements on FHA will likely go up.  Conventional Loans will require high down payments or up front fees "points" to buy down interest rates or to lower the down payment requirement. 

The bottom line is, if you are thinking about Buying or Selling in 2012, now is the time to get moving.  No one knows what will happen, even the experts conflict often in their predictions.  What is certain is that it is an election year any changes are going to come early in the year so our elected officials can focus on campaigning for reelection as election day draws closer.  

Personally, I had a good 2011 but I am not sorry to see it end.  I am looking forward to a productive, but no doubt a new year filled with plenty of long hours and very hard work.  I do a great job for my clients though, and in the end, I'll "Get 'ur Done!"

Happy New Year.

Sandra Paulow, Associate Broker, GRI, SFR, REALTOR® 928-242-0300