Mortgage Bankers Association

Everyone knows that the number of homes on the market is at a record level in almost all communities in the state. But, you know that our population grows at the same price increase for years? So why the excess homes on the market?

The current oversupply is powered by a couple of questions. First, a large number of people inside and outside of Arizona very stingy, when prices started soaring in 2004. (See reference table.) Housessuddenly became a hot commodity instead of places for families to live. Like a bubble of scholarship, the value of a house once guided by what you can sell next month, not what it was worth it as a refuge and a long term investment for a family. This frenzy of buying and selling pushed prices sky high. (excuse the pun.) When this activity has caused prices to reach a ceiling, the whole get-rich-in-real-estate of the public was a large inventory of homes caughtcould not be transformed into a short-term gain. This is a big part of it.

The run up in prices over wages paid. Arizona average income is below the national average of more than 10,000 dollars a year. Suddenly, an average income could not qualify for an average price of the house. Many people already living here or moving in the State have literally been priced out of market. Their net income to support a mortgage to buy a house here.When we look at affordability issues, a family buying a $ 250,000 home needs about $ 35 per hour of gross income to qualify for the resulting mortgage payment. In many societies, a nurse married to a firefighter who has gone lot of money. This fact has left many more unsold homes on the market.

With the government insists that everyone has the inalienable right of a private home (as opposed to an inalienable right to earn a) loan bank mortgage sector continuesto find more imaginative ways to help people in their homes. Many loan programs were simply wrong result for the average man working and bile. The result, several homes off the market because the owner could not really make the mortgage payments you chose. Some of the "stated income" program, which is permitted or invited him / her to lie about how much money he / she is not a good idea and it soon became clear. Both the lender and the borrower is equal tofault in this case. If the borrower lied to get a house he couldn’t afford, he/she deserves the foreclosure on his/her credit. If the bank designed a program that they knew would be abused, they deserve the loss they are going to take on the foreclosure. (adding yet more homes on the market.)

Once the foreclosures started to rise,and Wall Street saw the weakness of these “science fiction” loans,the mortgage banks started returning to sanity in their lending policies. Now we have a situation where more homes than ever on the market and fewer people can qualify to buy. Is not necessarily a bad thing, if not in the short term. If there are too many homes on the market, prices will drop. If banks provide loans to qualified Foreclosures return to normal levels.

In Arizona, we have a very low rate of unemployment, a growing economy, good weather and a fantastic lifestyle. People are still moving here in large numbers. This propertycycle is shown in its correction phase, and will begin shooting very soon. Is this the right time to sell a house? Probably not. Is this a good time to buy? If you have a normal loan qualification, is a good time to buy. Prices are from 2003, but fall far from all time highs in 2005. There is more money available to big prizes to benefit from normal or guidelines are a first time home buyers.