Investor Confidence Begins to Return to the Arizona Real Estate Market: Download HomeLovers 2010 State of the Industry Report

HomeLovers Arizona 2010 State of the Industry Report Now Available

Glendale, AZ, February 9, 2010 – HomeLovers, one of Arizona's fastest growing Arizona real estate investing and property management companies, today announced availability of its 2010 State of the Industry Report for Arizona Real Estate Investing, which outlines recent trends and takes a look at what lies ahead in 2010 for investors. The report also discusses how the investor of today is different than the investor demographics that lead to the buying frenzy of 2005 and subsequent market crash. The free report is available for download via an automated email response at investorinfo@homelovers.com.

The HomeLovers 2010 State of the Industry Report indicates that by mid 2009, real estate trends in Metropolitan Phoenix showed a marked upswing as investors begin to show confidence in a market recovery. Report participant Michael Orr of The Cromford Report notes that pending home sales in ARMLS (the Arizona Regional Multiple Listing Service) were at a record level for January, indicating an increase in demand with a sales price increase likely to follow. He further noted that buying for the lowest price ranges is cooling off but that buying in the $250,000 - $400,000 range is beginning to increase and showed substantial activity in fourth quarter.

Key Findings in the report include:

•  HomeLovers co-founders and Investing experts David Zundel and Michael Sargent expect a relatively flat market with a shallow upward trend, followed by a gradual return to historical appreciation rates through 2011 and 2012. While there may some swings in pricing, which is normal for a recovering market, there is unlikely to be another major drop and recovery will offset the damage.

•  With homes selling below construction costs, the coming recovery will bring highest returns to those who bought at the bottom of the market.

•  Investors should plan on holding property for a minimum of three-to-five years to leverage improving prices as the market recovers.

•  Short sale transactions are likely to increase over REOs, as banks realize they reduce the loss to the lender. Until the inventory of REO and short sale homes drop to a "normal" level, prices will be held artificially low; however, this investor windfall will fade as the surplus inventory is absorbed.

•  Cash buyers are likely to see the most success in purchasing short sale properties; investors relying on financing and minimal cash down are much less likely to close the sale.

•  Zundel notes that over 80% of the investment properties brought to HomeLovers to manage are homes that they would never have recommended to buyers as a good investment. Investors are making purchases based on price, when there are many other factors that impact whether an investment property is profitable.

•  Tenants are expecting a higher quality of rentals and investors are not doing enough to improve their properties. This has a significant impact on vacancy rates. Fresh paint and carpet cleaning is insufficient.

For more information regarding how to select the right foreclosure property in Arizona, common investor mistakes, tenant screening and more, please visit the articles page on http://www.homelovers.com/ or subscribe to the HomeLovers blog at http://www.arizona-investment-properties.com/.

About HomeLovers
Established in early 2008, HomeLovers is already one of Arizona's most rapidly growing home rental and property management companies. It was founded on the premise of creating a drastically improved property management agency model, including full disclosure of fees and anticipated costs in a market that is prone to "junk fees," unexpected costs and inexperienced agents that make it difficult to manage profitable real estate investment portfolios.

Because of its focus on the development of proprietary tools that assist investors with avoiding purchasing mistakes, maximizing return on their investments and attracting ideal, long-term tenants, HomeLovers was one of the first property management agencies to offer access to real-time online accounting, documentation and reporting.

HomeLovers On Home Page of NuWire Investor

HomeLovers has landed a spot on the home page of http://nuwireinvestor.com/ - with an article on "How to avoid investor pitfalls".

Doin' the happy dance. Whoot, whoot!

Arizona Investor News Over The Weekend

In case you headed out of the office early on Friday and/or didn't keep up with your Phoenix real estate RSS feed over the weekend (subscribe to ours), you might find these local articles interesting.

• Phoenix Business Journal - 8/28: Foreclosure Home Sale Rates Drop As Resales Show Slight Decline
• Arizona Republic - 8/28: Resales Still Robust As Foreclosures Power Buys
• Az Rep Real Estate Reporter Catherine Reagor's blog on azcentral - 8/28: Foreclosure Homes Fall In Phoenix, Are Lenders Holding Onto The Homes?
• East Valley Tribune - 8/28: Flippers Returning To East Valley Housing Market
• ASU's Realty Studies program even released new info on foreclosures - read it here
• Arizona Republic - 8/30: Rentable Housing Numbers Vex Cities

Have a great Monday!

HomeLovers on Twitter

HomeLovers is now on Twitter - tweeting about local Arizona real estate, property management and real estate investor news, and sharing expertise and options.

Follow us at @azhomelovers today!

Arizona Real Estate News Feed

Ever notice the "Google Alerts" box on the right-hand page of our blog? It is an RSS news feed with the latest residential real estate news happening in Arizona.

(What is an RSS feed? Here is a great post explaining it from one of my favorite blogs, ProBlogger by Darren Rowse.)

We monitor breaking news all over the internet for search terms like "Arizona housing", "Arizona foreclosures" and more to be sure we are on top of our market, including both local and national business and trade publications.

We would like to share it with you - just check it out when you read new postings. You can also bookmark the RSS feed page itself to see the full listings, instead of just the five latest headlines.

USA Today - Home sellers frustrated as short sale deals collapse

USA Today recently ran an interesting article on how home sellers are increasingly frustrated as short sale deals collapse - often months into the deal when potential buyers walk away due to lengthy delays. Read the article here.

The author wisely points out that the banks are only part of the problem. Buyers/sellers can’t do much about the banks, but they have total control over the agents they choose.

Now, more than ever, it is critical to choose your experts wisely. Way too often, we see first-time buyers and real estate investors alike being assisted by agents who don’t have enough experience to make the process smooth.

For buyers looking to get a deal on their next personal residence, this will lead to lost deals, frustration and wasted time. Many buyers are putting their moves and future plans into the hands of agents who simply lack the knowledge to get the job done.

For real estate investors, this is an even bigger problem. The inexperienced agents are recommending properties that we would never suggest as an investment. There are great deals out there in virtually every price range, and a short sale can be a great way to get into the perfect property at a nice price. We just caution new homeowners and investors alike to start with the best expert they can find… then shop for the best possible properties… and THEN look for the best deals in the properties they know will work.

If you are going to go through the hassle of a short sale, you want to make sure the home you end up owning is a prize worth winning.

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Today's HomeLovers Press Release

HomeLovers Urges Real Estate Investors to Avoid Major Pitfalls During Current Foreclosure Buying Frenzy

Investors are flocking to purchase sub-$100,000 "bargains" only to learn too late that they aren't good investment properties

Glendale, AZ, July 20, 2009 – HomeLovers, one of Arizona's fastest growing Arizona home rental and property management companies, today announced that second quarter home trends in Metropolitan Phoenix showed a mild upswing. Home prices have started to stabilize and even increase, and banks are becoming more willing to work with buyers. As home inventory begins to shrink and interest rates remain low, the better bargains are getting multiple offers from interested buyers and investors are eagerly snapping up homes - often under the mistaken assumption that every short sale, foreclosed or REO (real estate owned) property is a highly profitable investment opportunity.

Unfortunately, according to HomeLovers, while a home may be a great bargain, it may not be suitable as a rental property. "We are still seeing way too many people apply the right timing and enthusiasm to the wrong property," stated HomeLovers Co-founder David Zundel."Investors are bringing their new steals to us to manage, only to find out that the home they bought has long-term challenges and attracts the wrong types of tenants or is prone to vacancies."

"Over 80% of the homes brought to us for management are the types of homes that we would never have purchased or sold as investments," added Michael Sargent, HomeLovers' other co-founder. "Even the cheapest foreclosure can be a very expensive investment mistake."

Before jumping into what seems like a great opportunity, HomeLovers urges real estate investors to be cautious in avoiding common pitfalls:

1. Do your homework before shopping for a home, so you have a thorough understanding of your long-term plans for the property and the type of tenant you want to attract. It is important to know what your ideal tenant is looking for and the type of property that is most likely to meet their needs. For example, a two-story home in Sun City, Ariz. might lend itself to vacancy issues simply because the senior demographics of the area are adverse to stairs, where a two-story home in Chandler, Ariz. near a park or school may be in high demand because of its younger demographics.

2. Spend time looking at the demographics of the prospective home's neighborhood. Some neighborhoods are simply prone to attract the wrong types of tenants by nature of their affordability. If you are looking at homes renting for under $1,000, understand that you are looking at tenants that typically earn double or triple that - or $24,000 to $36,000 annually. Renters in this income level may struggle with bills and add an unwanted risk factor to your portfolio. The most common mistake, according to HomeLovers, is that investors are scrambling to buy the sub-$100,000 homes. While that might be a great price, there are many more issues that impact a property's profitability, and the advice of a reputable portfolio planner is critical.

3. Don't wait for the bottom of the market. By the time sources confirm the market has hit bottom, prices and interest rates are already on the upswing. Many people tend to sit back and watch before taking action, but if you watch too long, opportunities are missed. The time to buy is now, but it should be done carefully. Investors need to purchase with the long-term returns in mind. With the right tools and/or the expert advice of an experienced property manager, it is easy to crunch the inventory of available properties down to a short list of homes that would make a truly great investment. Once you have a short list, you can shop for the best deal without compromising long-term investment ROI. This strategy will put you ahead of the masses that are getting a great "deal" on bad investments.

4. Consider homes in the $1,000 - $1,500 monthly rental range. This is the "sweet spot" of the market that attracts financially stable, reliable tenants. With all of the foreclosure activity, many people who are used to owning will not be able to buy for a long time. These people make fabulous tenants, and will make a strong pool of tenants for years to come. Until the foreclosed owners get their credit back and start buying homes, we will enjoy a larger group of mid- to high-end tenants. The nicer properties are getting rented faster than ever, and there is a huge demand for middle to upper income homes to rent. Savvy investors need to consider bargains in this area of this market, instead of chasing the homes under $100,000.

For investor information on choosing the right property or choosing the right tenant, please visit HomeLovers' website at http://www.homelovers.com/. HomeLovers also offers a blog focused on property management and investing at http://www.arizona-investment-properties.com/.

About HomeLovers
Established in early 2008, HomeLovers is already one of Arizona's most rapidly growing home rental and property management companies. It was founded on the premise of creating a drastically improved property management agency model, including full disclosure of fees and anticipated costs in a market that is prone to "junk fees," unexpected costs and inexperienced agents that make it difficult to manage profitable real estate investment portfolios.

Because of its focus on the development of proprietary tools that assist investors with avoiding purchasing mistakes, maximizing return on their investments and attracting ideal, long-term tenants, HomeLovers was one of the first property management agencies to offer access to real-time online accounting, documentation and reporting.

Housing Demand Stabilizes

According to Business Week, recent signs point to a stablizing housing market. Read the article here.

What does HomeLover owner and real estate investor Mike Sargent have to say? "Those that wait for the bottom of the market to be obvious are acting too late.

What we are seeing in the Phoenix metropolitan area are investors aggressively moving in to purchase a tremendous number of foreclosure deals. They are coming from Canada and Arizona's surrounding states to eat up the inventory because they are confident the market at rock bottom or close enough to not matter in the long run.

Arizona declined earlier than most housing markets so we are seeing an earlier recovery.

There are bidding wars going on right now similar to the real estate boom in 2005-6; if you want 2 homes for your investment portfolio, you need to bid on 5. The demand for bargains is extremely high.

That being said, just because a home is a bargain does NOT automatically make it a good choice for an investment portfolio. Using a property investment advisor to carefully select the RIGHT "bargain" is critical to the health of your investment portfolio. Don't snap up the best deal until you are certain it is the best investment. "

Click here to read the full article on HomeLovers.com about choosing the right investment property.

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