Phoenix area home builders are struggling to sell homes. There has been a 56% drop in New home sales from June 2007 to June 2008 according to R.L. Brown's housing report on the Phoenix area real estate market.

The days of waiting in line to pay a premium for a home from a Phoenix new home builder are a fleeting memory.

However, the competition for fewer and fewer buyers is so fierce that Builder incentives are ever increasing and are tempting many Arizona home buyers.

Builder Incentives include everything from cars, pools, plasma TV's, vacations, upgraded interior fixtures like granite and stainless steel appliances, Green cost saving efforts like solar paneling and financial incentives like no money out of pocket. Some builders offer free pools which can cost as much as a BMW or Lexus

Let me suggest that you look for generous Builder incentives when you make offers and negotiate the purchase of a home from a builder

Do not think, foremost, as your home as an investment. History tells us that over the "long-term' , families do create a nest egg and acquire capital appreciation. However, The key phrase to remember being "long-term".

A house should be a place to live. A place to enjoy. A place to raise a family. A place to meet friends and neighbors. A place to develop roots and community bonds. A place to call home.

Considering today's real estate market and today's prices, you can realize this important part of the American Dream if you buy with the above factors in mind.

If you buy the home you love, in the community you want, at the price you can afford, (Most importantly, the price you can afford) , all of the secondary reasons home ownership is such a foundation and important part of our culture and economic worth.

• Buy your next house as a home, first!
• Plan to live in the home for at least 5 years or more.
• Make sure you can afford a fixed mortgage payment for at least that time.

If history has told us anything, capital appreciation and equity growth should occur nicely for home owners over a long period of time.

In the past there has been some confusion on whether or not,

according to AAR Purchase Contract ..... as it pertains to cash buyers,

Can Cash Buyers ** cancel a contract if the home fails to appraise for the purchase price anytime during the escrow period??

In essence,

does the appraisal for sales price contingency runs the life of the contract??

According to the newsletter this month from AAR, This is NOT TRUE!

"Cash buyers can only cancel a contract within the inspection period, if a home fails to appraise.

Lines 59-61 (of the AAR Purchase Contract) only apply if financing is involved.

I hope this helps! and Good luck to all of you!

Home ownership can be a personally and professionally rewarding endeavor where most Americans can raise a family, call a house a home and create wealth.

However, often  real estate professionals, mortgage brokers,  friends and family will tell you  things like

•  Don't wait, buy now.
•  renting is a waste of money.
• Taking on debt is always o.k.
• real estate prices are going up
• you don't need a down payment

These are not always the right answers.

Ask yourself if you need to have a place to live, enjoy and call home; you will receive tax advantages, a hedge as a safeguard against inflation and build equity as you contribute towards your nest egg.

please speak with your personal and professional advisers before any decisions. However, also remember...

you are the best expert of your own money and personal financial situation. Only you can decided if home ownership is right for you.

I wrote a post 6 months ago called my best ideas for cheaper gas.

I listed a few ideas.  No one listened to my ideas.

I guess a RECESSION would also work !!

1. Gas Tax Cut -  a Gas Tax cut would provide immediate relief. However, people fear a tax cut would just cause more gas consumption.
2. Income tax cut - I would suggest a tax break on the first $75K income. This group is more affected and has less discretionary income and savings. An income tax cut for certain incomes would open more disposable income. The problem with a tax cut is that while effective, it is not immediate. A tax cut has to pass the House, Senate and then a Veto by the President.
3. Increase taxes - spending money on programs for finding alternative energy sources. However, I don't know anyone who likes higher taxes.
4. Open U.S oil reserves - by drilling in places like Alaska -   less dependent on foreign oil - I have read that the US has more than 50 years of untapped Oil reserves.
5. Raise taxes on SUV's , trucks and high use vehicles - Increase incentives for more fuel efficient vehicles.  These are standard in Europe - why not here?
6. Regulate Oil speculation- commodities traders have had an impact on prices betting on future growth - again difficult to control global markets.
7. Increase tax breaks/government benefits to providers of public transportation. Thus, passing on lower costs for commuters.
8. Carpool, Ride a Vespa, bicycle or walk

remember the reasons you are buying a home.

• Is it a place to live? A place to raise your family?
• Are you planning on retiring?
• Do you need the favorable tax advantages?
• Are you looking for a hedge against inflation?
• Are you looking for long-term appreciation?
• A place to live and call home? (I always say this twice)

If you answer ‘yes' to most of the questions above, consider the fact that you can buy real estate and have all of the benefits of home ownership and own your house at a steep discount from the prices of 3 years ago.

Always speak with and consult industry professionals for advice on what is right for you as each situation is unique.

House prices plunged again in October, with the rate of year-over-year decline accelerating to a new record high of 19%.

The peak-to-trough decline in the Case Shiller 10-city index is now 25%; the 20-city index is down 23%.

According to a new report called Cluster stock , " We still occasionally hear folks predicting that the overall house-price decline might be on the order of 20% or so--or maybe 25%, tops. 

Might be time to adjust those forecasts.  Given the current rate of decline and the fact that house prices still have yet to reach their long-term historical average relative to incomes and rents, we remain comfortable with our prediction of a 35%-40% total decline.

Unless the rate of price decline moderates soon, this could even prove conservative.

I am curious what you think?

• are we going lower in housing prices?
• would lower interest rates help ?
• Would you recommend a family member buy?

thanks for sharing

Does that mean we have hit a bottom? Is the end in sight? Is it time to buy??

Inventory levels would indicate that we have some time to go. However, The Federal Reserve Chariman Ben Bernanke appears set to continue to lower interest rates.

Federal lawmakers are committed to work with Government backed lending institutions (Fannie Mae , Freddie Mac ) to stimulate the Real Estate Market and banks are working with consumers to help keep them in their homes.

Don't let the naysayers fool you. If it's not the time, to buy, there is plenty to indicate, at least here in Maricopa County and the cities of Scottsdale to suggest we are very close.

Spec Builds in Inventory -

Discount price - no discount in product or value.

If you can be a little more flexible in all of your specific desires. Many New Home Builders have some home in current Inventory.

Either Buyers could not qualify or the Builder built as "Specs" , homes available for purchase immediately. These homes are often built 70-100% to completion; thus offering a few less choices.

 However, what you lack in choices, is often well made up for in pricing as these builders need to sell them more quickly as they are costly to keep each month.

Short Sales are complicated transactions.

You should work with an experienced short sale listing agent who has been successful with working with banks and asset managers.

A short sale expert can help prepare a detailed short sale approval package that would include

• personal financial information requirements
• BPO (broker price opinion)
• Comparative Market Analysis (CMA),
• work hand in hand with a savvy title company to prepare a net proceeds sheet after cost of sale,
• can inform the seller that there are other possible options prior to a short sale including, loan workout, deed in lieu of foreclosure or foreclosure
• Understand what types of offers the bank is most likely to accept

Please note, there are other options to explore first. If a short sale is your last resort, make sure you seek legal advice first.