Most distressed zip codes are based off of the Cromford Report’s unique “Distress Index” for each zip code in the Greater Phoenix area. The Distress Index is from 0-100, with anything above 40 considered highly distressed. Contact us at 480-331-2832 for the full report.

West Valley

Includes cities such as Avondale, Buckeye, Glendale, Peoria, Surprise, and others.

• 85339 – Distress Index: 86.4 – (see homes)
• 85335 – Distress Index: 84.6 – (see homes)
• 85392 – Distress Index: 81.6 – (see homes)

Phoenix

Immediate Phoenix Metro area.

• 85040 – Distress Index: 82.1 – (see homes)
• 85037 – Distress Index: 82.0 – (see homes)
• 85035 – Distress Index: 81.7 – (see homes)

Southeast Valley

Includes cities such as Chandler, Gilbert, Mesa, Tempe, and others.

• 85224 – Distress Index: 77.3 – (see homes)
• 85225 – Distress Index: 74.6 – (see homes)
• 85204 – Distress Index: 74.5 – (see homes)

Northeast Valley

Includes cities such as Scottsdale, Paradise Valley, and Fountain Hills and others.

• 85257 – Distress Index: 54.7 – (see homes)
• 85254 – Distress Index: 51.0 – (see homes)
• 85250 – Distress Index: 48.2 – (see homes)

Legend Trail and McDowell Mountain Ranch are two gorgeous and affluent communities in the Northeast Valley city of Scottsdale. But as with much of the real estate market in the Phoenix Metro, distressed homes abound. Here are the latest numbers for both these communities and the zip codes they are located in.

McDowell Mountain Ranch Real Estate

Zip code 85255 distressed properties: 36
Zip code 85260 distressed properties: 30
McDowell Mountain Ranch Only: 19 (includes both short sales and bank owned foreclosures)
Click here to see homes

Legend Trail Real Estate

Zip code 85262 distressed properties: 17
Legend Trail Only: 3 (includes both short sales and bank owned foreclosures)
Click here to see homes

How does this compare with other zip codes in the Northeast Valley? If we use the Cromford Report’s “Market Distress Index” we see that both 85255 and 85262 are under the average MDI for the Northeast Valley. While 85260 is slightly over the average MDI.

85326 – See Homes (West Valley)

Trustee Sales: 69
Notice of Foreclosure: 95

85041 – See Homes (Phoenix)

Trustee Sales: 61
Notice of Foreclosure: 90

85379 – See Homes (West Valley)

Trustee Sales: 56
Notice of Foreclosure: 70

85037 – See Homes (Phoenix)

Trustee Sales: 49
Notice of Foreclosure: 93

85033 – See Homes (Phoenix)

Trustee Sales: 48
Notice of Foreclosure: 85

85339 – See Homes (West Valley)

Trustee Sales: 47
Notice of Foreclosure: 84

85338 – See Homes (West Valley)

Trustee Sales: 46
Notice of Foreclosure: 61

85345 – See Homes (West Valley)

Trustee Sales: 44
Notice of Foreclosure: 76

85225 – See Homes (Southeast Valley)

Trustee Sales: 43
Notice of Foreclosure: 63

85308 – See Homes (West Valley)

Trustee Sales: 38
Notice of Foreclosure: 55

85374 – See Homes (West Valley)

Trustee Sales: 37
Notice of Foreclosure: 49

85032 – See Homes (Phoenix)

Trustee Sales: 36
Notice of Foreclosure: 71

85392 – See Homes (West Valley)

Trustee Sales: 36
Notice of Foreclosure: 67

85335 – See Homes (West Valley)

Trustee Sales: 35
Notice of Foreclosure: 70

85353 – See Homes (West Valley)

Trustee Sales: 35
Notice of Foreclosure: 66

85249 – See Homes (Southeast Valley)

Trustee Sales: 35
Notice of Foreclosure: 46

85326 (see homes)

Trustee Sales: 81
Notice of Foreclosure: 81
Average Price per Square Foot (Sales): $44
Median Price: $75,000

85353 (see homes)

Trustee Sales: 62
Notice of Foreclosure: 76
Average Price per Square Foot (Sales): $44
Median Price: $84,000

85335 (see homes)

Trustee Sales: 60
Notice of Foreclosure: 62
Average Price per Square Foot (Sales): $42
Median Price: $65,000

All data is current as of the end of September 2011

Have questions, comments, or want to see more data like this? Call us at 480-331-2832.

85041 (see homes)

Trustee Sales: 73
Notice of Foreclosure: 93
Average Price per Square Foot (Sales): $44
Median Price: $73,000

85037 (see homes)

Trustee Sales: 63
Notice of Foreclosure: 126
Average Price per Square Foot (Sales): $41
Median Price: $65,000

85032 (see homes)

Trustee Sales: 55
Notice of Foreclosure: 85
Average Price per Square Foot (Sales): $79
Median Price: $109,000

All data is current as of the end of September 2011

Have questions, comments, or want to see more data like this? Call us at 480-331-2832.

85207 (see homes)

Trustee Sales: 45
Notice of Foreclosure: 45
Average Price per Square Foot (Sales): $103
Median Price: $115,000

85204 (see homes)

Trustee Sales: 45
Notice of Foreclosure: 41
Average Price per Square Foot (Sales): $58
Median Price: $78,000

85225 (see homes)

Trustee Sales: 43
Notice of Foreclosure: 68
Average Price per Square Foot (Sales): $75
Median Price: $118,000

All data is current as of the end of August 2011

Have questions, comments, or want to see more data like this? Call us at 480-331-2832.

85331 (see homes)

Trustee Sales: 33
Notice of Foreclosure: 31
Average Price per Square Foot (Sales): $124
Median Price: $292,500

85254 (see homes)

Trustee Sales: 29
Notice of Foreclosure: 43
Average Price per Square Foot (Sales): $131
Median Price: $275,000

85255 (see homes)

Trustee Sales: 17
Notice of Foreclosure: 34
Average Price per Square Foot (Sales): $187
Median Price: $544,000

All data is current as of the end of August 2011

Have questions, comments, or want to see more data like this? Call us at 480-331-2832.

The federal government is extending their Emergency Homeowners Loan Program (EHLP) for unemployed and underemployed homeowners who are facing foreclosure. But the $1 billion initiative will expire in two weeks!

The Benefits

• Up to $50,000 in interest-free grants or loans to help pay mortgage bills for up to 24 months
• Homeowners who take advantage don’t have to pay back the money if they keep their home for five years or more

Why the Extension?

Since not enough qualified homeowners applied by the original deadline of July 27th, the U.S. Department of Housing and Urban Development (HUD) has decided to reopen the program and move the deadline to September 15th.

To Qualify

• Formal notification that your lender intends to foreclose because you’ve fallen at least three months behind on your mortgage
• At least a 15 percent drop in income due to involuntary unemployment or underemployment caused by the Great Recession or a medical emergency
• Income that doesn’t exceed the program’s limits
• Recipients must still be able to contribute $150 per month to the mortgage
• Own a home in: Alaska, Arkansas, Colorado, Hawaii, Iowa, Kansas, Louisiana, Maine, Massachusetts, Minnesota, Missouri, Montana, Nebraska, New Hampshire, New Mexico, New York, North Dakota, Oklahoma, South Dakota, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, or the Commonwealth of Puerto Rico

Use It Or Lose It

If not allocated, the money will be returned to the U.S. Treasury so anyone who is eligible should apply now!  Borrowers must contact a housing counselor in the NeighborWorks America network. HUD will then randomly select a number of pre-screened applicants until the EHLP funding is used.  Homeowners can go to FindEHLP.org for more information and to apply.

Similar Programs

• For Arizona: Save Our Home AZ
• For Connecticut, Delaware, Idaho, Maryland, and Pennsylvania: click here (deadline is September 30, 2011)

Some recent statistics I reviewed are pretty telling of the current real estate market and provide some good comparisons of foreclosure and depressed home sales from Spring of last year to Spring of this year.

Foreclosures accounted for about one-third (31%) of all home sales this spring.  Even though that’s a smaller share of sales from the prior quarter, it’s still six times the percentage of foreclosures in a typical housing market.  Moreover, this number would have likely been much larger if not for the investigations of faulty paperwork by banks and mortgage servicers.  This has caused many banks to delay foreclosure sales and once complete we will likely see a flood of foreclosures as the year comes to an end.  In all, 265,087 homes sold in the second quarter were in some stage of foreclosure or owned by banks.  This is a decrease of 11 percent from the same period last year.

Bank-owned homes (which are sold after being repossessed) made up nearly 19 percent of all sales.  This particular statistic was not a change from the previous quarter.  Notably, distressed properties (often in need of repair) typically sell at big discounts and weaken prices for neighboring homes.  One such home sold this spring for 40 percent less than the average price of other homes, up from 36 percent in the previous quarter and 34 percent from the same quarter a year ago.

Sales of homes in the foreclosure process or short sales sold for 21 percent less than the average home which is up from an average of 17 percent in the first quarter and 14 percent in the second quarter of 2010.  A short sale is when the lender agrees to accept less than what is owed on the mortgage.

Prices:  the average sales price of a foreclosure property was $164,217, down less than 1 percent from the January-March quarter and nearly 5 percent from the April-June quarter in 2010.

Nevada led all states with foreclosure sales, accounting for 65 percent of all home sales.  And in Arizona, foreclosure sales represented 57 percent of all home sales for the quarter, up 16 percent from a year ago.

So even though I hear and read differing scenarios on the economy and real estate, it would appear overall that distressed property is still a significant portion of the real estate industry and likely will be so for some time.

Upon a more optimistic outlook for sales, confidence is building among U.S. home builders.  The National Association of Homebuilders (NAHB) reports that builder confidence in the market for newly built, single-family homes rose two points to 15 in July.  Statistics show that the builders group’s index of sales expectations for the rest of 2011 increased from 15 to 22.  This increase in confidence is attributed to buyers taking advantage of favorable buying conditions that are available.  And sales expectations of course play a part, with the outlook being positive for the next six months.

Distressed Properties Backlog

Still, builders are facing many challenges such as a backlog of distressed properties that are still in foreclosure.  You add to that rising unemployment and depressed home values and it would appear that housing may remain one of the weakest parts of the economic recovery.  Notably, the index of buyer traffic held at 12.  Sales for existing homes rose nearly 3 percent in June which is a good thing except for builders, they are gaining the market share from new homes because of increased demand for distressed properties at lower prices.

Stuck at the Bottom?

Still according to David Crowe, the NAHB Chief Economist, “the market continues to bounce along the bottom, with conditions in some locations beginning to improve.”  NAHB Chairman and homebuilder, Bob Nielsen points out, “The improvement in builder confidence in July is a positive sign that the outlook perhaps isn’t quite as bleak as was feared in June.  While builders continue to confront serious challenges with regard to competition from foreclosed properties that are priced below replacement cost, inaccurate appraisals of new homes, and a very restrictive lending environment for new home construction, select markets are showing gradual improvement as consumers begin to take advantage of very favorable buying conditions.”

The builder perception may not be too far off.  If sales are increasing and buyers continue to have such great buying conditions, home builders may just see their market grow in the near future.  It will be an interesting trend to watch as changes take place in the real estate market – with so many houses at such good prices, will buyers demand new builds and if so, how much?  Stay tuned…