Sunday, July 31, 2011

Almost half of mortgages in Arizona are 'underwater,' report says

WASHINGTON - Just under half of all Arizona mortgages were "under water" in spring of this year, the second-highest percentage in the nation, according to a report from a private research firm.

CoreLogic said only Nevada, at 63 percent, had a higher rate of homes under water at the end of the first fiscal quarter of 2011, the most recent period for which it had a report.

An underwater mortgage is a home with negative equity -- when a person owes more on their mortgage than their home is worth.

Arizona homeowners who were under water averaged $60,000 in negative equity, according to the report, below the national average of $65,000. New York borrowers held the highest negative equity with an average of $120,000, but only 6.2 percent of mortgages in that state were under water.

Phoenix was the third-highest metro area in the nation, with 55 percent of its mortgages under water, according to CoreLogic, trailing Las Vegas and Stockton, Calif.

Bankers in Arizona said they sense that foreclosures are starting to slow down, as the market attempts to stabilize.

"We may be bottoming out here," said Paul Hickman, president of the Arizona Association of Bankers.

Large surpluses of housing are still keeping both housing and banking in gridlock. But experts don't believe the situation can get worse than it is right now.

Hickman said the banks are trying to avoid foreclosures, if only to avoid having to pay to maintain them -- a cost that can grow exponentially with about 100,000 foreclosed homes in the state.

"Foreclosures are flattening, they are not putting all that inventory on top of current inventory," Hickman said.

But state housing officials say that requests remain high from people seeking help with their mortgage payments.

"We have been seeing a lot of activity," said Shaun Rieve, spokesman for the Arizona Department of Housing.

Rieve said that the department got more than $267 million from a federal program that targeted states with the biggest losses in the sub-prime mortgage crisis of 2008. The Principal Reduction Program could allocate up to $50,000 toward a homeowner's principal if the lender matched that amount, up to 31 percent of the mortgage, according to the state housing department.

But Rieve said few big lenders came on board with matching funds. He said Bank of America was one of the few to come on board, while the state "can't get Chase (Bank) or Fannie (Mae) and Freddie (Mac)" to sign on.

The department has since redirected $36 million to an unemployment assistance fund that pays up to $2,000 a month in mortgage to unemployed homeowners who meet other requirements. The new program has been far more successful, he said.

Lenders said they are also offering loan modification programs and financial counseling programs to assist borrowers with underwater mortgages.

Chase spokeswoman Mary Jane Rogers said the bank is opening more than 25 new homeownership centers nationally in 2011. The bank already has two centers in Arizona, one in Phoenix and one in Tempe.

She said borrowers can come into these locations six days a week to meet with a Chase adviser to work on alternatives to walking away from their homes.

"We do not want to own people's homes," Rogers said.

by Anthony DeWitt Cronkite News Service Jul. 25, 2011 06:45 PM



Almost half of mortgages in Arizona are 'underwater,' report says

Almost half of mortgages in Arizona are 'underwater,' report says

WASHINGTON - Just under half of all Arizona mortgages were "under water" in spring of this year, the second-highest percentage in the nation, according to a report from a private research firm.

CoreLogic said only Nevada, at 63 percent, had a higher rate of homes under water at the end of the first fiscal quarter of 2011, the most recent period for which it had a report.

An underwater mortgage is a home with negative equity -- when a person owes more on their mortgage than their home is worth.

Arizona homeowners who were under water averaged $60,000 in negative equity, according to the report, below the national average of $65,000. New York borrowers held the highest negative equity with an average of $120,000, but only 6.2 percent of mortgages in that state were under water.

Phoenix was the third-highest metro area in the nation, with 55 percent of its mortgages under water, according to CoreLogic, trailing Las Vegas and Stockton, Calif.

Bankers in Arizona said they sense that foreclosures are starting to slow down, as the market attempts to stabilize.

"We may be bottoming out here," said Paul Hickman, president of the Arizona Association of Bankers.

Large surpluses of housing are still keeping both housing and banking in gridlock. But experts don't believe the situation can get worse than it is right now.

Hickman said the banks are trying to avoid foreclosures, if only to avoid having to pay to maintain them -- a cost that can grow exponentially with about 100,000 foreclosed homes in the state.

"Foreclosures are flattening, they are not putting all that inventory on top of current inventory," Hickman said.

But state housing officials say that requests remain high from people seeking help with their mortgage payments.

"We have been seeing a lot of activity," said Shaun Rieve, spokesman for the Arizona Department of Housing.

Rieve said that the department got more than $267 million from a federal program that targeted states with the biggest losses in the sub-prime mortgage crisis of 2008. The Principal Reduction Program could allocate up to $50,000 toward a homeowner's principal if the lender matched that amount, up to 31 percent of the mortgage, according to the state housing department.

But Rieve said few big lenders came on board with matching funds. He said Bank of America was one of the few to come on board, while the state "can't get Chase (Bank) or Fannie (Mae) and Freddie (Mac)" to sign on.

The department has since redirected $36 million to an unemployment assistance fund that pays up to $2,000 a month in mortgage to unemployed homeowners who meet other requirements. The new program has been far more successful, he said.

Lenders said they are also offering loan modification programs and financial counseling programs to assist borrowers with underwater mortgages.

Chase spokeswoman Mary Jane Rogers said the bank is opening more than 25 new homeownership centers nationally in 2011. The bank already has two centers in Arizona, one in Phoenix and one in Tempe.

She said borrowers can come into these locations six days a week to meet with a Chase adviser to work on alternatives to walking away from their homes.

"We do not want to own people's homes," Rogers said.

by Anthony DeWitt Cronkite News Service Jul. 25, 2011 06:45 PM



Almost half of mortgages in Arizona are 'underwater,' report says

Almost half of mortgages in Arizona are 'underwater,' report says

WASHINGTON - Just under half of all Arizona mortgages were "under water" in spring of this year, the second-highest percentage in the nation, according to a report from a private research firm.

CoreLogic said only Nevada, at 63 percent, had a higher rate of homes under water at the end of the first fiscal quarter of 2011, the most recent period for which it had a report.

An underwater mortgage is a home with negative equity -- when a person owes more on their mortgage than their home is worth.

Arizona homeowners who were under water averaged $60,000 in negative equity, according to the report, below the national average of $65,000. New York borrowers held the highest negative equity with an average of $120,000, but only 6.2 percent of mortgages in that state were under water.

Phoenix was the third-highest metro area in the nation, with 55 percent of its mortgages under water, according to CoreLogic, trailing Las Vegas and Stockton, Calif.

Bankers in Arizona said they sense that foreclosures are starting to slow down, as the market attempts to stabilize.

"We may be bottoming out here," said Paul Hickman, president of the Arizona Association of Bankers.

Large surpluses of housing are still keeping both housing and banking in gridlock. But experts don't believe the situation can get worse than it is right now.

Hickman said the banks are trying to avoid foreclosures, if only to avoid having to pay to maintain them -- a cost that can grow exponentially with about 100,000 foreclosed homes in the state.

"Foreclosures are flattening, they are not putting all that inventory on top of current inventory," Hickman said.

But state housing officials say that requests remain high from people seeking help with their mortgage payments.

"We have been seeing a lot of activity," said Shaun Rieve, spokesman for the Arizona Department of Housing.

Rieve said that the department got more than $267 million from a federal program that targeted states with the biggest losses in the sub-prime mortgage crisis of 2008. The Principal Reduction Program could allocate up to $50,000 toward a homeowner's principal if the lender matched that amount, up to 31 percent of the mortgage, according to the state housing department.

But Rieve said few big lenders came on board with matching funds. He said Bank of America was one of the few to come on board, while the state "can't get Chase (Bank) or Fannie (Mae) and Freddie (Mac)" to sign on.

The department has since redirected $36 million to an unemployment assistance fund that pays up to $2,000 a month in mortgage to unemployed homeowners who meet other requirements. The new program has been far more successful, he said.

Lenders said they are also offering loan modification programs and financial counseling programs to assist borrowers with underwater mortgages.

Chase spokeswoman Mary Jane Rogers said the bank is opening more than 25 new homeownership centers nationally in 2011. The bank already has two centers in Arizona, one in Phoenix and one in Tempe.

She said borrowers can come into these locations six days a week to meet with a Chase adviser to work on alternatives to walking away from their homes.

"We do not want to own people's homes," Rogers said.

by Anthony DeWitt Cronkite News Service Jul. 25, 2011 06:45 PM



Almost half of mortgages in Arizona are 'underwater,' report says

Almost half of mortgages in Arizona are 'underwater,' report says

WASHINGTON - Just under half of all Arizona mortgages were "under water" in spring of this year, the second-highest percentage in the nation, according to a report from a private research firm.

CoreLogic said only Nevada, at 63 percent, had a higher rate of homes under water at the end of the first fiscal quarter of 2011, the most recent period for which it had a report.

An underwater mortgage is a home with negative equity -- when a person owes more on their mortgage than their home is worth.

Arizona homeowners who were under water averaged $60,000 in negative equity, according to the report, below the national average of $65,000. New York borrowers held the highest negative equity with an average of $120,000, but only 6.2 percent of mortgages in that state were under water.

Phoenix was the third-highest metro area in the nation, with 55 percent of its mortgages under water, according to CoreLogic, trailing Las Vegas and Stockton, Calif.

Bankers in Arizona said they sense that foreclosures are starting to slow down, as the market attempts to stabilize.

"We may be bottoming out here," said Paul Hickman, president of the Arizona Association of Bankers.

Large surpluses of housing are still keeping both housing and banking in gridlock. But experts don't believe the situation can get worse than it is right now.

Hickman said the banks are trying to avoid foreclosures, if only to avoid having to pay to maintain them -- a cost that can grow exponentially with about 100,000 foreclosed homes in the state.

"Foreclosures are flattening, they are not putting all that inventory on top of current inventory," Hickman said.

But state housing officials say that requests remain high from people seeking help with their mortgage payments.

"We have been seeing a lot of activity," said Shaun Rieve, spokesman for the Arizona Department of Housing.

Rieve said that the department got more than $267 million from a federal program that targeted states with the biggest losses in the sub-prime mortgage crisis of 2008. The Principal Reduction Program could allocate up to $50,000 toward a homeowner's principal if the lender matched that amount, up to 31 percent of the mortgage, according to the state housing department.

But Rieve said few big lenders came on board with matching funds. He said Bank of America was one of the few to come on board, while the state "can't get Chase (Bank) or Fannie (Mae) and Freddie (Mac)" to sign on.

The department has since redirected $36 million to an unemployment assistance fund that pays up to $2,000 a month in mortgage to unemployed homeowners who meet other requirements. The new program has been far more successful, he said.

Lenders said they are also offering loan modification programs and financial counseling programs to assist borrowers with underwater mortgages.

Chase spokeswoman Mary Jane Rogers said the bank is opening more than 25 new homeownership centers nationally in 2011. The bank already has two centers in Arizona, one in Phoenix and one in Tempe.

She said borrowers can come into these locations six days a week to meet with a Chase adviser to work on alternatives to walking away from their homes.

"We do not want to own people's homes," Rogers said.

by Anthony DeWitt Cronkite News Service Jul. 25, 2011 06:45 PM



Almost half of mortgages in Arizona are 'underwater,' report says

Almost half of mortgages in Arizona are 'underwater,' report says

WASHINGTON - Just under half of all Arizona mortgages were "under water" in spring of this year, the second-highest percentage in the nation, according to a report from a private research firm.

CoreLogic said only Nevada, at 63 percent, had a higher rate of homes under water at the end of the first fiscal quarter of 2011, the most recent period for which it had a report.

An underwater mortgage is a home with negative equity -- when a person owes more on their mortgage than their home is worth.

Arizona homeowners who were under water averaged $60,000 in negative equity, according to the report, below the national average of $65,000. New York borrowers held the highest negative equity with an average of $120,000, but only 6.2 percent of mortgages in that state were under water.

Phoenix was the third-highest metro area in the nation, with 55 percent of its mortgages under water, according to CoreLogic, trailing Las Vegas and Stockton, Calif.

Bankers in Arizona said they sense that foreclosures are starting to slow down, as the market attempts to stabilize.

"We may be bottoming out here," said Paul Hickman, president of the Arizona Association of Bankers.

Large surpluses of housing are still keeping both housing and banking in gridlock. But experts don't believe the situation can get worse than it is right now.

Hickman said the banks are trying to avoid foreclosures, if only to avoid having to pay to maintain them -- a cost that can grow exponentially with about 100,000 foreclosed homes in the state.

"Foreclosures are flattening, they are not putting all that inventory on top of current inventory," Hickman said.

But state housing officials say that requests remain high from people seeking help with their mortgage payments.

"We have been seeing a lot of activity," said Shaun Rieve, spokesman for the Arizona Department of Housing.

Rieve said that the department got more than $267 million from a federal program that targeted states with the biggest losses in the sub-prime mortgage crisis of 2008. The Principal Reduction Program could allocate up to $50,000 toward a homeowner's principal if the lender matched that amount, up to 31 percent of the mortgage, according to the state housing department.

But Rieve said few big lenders came on board with matching funds. He said Bank of America was one of the few to come on board, while the state "can't get Chase (Bank) or Fannie (Mae) and Freddie (Mac)" to sign on.

The department has since redirected $36 million to an unemployment assistance fund that pays up to $2,000 a month in mortgage to unemployed homeowners who meet other requirements. The new program has been far more successful, he said.

Lenders said they are also offering loan modification programs and financial counseling programs to assist borrowers with underwater mortgages.

Chase spokeswoman Mary Jane Rogers said the bank is opening more than 25 new homeownership centers nationally in 2011. The bank already has two centers in Arizona, one in Phoenix and one in Tempe.

She said borrowers can come into these locations six days a week to meet with a Chase adviser to work on alternatives to walking away from their homes.

"We do not want to own people's homes," Rogers said.

by Anthony DeWitt Cronkite News Service Jul. 25, 2011 06:45 PM



Almost half of mortgages in Arizona are 'underwater,' report says

Almost half of mortgages in Arizona are 'underwater,' report says

WASHINGTON - Just under half of all Arizona mortgages were "under water" in spring of this year, the second-highest percentage in the nation, according to a report from a private research firm.

CoreLogic said only Nevada, at 63 percent, had a higher rate of homes under water at the end of the first fiscal quarter of 2011, the most recent period for which it had a report.

An underwater mortgage is a home with negative equity -- when a person owes more on their mortgage than their home is worth.

Arizona homeowners who were under water averaged $60,000 in negative equity, according to the report, below the national average of $65,000. New York borrowers held the highest negative equity with an average of $120,000, but only 6.2 percent of mortgages in that state were under water.

Phoenix was the third-highest metro area in the nation, with 55 percent of its mortgages under water, according to CoreLogic, trailing Las Vegas and Stockton, Calif.

Bankers in Arizona said they sense that foreclosures are starting to slow down, as the market attempts to stabilize.

"We may be bottoming out here," said Paul Hickman, president of the Arizona Association of Bankers.

Large surpluses of housing are still keeping both housing and banking in gridlock. But experts don't believe the situation can get worse than it is right now.

Hickman said the banks are trying to avoid foreclosures, if only to avoid having to pay to maintain them -- a cost that can grow exponentially with about 100,000 foreclosed homes in the state.

"Foreclosures are flattening, they are not putting all that inventory on top of current inventory," Hickman said.

But state housing officials say that requests remain high from people seeking help with their mortgage payments.

"We have been seeing a lot of activity," said Shaun Rieve, spokesman for the Arizona Department of Housing.

Rieve said that the department got more than $267 million from a federal program that targeted states with the biggest losses in the sub-prime mortgage crisis of 2008. The Principal Reduction Program could allocate up to $50,000 toward a homeowner's principal if the lender matched that amount, up to 31 percent of the mortgage, according to the state housing department.

But Rieve said few big lenders came on board with matching funds. He said Bank of America was one of the few to come on board, while the state "can't get Chase (Bank) or Fannie (Mae) and Freddie (Mac)" to sign on.

The department has since redirected $36 million to an unemployment assistance fund that pays up to $2,000 a month in mortgage to unemployed homeowners who meet other requirements. The new program has been far more successful, he said.

Lenders said they are also offering loan modification programs and financial counseling programs to assist borrowers with underwater mortgages.

Chase spokeswoman Mary Jane Rogers said the bank is opening more than 25 new homeownership centers nationally in 2011. The bank already has two centers in Arizona, one in Phoenix and one in Tempe.

She said borrowers can come into these locations six days a week to meet with a Chase adviser to work on alternatives to walking away from their homes.

"We do not want to own people's homes," Rogers said.

by Anthony DeWitt Cronkite News Service Jul. 25, 2011 06:45 PM



Almost half of mortgages in Arizona are 'underwater,' report says

Almost half of mortgages in Arizona are 'underwater,' report says

WASHINGTON - Just under half of all Arizona mortgages were "under water" in spring of this year, the second-highest percentage in the nation, according to a report from a private research firm.

CoreLogic said only Nevada, at 63 percent, had a higher rate of homes under water at the end of the first fiscal quarter of 2011, the most recent period for which it had a report.

An underwater mortgage is a home with negative equity -- when a person owes more on their mortgage than their home is worth.

Arizona homeowners who were under water averaged $60,000 in negative equity, according to the report, below the national average of $65,000. New York borrowers held the highest negative equity with an average of $120,000, but only 6.2 percent of mortgages in that state were under water.

Phoenix was the third-highest metro area in the nation, with 55 percent of its mortgages under water, according to CoreLogic, trailing Las Vegas and Stockton, Calif.

Bankers in Arizona said they sense that foreclosures are starting to slow down, as the market attempts to stabilize.

"We may be bottoming out here," said Paul Hickman, president of the Arizona Association of Bankers.

Large surpluses of housing are still keeping both housing and banking in gridlock. But experts don't believe the situation can get worse than it is right now.

Hickman said the banks are trying to avoid foreclosures, if only to avoid having to pay to maintain them -- a cost that can grow exponentially with about 100,000 foreclosed homes in the state.

"Foreclosures are flattening, they are not putting all that inventory on top of current inventory," Hickman said.

But state housing officials say that requests remain high from people seeking help with their mortgage payments.

"We have been seeing a lot of activity," said Shaun Rieve, spokesman for the Arizona Department of Housing.

Rieve said that the department got more than $267 million from a federal program that targeted states with the biggest losses in the sub-prime mortgage crisis of 2008. The Principal Reduction Program could allocate up to $50,000 toward a homeowner's principal if the lender matched that amount, up to 31 percent of the mortgage, according to the state housing department.

But Rieve said few big lenders came on board with matching funds. He said Bank of America was one of the few to come on board, while the state "can't get Chase (Bank) or Fannie (Mae) and Freddie (Mac)" to sign on.

The department has since redirected $36 million to an unemployment assistance fund that pays up to $2,000 a month in mortgage to unemployed homeowners who meet other requirements. The new program has been far more successful, he said.

Lenders said they are also offering loan modification programs and financial counseling programs to assist borrowers with underwater mortgages.

Chase spokeswoman Mary Jane Rogers said the bank is opening more than 25 new homeownership centers nationally in 2011. The bank already has two centers in Arizona, one in Phoenix and one in Tempe.

She said borrowers can come into these locations six days a week to meet with a Chase adviser to work on alternatives to walking away from their homes.

"We do not want to own people's homes," Rogers said.

by Anthony DeWitt Cronkite News Service Jul. 25, 2011 06:45 PM



Almost half of mortgages in Arizona are 'underwater,' report says

Study: Arizona among worst states for consumer credit

The federal government isn't alone in facing debt challenges.

Arizona ranks as one of the worst states for consumer credit, according to a new study that analyzes five stress factors. The housing bust and a weak job market appear to be prime culprits.

Arizona ranked No. 46 among the 50 states, ahead of only Florida, California, Georgia and last-place Nevada - all epicenters of the housing boom/bust cycle.
http://azcentral.gon.gannettonline.com/apps/pbcs.dll/section?category=HOMES&pub=azcentral

The states with the most creditworthy residents mainly were spread across the Great Plains and upper Midwest, according to the study by CardRatings.com.

"The obvious pattern here is that unemployment tends to drive delinquencies and foreclosures," said Curtis Arnold, founder of Card Ratings.com and author of the study.

Arnold evaluated each of the 50 states across the five categories: average credit scores, foreclosure rates, credit-card delinquencies, bankruptcy rates and unemployment rates.

Arizona had a moderately worse-than-average jobless rate, at No. 35, but was much lower in the other variables, highlighted by the second-worst foreclosure ranking.

"That indicates something else (besides jobs alone) is going on there," Arnold said in an interview.

States with the strongest consumer-credit grades tend to be located where the boom-and-bust real-estate cycle didn't get out of hand.

North Dakota ranked as the state with the highest proportion of creditworthy residents, followed by Vermont, South Dakota, Nebraska and Montana.

These states also tend to have small and fairly homogeneous populations.

A recent Pew Research Center report found that African-Americans, Latinos and even Asian-Americans have seen their net worths decline more sharply than Whites over the past few years. That study cited high Hispanic concentrations in housing-stressed Arizona, California, Florida and Nevada.

Demographics thus could be another factor explaining low-credit profiles in Sunbelt states, though the CardRatings study didn't evaluate that.

One upshot from the study is that everyone in a poor-credit state stands to suffer, not just those with bad credit. This shows up in problems such as weak local banks that can't make loans, foreclosures that push down property values, heightened burdens on municipalities and slower economic growth.

"Even if you have stellar credit, you're not immune," Arnold said. "You are affected by your neighbor's credit."
Impact on cards

As the federal debt-ceiling deadline nears, here's a number to keep in mind: 14.1 percent.

That's the current average advertised interest rate on credit cards tracked by LowCards.com. Many observers have speculated that consumer borrowing costs could rise if the government's debt and budget impasse doesn't get resolved in a constructive way, and credit-card rates could be quick to increase.

"Nearly every credit card on the market today is a variable-rate card," said Bill Hardekopf of LowCards.com.

Most cards are tied to the prime lending rates set by banks, and they would rise if banks push their prime rates higher.

Unlike other rate hikes, which require a 45-day advance notice, that's not the case with increases tied to the prime, Hardekopf explained in a commentary.

"That increase can take place immediately," he said. "But any interest-rate increase will only apply to your future purchases, not your existing balance."

Incidentally, card interest rates are up from an average 11.6 percent tracked by LowCards.com in May 2009, when the government passed sweeping credit-card-reform legislation.
Complaints aplenty

Credit and debt issues ranked No. 2 on a new list of top consumer complaints.

Fraudulent offers to help save homes from foreclosures were among the fastest-growing complaints, according to the study by the Consumer Federation of America and National Association of Consumer Agency Administrators.

Credit/debt complaints trailed only those involving autos that centered around misleading advertising, sales and repair problems and towing disputes.

In the credit/debt area, the study's authors reiterated several reminders for consumers, such as these:

- Consumers can request in writing that debt collectors refrain from calling them.

- For-profit debt-relief and debt-settlement firms can't charge fees until they've obtained a satisfactory settlement.

- Mortgage-relief services can't charge for their help until they provide a written offer to modify a loan that the homeowner has accepted.

by Russ Wiles, columnist The Arizona Republic Jul. 31, 2011 12:00 AM




Study: Arizona among worst states for consumer credit

Study: Arizona among worst states for consumer credit

The federal government isn't alone in facing debt challenges.

Arizona ranks as one of the worst states for consumer credit, according to a new study that analyzes five stress factors. The housing bust and a weak job market appear to be prime culprits.

Arizona ranked No. 46 among the 50 states, ahead of only Florida, California, Georgia and last-place Nevada - all epicenters of the housing boom/bust cycle.
http://azcentral.gon.gannettonline.com/apps/pbcs.dll/section?category=HOMES&pub=azcentral

The states with the most creditworthy residents mainly were spread across the Great Plains and upper Midwest, according to the study by CardRatings.com.

"The obvious pattern here is that unemployment tends to drive delinquencies and foreclosures," said Curtis Arnold, founder of Card Ratings.com and author of the study.

Arnold evaluated each of the 50 states across the five categories: average credit scores, foreclosure rates, credit-card delinquencies, bankruptcy rates and unemployment rates.

Arizona had a moderately worse-than-average jobless rate, at No. 35, but was much lower in the other variables, highlighted by the second-worst foreclosure ranking.

"That indicates something else (besides jobs alone) is going on there," Arnold said in an interview.

States with the strongest consumer-credit grades tend to be located where the boom-and-bust real-estate cycle didn't get out of hand.

North Dakota ranked as the state with the highest proportion of creditworthy residents, followed by Vermont, South Dakota, Nebraska and Montana.

These states also tend to have small and fairly homogeneous populations.

A recent Pew Research Center report found that African-Americans, Latinos and even Asian-Americans have seen their net worths decline more sharply than Whites over the past few years. That study cited high Hispanic concentrations in housing-stressed Arizona, California, Florida and Nevada.

Demographics thus could be another factor explaining low-credit profiles in Sunbelt states, though the CardRatings study didn't evaluate that.

One upshot from the study is that everyone in a poor-credit state stands to suffer, not just those with bad credit. This shows up in problems such as weak local banks that can't make loans, foreclosures that push down property values, heightened burdens on municipalities and slower economic growth.

"Even if you have stellar credit, you're not immune," Arnold said. "You are affected by your neighbor's credit."
Impact on cards

As the federal debt-ceiling deadline nears, here's a number to keep in mind: 14.1 percent.

That's the current average advertised interest rate on credit cards tracked by LowCards.com. Many observers have speculated that consumer borrowing costs could rise if the government's debt and budget impasse doesn't get resolved in a constructive way, and credit-card rates could be quick to increase.

"Nearly every credit card on the market today is a variable-rate card," said Bill Hardekopf of LowCards.com.

Most cards are tied to the prime lending rates set by banks, and they would rise if banks push their prime rates higher.

Unlike other rate hikes, which require a 45-day advance notice, that's not the case with increases tied to the prime, Hardekopf explained in a commentary.

"That increase can take place immediately," he said. "But any interest-rate increase will only apply to your future purchases, not your existing balance."

Incidentally, card interest rates are up from an average 11.6 percent tracked by LowCards.com in May 2009, when the government passed sweeping credit-card-reform legislation.
Complaints aplenty

Credit and debt issues ranked No. 2 on a new list of top consumer complaints.

Fraudulent offers to help save homes from foreclosures were among the fastest-growing complaints, according to the study by the Consumer Federation of America and National Association of Consumer Agency Administrators.

Credit/debt complaints trailed only those involving autos that centered around misleading advertising, sales and repair problems and towing disputes.

In the credit/debt area, the study's authors reiterated several reminders for consumers, such as these:

- Consumers can request in writing that debt collectors refrain from calling them.

- For-profit debt-relief and debt-settlement firms can't charge fees until they've obtained a satisfactory settlement.

- Mortgage-relief services can't charge for their help until they provide a written offer to modify a loan that the homeowner has accepted.

by Russ Wiles, columnist The Arizona Republic Jul. 31, 2011 12:00 AM




Study: Arizona among worst states for consumer credit

Study: Arizona among worst states for consumer credit

The federal government isn't alone in facing debt challenges.

Arizona ranks as one of the worst states for consumer credit, according to a new study that analyzes five stress factors. The housing bust and a weak job market appear to be prime culprits.

Arizona ranked No. 46 among the 50 states, ahead of only Florida, California, Georgia and last-place Nevada - all epicenters of the housing boom/bust cycle.
http://azcentral.gon.gannettonline.com/apps/pbcs.dll/section?category=HOMES&pub=azcentral

The states with the most creditworthy residents mainly were spread across the Great Plains and upper Midwest, according to the study by CardRatings.com.

"The obvious pattern here is that unemployment tends to drive delinquencies and foreclosures," said Curtis Arnold, founder of Card Ratings.com and author of the study.

Arnold evaluated each of the 50 states across the five categories: average credit scores, foreclosure rates, credit-card delinquencies, bankruptcy rates and unemployment rates.

Arizona had a moderately worse-than-average jobless rate, at No. 35, but was much lower in the other variables, highlighted by the second-worst foreclosure ranking.

"That indicates something else (besides jobs alone) is going on there," Arnold said in an interview.

States with the strongest consumer-credit grades tend to be located where the boom-and-bust real-estate cycle didn't get out of hand.

North Dakota ranked as the state with the highest proportion of creditworthy residents, followed by Vermont, South Dakota, Nebraska and Montana.

These states also tend to have small and fairly homogeneous populations.

A recent Pew Research Center report found that African-Americans, Latinos and even Asian-Americans have seen their net worths decline more sharply than Whites over the past few years. That study cited high Hispanic concentrations in housing-stressed Arizona, California, Florida and Nevada.

Demographics thus could be another factor explaining low-credit profiles in Sunbelt states, though the CardRatings study didn't evaluate that.

One upshot from the study is that everyone in a poor-credit state stands to suffer, not just those with bad credit. This shows up in problems such as weak local banks that can't make loans, foreclosures that push down property values, heightened burdens on municipalities and slower economic growth.

"Even if you have stellar credit, you're not immune," Arnold said. "You are affected by your neighbor's credit."
Impact on cards

As the federal debt-ceiling deadline nears, here's a number to keep in mind: 14.1 percent.

That's the current average advertised interest rate on credit cards tracked by LowCards.com. Many observers have speculated that consumer borrowing costs could rise if the government's debt and budget impasse doesn't get resolved in a constructive way, and credit-card rates could be quick to increase.

"Nearly every credit card on the market today is a variable-rate card," said Bill Hardekopf of LowCards.com.

Most cards are tied to the prime lending rates set by banks, and they would rise if banks push their prime rates higher.

Unlike other rate hikes, which require a 45-day advance notice, that's not the case with increases tied to the prime, Hardekopf explained in a commentary.

"That increase can take place immediately," he said. "But any interest-rate increase will only apply to your future purchases, not your existing balance."

Incidentally, card interest rates are up from an average 11.6 percent tracked by LowCards.com in May 2009, when the government passed sweeping credit-card-reform legislation.
Complaints aplenty

Credit and debt issues ranked No. 2 on a new list of top consumer complaints.

Fraudulent offers to help save homes from foreclosures were among the fastest-growing complaints, according to the study by the Consumer Federation of America and National Association of Consumer Agency Administrators.

Credit/debt complaints trailed only those involving autos that centered around misleading advertising, sales and repair problems and towing disputes.

In the credit/debt area, the study's authors reiterated several reminders for consumers, such as these:

- Consumers can request in writing that debt collectors refrain from calling them.

- For-profit debt-relief and debt-settlement firms can't charge fees until they've obtained a satisfactory settlement.

- Mortgage-relief services can't charge for their help until they provide a written offer to modify a loan that the homeowner has accepted.

by Russ Wiles, columnist The Arizona Republic Jul. 31, 2011 12:00 AM




Study: Arizona among worst states for consumer credit

Study: Arizona among worst states for consumer credit

The federal government isn't alone in facing debt challenges.

Arizona ranks as one of the worst states for consumer credit, according to a new study that analyzes five stress factors. The housing bust and a weak job market appear to be prime culprits.

Arizona ranked No. 46 among the 50 states, ahead of only Florida, California, Georgia and last-place Nevada - all epicenters of the housing boom/bust cycle.
http://azcentral.gon.gannettonline.com/apps/pbcs.dll/section?category=HOMES&pub=azcentral

The states with the most creditworthy residents mainly were spread across the Great Plains and upper Midwest, according to the study by CardRatings.com.

"The obvious pattern here is that unemployment tends to drive delinquencies and foreclosures," said Curtis Arnold, founder of Card Ratings.com and author of the study.

Arnold evaluated each of the 50 states across the five categories: average credit scores, foreclosure rates, credit-card delinquencies, bankruptcy rates and unemployment rates.

Arizona had a moderately worse-than-average jobless rate, at No. 35, but was much lower in the other variables, highlighted by the second-worst foreclosure ranking.

"That indicates something else (besides jobs alone) is going on there," Arnold said in an interview.

States with the strongest consumer-credit grades tend to be located where the boom-and-bust real-estate cycle didn't get out of hand.

North Dakota ranked as the state with the highest proportion of creditworthy residents, followed by Vermont, South Dakota, Nebraska and Montana.

These states also tend to have small and fairly homogeneous populations.

A recent Pew Research Center report found that African-Americans, Latinos and even Asian-Americans have seen their net worths decline more sharply than Whites over the past few years. That study cited high Hispanic concentrations in housing-stressed Arizona, California, Florida and Nevada.

Demographics thus could be another factor explaining low-credit profiles in Sunbelt states, though the CardRatings study didn't evaluate that.

One upshot from the study is that everyone in a poor-credit state stands to suffer, not just those with bad credit. This shows up in problems such as weak local banks that can't make loans, foreclosures that push down property values, heightened burdens on municipalities and slower economic growth.

"Even if you have stellar credit, you're not immune," Arnold said. "You are affected by your neighbor's credit."
Impact on cards

As the federal debt-ceiling deadline nears, here's a number to keep in mind: 14.1 percent.

That's the current average advertised interest rate on credit cards tracked by LowCards.com. Many observers have speculated that consumer borrowing costs could rise if the government's debt and budget impasse doesn't get resolved in a constructive way, and credit-card rates could be quick to increase.

"Nearly every credit card on the market today is a variable-rate card," said Bill Hardekopf of LowCards.com.

Most cards are tied to the prime lending rates set by banks, and they would rise if banks push their prime rates higher.

Unlike other rate hikes, which require a 45-day advance notice, that's not the case with increases tied to the prime, Hardekopf explained in a commentary.

"That increase can take place immediately," he said. "But any interest-rate increase will only apply to your future purchases, not your existing balance."

Incidentally, card interest rates are up from an average 11.6 percent tracked by LowCards.com in May 2009, when the government passed sweeping credit-card-reform legislation.
Complaints aplenty

Credit and debt issues ranked No. 2 on a new list of top consumer complaints.

Fraudulent offers to help save homes from foreclosures were among the fastest-growing complaints, according to the study by the Consumer Federation of America and National Association of Consumer Agency Administrators.

Credit/debt complaints trailed only those involving autos that centered around misleading advertising, sales and repair problems and towing disputes.

In the credit/debt area, the study's authors reiterated several reminders for consumers, such as these:

- Consumers can request in writing that debt collectors refrain from calling them.

- For-profit debt-relief and debt-settlement firms can't charge fees until they've obtained a satisfactory settlement.

- Mortgage-relief services can't charge for their help until they provide a written offer to modify a loan that the homeowner has accepted.

by Russ Wiles, columnist The Arizona Republic Jul. 31, 2011 12:00 AM




Study: Arizona among worst states for consumer credit

Study: Arizona among worst states for consumer credit

The federal government isn't alone in facing debt challenges.

Arizona ranks as one of the worst states for consumer credit, according to a new study that analyzes five stress factors. The housing bust and a weak job market appear to be prime culprits.

Arizona ranked No. 46 among the 50 states, ahead of only Florida, California, Georgia and last-place Nevada - all epicenters of the housing boom/bust cycle.
http://azcentral.gon.gannettonline.com/apps/pbcs.dll/section?category=HOMES&pub=azcentral

The states with the most creditworthy residents mainly were spread across the Great Plains and upper Midwest, according to the study by CardRatings.com.

"The obvious pattern here is that unemployment tends to drive delinquencies and foreclosures," said Curtis Arnold, founder of Card Ratings.com and author of the study.

Arnold evaluated each of the 50 states across the five categories: average credit scores, foreclosure rates, credit-card delinquencies, bankruptcy rates and unemployment rates.

Arizona had a moderately worse-than-average jobless rate, at No. 35, but was much lower in the other variables, highlighted by the second-worst foreclosure ranking.

"That indicates something else (besides jobs alone) is going on there," Arnold said in an interview.

States with the strongest consumer-credit grades tend to be located where the boom-and-bust real-estate cycle didn't get out of hand.

North Dakota ranked as the state with the highest proportion of creditworthy residents, followed by Vermont, South Dakota, Nebraska and Montana.

These states also tend to have small and fairly homogeneous populations.

A recent Pew Research Center report found that African-Americans, Latinos and even Asian-Americans have seen their net worths decline more sharply than Whites over the past few years. That study cited high Hispanic concentrations in housing-stressed Arizona, California, Florida and Nevada.

Demographics thus could be another factor explaining low-credit profiles in Sunbelt states, though the CardRatings study didn't evaluate that.

One upshot from the study is that everyone in a poor-credit state stands to suffer, not just those with bad credit. This shows up in problems such as weak local banks that can't make loans, foreclosures that push down property values, heightened burdens on municipalities and slower economic growth.

"Even if you have stellar credit, you're not immune," Arnold said. "You are affected by your neighbor's credit."
Impact on cards

As the federal debt-ceiling deadline nears, here's a number to keep in mind: 14.1 percent.

That's the current average advertised interest rate on credit cards tracked by LowCards.com. Many observers have speculated that consumer borrowing costs could rise if the government's debt and budget impasse doesn't get resolved in a constructive way, and credit-card rates could be quick to increase.

"Nearly every credit card on the market today is a variable-rate card," said Bill Hardekopf of LowCards.com.

Most cards are tied to the prime lending rates set by banks, and they would rise if banks push their prime rates higher.

Unlike other rate hikes, which require a 45-day advance notice, that's not the case with increases tied to the prime, Hardekopf explained in a commentary.

"That increase can take place immediately," he said. "But any interest-rate increase will only apply to your future purchases, not your existing balance."

Incidentally, card interest rates are up from an average 11.6 percent tracked by LowCards.com in May 2009, when the government passed sweeping credit-card-reform legislation.
Complaints aplenty

Credit and debt issues ranked No. 2 on a new list of top consumer complaints.

Fraudulent offers to help save homes from foreclosures were among the fastest-growing complaints, according to the study by the Consumer Federation of America and National Association of Consumer Agency Administrators.

Credit/debt complaints trailed only those involving autos that centered around misleading advertising, sales and repair problems and towing disputes.

In the credit/debt area, the study's authors reiterated several reminders for consumers, such as these:

- Consumers can request in writing that debt collectors refrain from calling them.

- For-profit debt-relief and debt-settlement firms can't charge fees until they've obtained a satisfactory settlement.

- Mortgage-relief services can't charge for their help until they provide a written offer to modify a loan that the homeowner has accepted.

by Russ Wiles, columnist The Arizona Republic Jul. 31, 2011 12:00 AM




Study: Arizona among worst states for consumer credit

Study: Arizona among worst states for consumer credit

The federal government isn't alone in facing debt challenges.

Arizona ranks as one of the worst states for consumer credit, according to a new study that analyzes five stress factors. The housing bust and a weak job market appear to be prime culprits.

Arizona ranked No. 46 among the 50 states, ahead of only Florida, California, Georgia and last-place Nevada - all epicenters of the housing boom/bust cycle.
http://azcentral.gon.gannettonline.com/apps/pbcs.dll/section?category=HOMES&pub=azcentral

The states with the most creditworthy residents mainly were spread across the Great Plains and upper Midwest, according to the study by CardRatings.com.

"The obvious pattern here is that unemployment tends to drive delinquencies and foreclosures," said Curtis Arnold, founder of Card Ratings.com and author of the study.

Arnold evaluated each of the 50 states across the five categories: average credit scores, foreclosure rates, credit-card delinquencies, bankruptcy rates and unemployment rates.

Arizona had a moderately worse-than-average jobless rate, at No. 35, but was much lower in the other variables, highlighted by the second-worst foreclosure ranking.

"That indicates something else (besides jobs alone) is going on there," Arnold said in an interview.

States with the strongest consumer-credit grades tend to be located where the boom-and-bust real-estate cycle didn't get out of hand.

North Dakota ranked as the state with the highest proportion of creditworthy residents, followed by Vermont, South Dakota, Nebraska and Montana.

These states also tend to have small and fairly homogeneous populations.

A recent Pew Research Center report found that African-Americans, Latinos and even Asian-Americans have seen their net worths decline more sharply than Whites over the past few years. That study cited high Hispanic concentrations in housing-stressed Arizona, California, Florida and Nevada.

Demographics thus could be another factor explaining low-credit profiles in Sunbelt states, though the CardRatings study didn't evaluate that.

One upshot from the study is that everyone in a poor-credit state stands to suffer, not just those with bad credit. This shows up in problems such as weak local banks that can't make loans, foreclosures that push down property values, heightened burdens on municipalities and slower economic growth.

"Even if you have stellar credit, you're not immune," Arnold said. "You are affected by your neighbor's credit."
Impact on cards

As the federal debt-ceiling deadline nears, here's a number to keep in mind: 14.1 percent.

That's the current average advertised interest rate on credit cards tracked by LowCards.com. Many observers have speculated that consumer borrowing costs could rise if the government's debt and budget impasse doesn't get resolved in a constructive way, and credit-card rates could be quick to increase.

"Nearly every credit card on the market today is a variable-rate card," said Bill Hardekopf of LowCards.com.

Most cards are tied to the prime lending rates set by banks, and they would rise if banks push their prime rates higher.

Unlike other rate hikes, which require a 45-day advance notice, that's not the case with increases tied to the prime, Hardekopf explained in a commentary.

"That increase can take place immediately," he said. "But any interest-rate increase will only apply to your future purchases, not your existing balance."

Incidentally, card interest rates are up from an average 11.6 percent tracked by LowCards.com in May 2009, when the government passed sweeping credit-card-reform legislation.
Complaints aplenty

Credit and debt issues ranked No. 2 on a new list of top consumer complaints.

Fraudulent offers to help save homes from foreclosures were among the fastest-growing complaints, according to the study by the Consumer Federation of America and National Association of Consumer Agency Administrators.

Credit/debt complaints trailed only those involving autos that centered around misleading advertising, sales and repair problems and towing disputes.

In the credit/debt area, the study's authors reiterated several reminders for consumers, such as these:

- Consumers can request in writing that debt collectors refrain from calling them.

- For-profit debt-relief and debt-settlement firms can't charge fees until they've obtained a satisfactory settlement.

- Mortgage-relief services can't charge for their help until they provide a written offer to modify a loan that the homeowner has accepted.

by Russ Wiles, columnist The Arizona Republic Jul. 31, 2011 12:00 AM




Study: Arizona among worst states for consumer credit

Study: Arizona among worst states for consumer credit

The federal government isn't alone in facing debt challenges.

Arizona ranks as one of the worst states for consumer credit, according to a new study that analyzes five stress factors. The housing bust and a weak job market appear to be prime culprits.

Arizona ranked No. 46 among the 50 states, ahead of only Florida, California, Georgia and last-place Nevada - all epicenters of the housing boom/bust cycle.
http://azcentral.gon.gannettonline.com/apps/pbcs.dll/section?category=HOMES&pub=azcentral

The states with the most creditworthy residents mainly were spread across the Great Plains and upper Midwest, according to the study by CardRatings.com.

"The obvious pattern here is that unemployment tends to drive delinquencies and foreclosures," said Curtis Arnold, founder of Card Ratings.com and author of the study.

Arnold evaluated each of the 50 states across the five categories: average credit scores, foreclosure rates, credit-card delinquencies, bankruptcy rates and unemployment rates.

Arizona had a moderately worse-than-average jobless rate, at No. 35, but was much lower in the other variables, highlighted by the second-worst foreclosure ranking.

"That indicates something else (besides jobs alone) is going on there," Arnold said in an interview.

States with the strongest consumer-credit grades tend to be located where the boom-and-bust real-estate cycle didn't get out of hand.

North Dakota ranked as the state with the highest proportion of creditworthy residents, followed by Vermont, South Dakota, Nebraska and Montana.

These states also tend to have small and fairly homogeneous populations.

A recent Pew Research Center report found that African-Americans, Latinos and even Asian-Americans have seen their net worths decline more sharply than Whites over the past few years. That study cited high Hispanic concentrations in housing-stressed Arizona, California, Florida and Nevada.

Demographics thus could be another factor explaining low-credit profiles in Sunbelt states, though the CardRatings study didn't evaluate that.

One upshot from the study is that everyone in a poor-credit state stands to suffer, not just those with bad credit. This shows up in problems such as weak local banks that can't make loans, foreclosures that push down property values, heightened burdens on municipalities and slower economic growth.

"Even if you have stellar credit, you're not immune," Arnold said. "You are affected by your neighbor's credit."
Impact on cards

As the federal debt-ceiling deadline nears, here's a number to keep in mind: 14.1 percent.

That's the current average advertised interest rate on credit cards tracked by LowCards.com. Many observers have speculated that consumer borrowing costs could rise if the government's debt and budget impasse doesn't get resolved in a constructive way, and credit-card rates could be quick to increase.

"Nearly every credit card on the market today is a variable-rate card," said Bill Hardekopf of LowCards.com.

Most cards are tied to the prime lending rates set by banks, and they would rise if banks push their prime rates higher.

Unlike other rate hikes, which require a 45-day advance notice, that's not the case with increases tied to the prime, Hardekopf explained in a commentary.

"That increase can take place immediately," he said. "But any interest-rate increase will only apply to your future purchases, not your existing balance."

Incidentally, card interest rates are up from an average 11.6 percent tracked by LowCards.com in May 2009, when the government passed sweeping credit-card-reform legislation.
Complaints aplenty

Credit and debt issues ranked No. 2 on a new list of top consumer complaints.

Fraudulent offers to help save homes from foreclosures were among the fastest-growing complaints, according to the study by the Consumer Federation of America and National Association of Consumer Agency Administrators.

Credit/debt complaints trailed only those involving autos that centered around misleading advertising, sales and repair problems and towing disputes.

In the credit/debt area, the study's authors reiterated several reminders for consumers, such as these:

- Consumers can request in writing that debt collectors refrain from calling them.

- For-profit debt-relief and debt-settlement firms can't charge fees until they've obtained a satisfactory settlement.

- Mortgage-relief services can't charge for their help until they provide a written offer to modify a loan that the homeowner has accepted.

by Russ Wiles, columnist The Arizona Republic Jul. 31, 2011 12:00 AM




Study: Arizona among worst states for consumer credit

Real-estate expert sees disconnect in lending

The Phoenix-area commercial real-estate market's problems, which include but are not limited to $3.5 billion of securitized commercial mortgage loans currently in default, are largely the result of that disconnect, he said.

Stapp, still active as a developer, is executive director of the Master of Real Estate Development program at ASU's W. P. Carey School of Business.

He said communities need to get away from relying on massive, corporate lending institutions to fund the development of local real-estate projects. In other words, go back to the way things used to work: local investors funding local development.

Stapp explained the problem this way:

"Real estate is location-specific, unique and small, which makes it really hard to trade and value on a significant scale. Still, the financial world took properties with fundamental differences and bundled them together, in order to create a larger scale, offset transaction costs and trade a bunch of properties together (as commercial mortgage-backed securities)."

Each pool of disparate real-estate assets then was assigned a single investment rating, Stapp said.

"This overlooked the nuances of the individual properties," he said.

Stapp said it's not too late for areas such as metro Phoenix to turn back the clock by setting up local real-estate funds that would finance local development on a project-by-project basis. Everyone involved would benefit, he said, because investors would have more control over where their money was being spent, and developers would know that a project was being financed on its merits, not some financial algorithm devised hundreds of miles away.

by J. Craig Anderson The Arizona Republic Jul. 31, 2011 12:00 AM



Real-estate expert sees disconnect in lending

Real-estate expert sees disconnect in lending

Arizona State University professor and real-estate development veteran Mark Stapp sees a troubling disconnect between local efforts to build sustainable communities and the globalized mechanisms through which those efforts are funded.
The Phoenix-area commercial real-estate market's problems, which include but are not limited to $3.5 billion of securitized commercial mortgage loans currently in default, are largely the result of that disconnect, he said.

Stapp, still active as a developer, is executive director of the Master of Real Estate Development program at ASU's W. P. Carey School of Business.

He said communities need to get away from relying on massive, corporate lending institutions to fund the development of local real-estate projects. In other words, go back to the way things used to work: local investors funding local development.

Stapp explained the problem this way:

"Real estate is location-specific, unique and small, which makes it really hard to trade and value on a significant scale. Still, the financial world took properties with fundamental differences and bundled them together, in order to create a larger scale, offset transaction costs and trade a bunch of properties together (as commercial mortgage-backed securities)."

Each pool of disparate real-estate assets then was assigned a single investment rating, Stapp said.

"This overlooked the nuances of the individual properties," he said.

Stapp said it's not too late for areas such as metro Phoenix to turn back the clock by setting up local real-estate funds that would finance local development on a project-by-project basis. Everyone involved would benefit, he said, because investors would have more control over where their money was being spent, and developers would know that a project was being financed on its merits, not some financial algorithm devised hundreds of miles away.

by J. Craig Anderson The Arizona Republic Jul. 31, 2011 12:00 AM




Real-estate expert sees disconnect in lending

Real-estate expert sees disconnect in lending

Arizona State University professor and real-estate development veteran Mark Stapp sees a troubling disconnect between local efforts to build sustainable communities and the globalized mechanisms through which those efforts are funded.
The Phoenix-area commercial real-estate market's problems, which include but are not limited to $3.5 billion of securitized commercial mortgage loans currently in default, are largely the result of that disconnect, he said.

Stapp, still active as a developer, is executive director of the Master of Real Estate Development program at ASU's W. P. Carey School of Business.

He said communities need to get away from relying on massive, corporate lending institutions to fund the development of local real-estate projects. In other words, go back to the way things used to work: local investors funding local development.

Stapp explained the problem this way:

"Real estate is location-specific, unique and small, which makes it really hard to trade and value on a significant scale. Still, the financial world took properties with fundamental differences and bundled them together, in order to create a larger scale, offset transaction costs and trade a bunch of properties together (as commercial mortgage-backed securities)."

Each pool of disparate real-estate assets then was assigned a single investment rating, Stapp said.

"This overlooked the nuances of the individual properties," he said.

Stapp said it's not too late for areas such as metro Phoenix to turn back the clock by setting up local real-estate funds that would finance local development on a project-by-project basis. Everyone involved would benefit, he said, because investors would have more control over where their money was being spent, and developers would know that a project was being financed on its merits, not some financial algorithm devised hundreds of miles away.

by J. Craig Anderson The Arizona Republic Jul. 31, 2011 12:00 AM




Real-estate expert sees disconnect in lending

Real-estate expert sees disconnect in lending

Arizona State University professor and real-estate development veteran Mark Stapp sees a troubling disconnect between local efforts to build sustainable communities and the globalized mechanisms through which those efforts are funded.
The Phoenix-area commercial real-estate market's problems, which include but are not limited to $3.5 billion of securitized commercial mortgage loans currently in default, are largely the result of that disconnect, he said.

Stapp, still active as a developer, is executive director of the Master of Real Estate Development program at ASU's W. P. Carey School of Business.

He said communities need to get away from relying on massive, corporate lending institutions to fund the development of local real-estate projects. In other words, go back to the way things used to work: local investors funding local development.

Stapp explained the problem this way:

"Real estate is location-specific, unique and small, which makes it really hard to trade and value on a significant scale. Still, the financial world took properties with fundamental differences and bundled them together, in order to create a larger scale, offset transaction costs and trade a bunch of properties together (as commercial mortgage-backed securities)."

Each pool of disparate real-estate assets then was assigned a single investment rating, Stapp said.

"This overlooked the nuances of the individual properties," he said.

Stapp said it's not too late for areas such as metro Phoenix to turn back the clock by setting up local real-estate funds that would finance local development on a project-by-project basis. Everyone involved would benefit, he said, because investors would have more control over where their money was being spent, and developers would know that a project was being financed on its merits, not some financial algorithm devised hundreds of miles away.

by J. Craig Anderson The Arizona Republic Jul. 31, 2011 12:00 AM




Real-estate expert sees disconnect in lending

Real-estate expert sees disconnect in lending

Arizona State University professor and real-estate development veteran Mark Stapp sees a troubling disconnect between local efforts to build sustainable communities and the globalized mechanisms through which those efforts are funded.
The Phoenix-area commercial real-estate market's problems, which include but are not limited to $3.5 billion of securitized commercial mortgage loans currently in default, are largely the result of that disconnect, he said.

Stapp, still active as a developer, is executive director of the Master of Real Estate Development program at ASU's W. P. Carey School of Business.

He said communities need to get away from relying on massive, corporate lending institutions to fund the development of local real-estate projects. In other words, go back to the way things used to work: local investors funding local development.

Stapp explained the problem this way:

"Real estate is location-specific, unique and small, which makes it really hard to trade and value on a significant scale. Still, the financial world took properties with fundamental differences and bundled them together, in order to create a larger scale, offset transaction costs and trade a bunch of properties together (as commercial mortgage-backed securities)."

Each pool of disparate real-estate assets then was assigned a single investment rating, Stapp said.

"This overlooked the nuances of the individual properties," he said.

Stapp said it's not too late for areas such as metro Phoenix to turn back the clock by setting up local real-estate funds that would finance local development on a project-by-project basis. Everyone involved would benefit, he said, because investors would have more control over where their money was being spent, and developers would know that a project was being financed on its merits, not some financial algorithm devised hundreds of miles away.

by J. Craig Anderson The Arizona Republic Jul. 31, 2011 12:00 AM




Real-estate expert sees disconnect in lending

Real-estate expert sees disconnect in lending

Arizona State University professor and real-estate development veteran Mark Stapp sees a troubling disconnect between local efforts to build sustainable communities and the globalized mechanisms through which those efforts are funded.
The Phoenix-area commercial real-estate market's problems, which include but are not limited to $3.5 billion of securitized commercial mortgage loans currently in default, are largely the result of that disconnect, he said.

Stapp, still active as a developer, is executive director of the Master of Real Estate Development program at ASU's W. P. Carey School of Business.

He said communities need to get away from relying on massive, corporate lending institutions to fund the development of local real-estate projects. In other words, go back to the way things used to work: local investors funding local development.

Stapp explained the problem this way:

"Real estate is location-specific, unique and small, which makes it really hard to trade and value on a significant scale. Still, the financial world took properties with fundamental differences and bundled them together, in order to create a larger scale, offset transaction costs and trade a bunch of properties together (as commercial mortgage-backed securities)."

Each pool of disparate real-estate assets then was assigned a single investment rating, Stapp said.

"This overlooked the nuances of the individual properties," he said.

Stapp said it's not too late for areas such as metro Phoenix to turn back the clock by setting up local real-estate funds that would finance local development on a project-by-project basis. Everyone involved would benefit, he said, because investors would have more control over where their money was being spent, and developers would know that a project was being financed on its merits, not some financial algorithm devised hundreds of miles away.

by J. Craig Anderson The Arizona Republic Jul. 31, 2011 12:00 AM




Real-estate expert sees disconnect in lending

Real-estate expert sees disconnect in lending

Arizona State University professor and real-estate development veteran Mark Stapp sees a troubling disconnect between local efforts to build sustainable communities and the globalized mechanisms through which those efforts are funded.
The Phoenix-area commercial real-estate market's problems, which include but are not limited to $3.5 billion of securitized commercial mortgage loans currently in default, are largely the result of that disconnect, he said.

Stapp, still active as a developer, is executive director of the Master of Real Estate Development program at ASU's W. P. Carey School of Business.

He said communities need to get away from relying on massive, corporate lending institutions to fund the development of local real-estate projects. In other words, go back to the way things used to work: local investors funding local development.

Stapp explained the problem this way:

"Real estate is location-specific, unique and small, which makes it really hard to trade and value on a significant scale. Still, the financial world took properties with fundamental differences and bundled them together, in order to create a larger scale, offset transaction costs and trade a bunch of properties together (as commercial mortgage-backed securities)."

Each pool of disparate real-estate assets then was assigned a single investment rating, Stapp said.

"This overlooked the nuances of the individual properties," he said.

Stapp said it's not too late for areas such as metro Phoenix to turn back the clock by setting up local real-estate funds that would finance local development on a project-by-project basis. Everyone involved would benefit, he said, because investors would have more control over where their money was being spent, and developers would know that a project was being financed on its merits, not some financial algorithm devised hundreds of miles away.

by J. Craig Anderson The Arizona Republic Jul. 31, 2011 12:00 AM




Real-estate expert sees disconnect in lending

Phoenix-area homebuilders adjust to market

A deep plunge in both home foreclosures and pre-foreclosure notices in the second quarter ultimately could lead to a boost in business for Phoenix-area homebuilders, who have settled into a slow-but-steady sales pattern during the past two years.

However, builders and analysts said there were several other hurdles to be negotiated before the homebuilding industry could experience anything resembling a recovery.

Those challenges include the inability of many prospective buyers to obtain financing, lack of buyer confidence in the economy's future, a growing shortage of skilled labor in the homebuilding sector and continued stagnation in the Phoenix-area job market.

Executives at locally active builders, including Shea Homes, Taylor Morrison and Robson Communities said they had scaled back costs and are prepared financially to endure the remainder of the foreclosure era.

The builders said they did not expect to see a meaningful increase in sales for at least another year.

Still, they pointed to a number of positive trends that could turn out to be the seeds of a future uptick in new-home sales.

Those trends include the growing number of Baby Boomers reaching retirement age, increased foot traffic at new-home sales offices in the Phoenix area and a mild price recovery under way in the existing-home market.

Maricopa County home foreclosures decreased significantly in the second quarter, shrinking from 15,831 transactions in the second quarter of 2010 to 10,875 transactions, according to Mesa-based real-estate market research firm Ion Data.

Likewise, notices of coming foreclosure decreased from 19,664 notices in the second quarter of 2010 to 13,311 notices, Ion Data analyst Zach Bowers said.

It's not clear whether the lower numbers signify a decrease in unsustainable home loans or mortgage lenders taking a moment to catch their breath, analysts said.

Even if the drop in foreclosures continued, it still would be a long time before area builders felt the positive effects, said Jim Belfiore, a Phoenix-based analyst who covers the homebuilding industry.

"The foreclosure numbers are just so high," said Belfiore, president of Belfiore Real Estate Consulting. "We would need them to go down by 50 percent, and it's just not going to happen overnight.

"We still have 100,000 foreclosures to go, in my opinion."

There were 4,000 new-home permits issued in Maricopa County in the first quarter, down about 10 percent from 4,546 permits during the same period a year earlier, according to the most recent data available from the realty-studies program at Arizona State University's W.P. Carey School of Business.

Home-construction activity remained slow in the second quarter, commensurate with the lower sales volume that builders have experienced, said Pierrette Tierney, vice president of sales and marketing for Scottsdale-based homebuilder Taylor Morrison.

"Permits are down, but it's necessary to balance out the supply-and-demand scale," Tierney said.

Still, Tierney and other builders said sales per subdivision were tracking almost identically with 2010 figures, and that the year-over-year drop in sales is due primarily to the closing out of several subdivisions in 2010.

Belfiore confirmed that assessment, saying that average sales per subdivision in the second quarter was 1.7 homes, exactly what it had been during the same period of 2010.

The consistency of sales per subdivision belies a significant boost in foot traffic inside home-sales offices and model homes, which Belfiore described as both a blessing and a curse.

The good news, he said, was that the average number of potential buying parties per subdivision per week reached its highest level in three years during the second quarter.

The bad news is that as many as half of those interested buyers were denied a mortgage loan, Belfiore said.

"Thirty percent to 50 percent of the people who want a new home don't qualify for financing at this time," he said.

Ed Robson, founder and chairman of Sun Lakes-based Robson Communities, said financing had not been a problem for buyers approaching retirement age, the demographic on which Robson focuses most heavily.

The company's sales have remained steady this year compared with 2010 and are up 16 percent from 2008. Robson said Baby Boomers' lack of confidence in the country's economic future had been the primary factor preventing home sales in the age-restricted market.

Another problem Robson Communities has run into lately is a shortage of skilled labor, he said.

Robson said community rebuilding efforts in regions torn apart by floods or tornadoes have lured away many of the state's best contractors, some of whom were struggling in Arizona due to a lack of steady work.

Still, Robson said there was reason for homebuilders in the "active-adult lifestyle" market to be optimistic.

Their target audience, adults age 45 to 64, has swelled to more than 81 million, compared with just over 31 million in 2000.

Ken Peterson, Arizona vice president of sales and marketing for Walnut, Calif.-based Shea Homes, said recent home sales inside the company's Trilogy active-adult communities had outpaced sales in Shea's family-oriented neighborhoods.

But in general, Peterson said, homebuilders in the age-restricted market were no closer to a boom-era renaissance than those selling to buyers of all ages.

Builders and analysts said the key to surviving the next year or two was not some magic bullet but a constant effort to be more efficient, resourceful and responsive to market changes. Eventually, they believe, things will get better.

Robson, whose Sun Lakes development is one of the largest active-adult communities in the state, said there always will be people who want to buy a home and settle down in Arizona.

"We've got the sun and the weather," he said. "Where else are people going to go?"

by J. Craig Anderson The Arizona Republic Jul. 24, 2011 12:00 AM




Phoenix-area homebuilders adjust to market

Phoenix-area homebuilders adjust to market

A deep plunge in both home foreclosures and pre-foreclosure notices in the second quarter ultimately could lead to a boost in business for Phoenix-area homebuilders, who have settled into a slow-but-steady sales pattern during the past two years.

However, builders and analysts said there were several other hurdles to be negotiated before the homebuilding industry could experience anything resembling a recovery.

Those challenges include the inability of many prospective buyers to obtain financing, lack of buyer confidence in the economy's future, a growing shortage of skilled labor in the homebuilding sector and continued stagnation in the Phoenix-area job market.

Executives at locally active builders, including Shea Homes, Taylor Morrison and Robson Communities said they had scaled back costs and are prepared financially to endure the remainder of the foreclosure era.

The builders said they did not expect to see a meaningful increase in sales for at least another year.

Still, they pointed to a number of positive trends that could turn out to be the seeds of a future uptick in new-home sales.

Those trends include the growing number of Baby Boomers reaching retirement age, increased foot traffic at new-home sales offices in the Phoenix area and a mild price recovery under way in the existing-home market.

Maricopa County home foreclosures decreased significantly in the second quarter, shrinking from 15,831 transactions in the second quarter of 2010 to 10,875 transactions, according to Mesa-based real-estate market research firm Ion Data.

Likewise, notices of coming foreclosure decreased from 19,664 notices in the second quarter of 2010 to 13,311 notices, Ion Data analyst Zach Bowers said.

It's not clear whether the lower numbers signify a decrease in unsustainable home loans or mortgage lenders taking a moment to catch their breath, analysts said.

Even if the drop in foreclosures continued, it still would be a long time before area builders felt the positive effects, said Jim Belfiore, a Phoenix-based analyst who covers the homebuilding industry.

"The foreclosure numbers are just so high," said Belfiore, president of Belfiore Real Estate Consulting. "We would need them to go down by 50 percent, and it's just not going to happen overnight.

"We still have 100,000 foreclosures to go, in my opinion."

There were 4,000 new-home permits issued in Maricopa County in the first quarter, down about 10 percent from 4,546 permits during the same period a year earlier, according to the most recent data available from the realty-studies program at Arizona State University's W.P. Carey School of Business.

Home-construction activity remained slow in the second quarter, commensurate with the lower sales volume that builders have experienced, said Pierrette Tierney, vice president of sales and marketing for Scottsdale-based homebuilder Taylor Morrison.

"Permits are down, but it's necessary to balance out the supply-and-demand scale," Tierney said.

Still, Tierney and other builders said sales per subdivision were tracking almost identically with 2010 figures, and that the year-over-year drop in sales is due primarily to the closing out of several subdivisions in 2010.

Belfiore confirmed that assessment, saying that average sales per subdivision in the second quarter was 1.7 homes, exactly what it had been during the same period of 2010.

The consistency of sales per subdivision belies a significant boost in foot traffic inside home-sales offices and model homes, which Belfiore described as both a blessing and a curse.

The good news, he said, was that the average number of potential buying parties per subdivision per week reached its highest level in three years during the second quarter.

The bad news is that as many as half of those interested buyers were denied a mortgage loan, Belfiore said.

"Thirty percent to 50 percent of the people who want a new home don't qualify for financing at this time," he said.

Ed Robson, founder and chairman of Sun Lakes-based Robson Communities, said financing had not been a problem for buyers approaching retirement age, the demographic on which Robson focuses most heavily.

The company's sales have remained steady this year compared with 2010 and are up 16 percent from 2008. Robson said Baby Boomers' lack of confidence in the country's economic future had been the primary factor preventing home sales in the age-restricted market.

Another problem Robson Communities has run into lately is a shortage of skilled labor, he said.

Robson said community rebuilding efforts in regions torn apart by floods or tornadoes have lured away many of the state's best contractors, some of whom were struggling in Arizona due to a lack of steady work.

Still, Robson said there was reason for homebuilders in the "active-adult lifestyle" market to be optimistic.

Their target audience, adults age 45 to 64, has swelled to more than 81 million, compared with just over 31 million in 2000.

Ken Peterson, Arizona vice president of sales and marketing for Walnut, Calif.-based Shea Homes, said recent home sales inside the company's Trilogy active-adult communities had outpaced sales in Shea's family-oriented neighborhoods.

But in general, Peterson said, homebuilders in the age-restricted market were no closer to a boom-era renaissance than those selling to buyers of all ages.

Builders and analysts said the key to surviving the next year or two was not some magic bullet but a constant effort to be more efficient, resourceful and responsive to market changes. Eventually, they believe, things will get better.

Robson, whose Sun Lakes development is one of the largest active-adult communities in the state, said there always will be people who want to buy a home and settle down in Arizona.

"We've got the sun and the weather," he said. "Where else are people going to go?"

by J. Craig Anderson The Arizona Republic Jul. 24, 2011 12:00 AM




Phoenix-area homebuilders adjust to market

Phoenix-area homebuilders adjust to market

A deep plunge in both home foreclosures and pre-foreclosure notices in the second quarter ultimately could lead to a boost in business for Phoenix-area homebuilders, who have settled into a slow-but-steady sales pattern during the past two years.

However, builders and analysts said there were several other hurdles to be negotiated before the homebuilding industry could experience anything resembling a recovery.

Those challenges include the inability of many prospective buyers to obtain financing, lack of buyer confidence in the economy's future, a growing shortage of skilled labor in the homebuilding sector and continued stagnation in the Phoenix-area job market.

Executives at locally active builders, including Shea Homes, Taylor Morrison and Robson Communities said they had scaled back costs and are prepared financially to endure the remainder of the foreclosure era.

The builders said they did not expect to see a meaningful increase in sales for at least another year.

Still, they pointed to a number of positive trends that could turn out to be the seeds of a future uptick in new-home sales.

Those trends include the growing number of Baby Boomers reaching retirement age, increased foot traffic at new-home sales offices in the Phoenix area and a mild price recovery under way in the existing-home market.

Maricopa County home foreclosures decreased significantly in the second quarter, shrinking from 15,831 transactions in the second quarter of 2010 to 10,875 transactions, according to Mesa-based real-estate market research firm Ion Data.

Likewise, notices of coming foreclosure decreased from 19,664 notices in the second quarter of 2010 to 13,311 notices, Ion Data analyst Zach Bowers said.

It's not clear whether the lower numbers signify a decrease in unsustainable home loans or mortgage lenders taking a moment to catch their breath, analysts said.

Even if the drop in foreclosures continued, it still would be a long time before area builders felt the positive effects, said Jim Belfiore, a Phoenix-based analyst who covers the homebuilding industry.

"The foreclosure numbers are just so high," said Belfiore, president of Belfiore Real Estate Consulting. "We would need them to go down by 50 percent, and it's just not going to happen overnight.

"We still have 100,000 foreclosures to go, in my opinion."

There were 4,000 new-home permits issued in Maricopa County in the first quarter, down about 10 percent from 4,546 permits during the same period a year earlier, according to the most recent data available from the realty-studies program at Arizona State University's W.P. Carey School of Business.

Home-construction activity remained slow in the second quarter, commensurate with the lower sales volume that builders have experienced, said Pierrette Tierney, vice president of sales and marketing for Scottsdale-based homebuilder Taylor Morrison.

"Permits are down, but it's necessary to balance out the supply-and-demand scale," Tierney said.

Still, Tierney and other builders said sales per subdivision were tracking almost identically with 2010 figures, and that the year-over-year drop in sales is due primarily to the closing out of several subdivisions in 2010.

Belfiore confirmed that assessment, saying that average sales per subdivision in the second quarter was 1.7 homes, exactly what it had been during the same period of 2010.

The consistency of sales per subdivision belies a significant boost in foot traffic inside home-sales offices and model homes, which Belfiore described as both a blessing and a curse.

The good news, he said, was that the average number of potential buying parties per subdivision per week reached its highest level in three years during the second quarter.

The bad news is that as many as half of those interested buyers were denied a mortgage loan, Belfiore said.

"Thirty percent to 50 percent of the people who want a new home don't qualify for financing at this time," he said.

Ed Robson, founder and chairman of Sun Lakes-based Robson Communities, said financing had not been a problem for buyers approaching retirement age, the demographic on which Robson focuses most heavily.

The company's sales have remained steady this year compared with 2010 and are up 16 percent from 2008. Robson said Baby Boomers' lack of confidence in the country's economic future had been the primary factor preventing home sales in the age-restricted market.

Another problem Robson Communities has run into lately is a shortage of skilled labor, he said.

Robson said community rebuilding efforts in regions torn apart by floods or tornadoes have lured away many of the state's best contractors, some of whom were struggling in Arizona due to a lack of steady work.

Still, Robson said there was reason for homebuilders in the "active-adult lifestyle" market to be optimistic.

Their target audience, adults age 45 to 64, has swelled to more than 81 million, compared with just over 31 million in 2000.

Ken Peterson, Arizona vice president of sales and marketing for Walnut, Calif.-based Shea Homes, said recent home sales inside the company's Trilogy active-adult communities had outpaced sales in Shea's family-oriented neighborhoods.

But in general, Peterson said, homebuilders in the age-restricted market were no closer to a boom-era renaissance than those selling to buyers of all ages.

Builders and analysts said the key to surviving the next year or two was not some magic bullet but a constant effort to be more efficient, resourceful and responsive to market changes. Eventually, they believe, things will get better.

Robson, whose Sun Lakes development is one of the largest active-adult communities in the state, said there always will be people who want to buy a home and settle down in Arizona.

"We've got the sun and the weather," he said. "Where else are people going to go?"

by J. Craig Anderson The Arizona Republic Jul. 24, 2011 12:00 AM




Phoenix-area homebuilders adjust to market

Phoenix-area homebuilders adjust to market

A deep plunge in both home foreclosures and pre-foreclosure notices in the second quarter ultimately could lead to a boost in business for Phoenix-area homebuilders, who have settled into a slow-but-steady sales pattern during the past two years.

However, builders and analysts said there were several other hurdles to be negotiated before the homebuilding industry could experience anything resembling a recovery.

Those challenges include the inability of many prospective buyers to obtain financing, lack of buyer confidence in the economy's future, a growing shortage of skilled labor in the homebuilding sector and continued stagnation in the Phoenix-area job market.

Executives at locally active builders, including Shea Homes, Taylor Morrison and Robson Communities said they had scaled back costs and are prepared financially to endure the remainder of the foreclosure era.

The builders said they did not expect to see a meaningful increase in sales for at least another year.

Still, they pointed to a number of positive trends that could turn out to be the seeds of a future uptick in new-home sales.

Those trends include the growing number of Baby Boomers reaching retirement age, increased foot traffic at new-home sales offices in the Phoenix area and a mild price recovery under way in the existing-home market.

Maricopa County home foreclosures decreased significantly in the second quarter, shrinking from 15,831 transactions in the second quarter of 2010 to 10,875 transactions, according to Mesa-based real-estate market research firm Ion Data.

Likewise, notices of coming foreclosure decreased from 19,664 notices in the second quarter of 2010 to 13,311 notices, Ion Data analyst Zach Bowers said.

It's not clear whether the lower numbers signify a decrease in unsustainable home loans or mortgage lenders taking a moment to catch their breath, analysts said.

Even if the drop in foreclosures continued, it still would be a long time before area builders felt the positive effects, said Jim Belfiore, a Phoenix-based analyst who covers the homebuilding industry.

"The foreclosure numbers are just so high," said Belfiore, president of Belfiore Real Estate Consulting. "We would need them to go down by 50 percent, and it's just not going to happen overnight.

"We still have 100,000 foreclosures to go, in my opinion."

There were 4,000 new-home permits issued in Maricopa County in the first quarter, down about 10 percent from 4,546 permits during the same period a year earlier, according to the most recent data available from the realty-studies program at Arizona State University's W.P. Carey School of Business.

Home-construction activity remained slow in the second quarter, commensurate with the lower sales volume that builders have experienced, said Pierrette Tierney, vice president of sales and marketing for Scottsdale-based homebuilder Taylor Morrison.

"Permits are down, but it's necessary to balance out the supply-and-demand scale," Tierney said.

Still, Tierney and other builders said sales per subdivision were tracking almost identically with 2010 figures, and that the year-over-year drop in sales is due primarily to the closing out of several subdivisions in 2010.

Belfiore confirmed that assessment, saying that average sales per subdivision in the second quarter was 1.7 homes, exactly what it had been during the same period of 2010.

The consistency of sales per subdivision belies a significant boost in foot traffic inside home-sales offices and model homes, which Belfiore described as both a blessing and a curse.

The good news, he said, was that the average number of potential buying parties per subdivision per week reached its highest level in three years during the second quarter.

The bad news is that as many as half of those interested buyers were denied a mortgage loan, Belfiore said.

"Thirty percent to 50 percent of the people who want a new home don't qualify for financing at this time," he said.

Ed Robson, founder and chairman of Sun Lakes-based Robson Communities, said financing had not been a problem for buyers approaching retirement age, the demographic on which Robson focuses most heavily.

The company's sales have remained steady this year compared with 2010 and are up 16 percent from 2008. Robson said Baby Boomers' lack of confidence in the country's economic future had been the primary factor preventing home sales in the age-restricted market.

Another problem Robson Communities has run into lately is a shortage of skilled labor, he said.

Robson said community rebuilding efforts in regions torn apart by floods or tornadoes have lured away many of the state's best contractors, some of whom were struggling in Arizona due to a lack of steady work.

Still, Robson said there was reason for homebuilders in the "active-adult lifestyle" market to be optimistic.

Their target audience, adults age 45 to 64, has swelled to more than 81 million, compared with just over 31 million in 2000.

Ken Peterson, Arizona vice president of sales and marketing for Walnut, Calif.-based Shea Homes, said recent home sales inside the company's Trilogy active-adult communities had outpaced sales in Shea's family-oriented neighborhoods.

But in general, Peterson said, homebuilders in the age-restricted market were no closer to a boom-era renaissance than those selling to buyers of all ages.

Builders and analysts said the key to surviving the next year or two was not some magic bullet but a constant effort to be more efficient, resourceful and responsive to market changes. Eventually, they believe, things will get better.

Robson, whose Sun Lakes development is one of the largest active-adult communities in the state, said there always will be people who want to buy a home and settle down in Arizona.

"We've got the sun and the weather," he said. "Where else are people going to go?"

by J. Craig Anderson The Arizona Republic Jul. 24, 2011 12:00 AM




Phoenix-area homebuilders adjust to market

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