HAFA is an acronym for Home Affordable Foreclosure Alternatives, a government-sponsored program that helps individuals and families who are experiencing difficulty in selling their homes. In conjunction with the Home Affordable Modification Program (HAMP), HAFA was initiated on November 30, 2009 by the U.S. Treasury Department under the Obama Administration with the goal of revitalizing the housing market.
Via the program, borrowers are provided incentives that will help them take advantage of either a short sale, whereas the borrower and the mortgage servicer agree to sell the home for less than the value of the loan; or a deed-in-lieu of foreclosure, whereas the homeowner voluntarily gives the deed of the property to the servicer.
Here is a great video explanation of HAFA:
In simple terms, HAFA helps people quickly sell their homes by giving them pre-approved short sales terms before listing the property. They are fully released from future liability for the first mortgage debt, and can receive $1,500 for borrower relocation assistance. Investors and servicers can also receive financial assistance through the program for administrative costs, processing fees, etc. Keep in mind the program is actually quite complex with many guidelines and rules.
Although the program was initiated in November 2009, it officially began on Monday, April 5, 2010 and will end on Monday, December 31, 2012. Experts say that if the program is successful, it will likely be extended and the terms may be adjusted for more to qualify.
To apply for the HAFA program homeowners should visit or call their banks to inquire about how they can participate. If you’d like some local lenders to answer your questions shoot me an email and I’ll send your their contact info.
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What’s the Deal?
Cash buyers have come out of the woodwork in Tucson and are snapping up properties left and right. Take a look at the trends over the last five years:
| Total Properties Sold | Cash Deals | Percentage of Market | |
| 2005 | 18,677 | 2,748 | 14.71% |
| 2006 | 16,308 | 2,076 | 12.73% |
| 2007 | 13,403 | 1,796 | 13.40% |
| 2008 | 11,012 | 2,110 | 19.16% |
| 2009 | 12,143 | 2,925 | 24.09% |
| 2010 (YTD) | 8,002 | 2,217 | 27.71% |
And just an FYI, to keep things simple I only included Single Family Residences (SFRs) in these statistics but I”m sure if I included everything else (condos/townhomes/rental properties/land) the trend would be similar; cash buyers are just making moves left and right.
Where Is This Happening?
This trend is not just in Tucson but is occurring all over the US:
Buyers who appear to have used cash to purchase their homes accounted for 46.7 percent of all May sales, down from 48.0 percent in April but up from 42.0 percent a year earlier, based on an analysis of public property records. The median price paid in these seemingly all-cash deals in May was $105,000, down from $112,000 in April but up from $89,250 a year ago.
…
All-cash deals have become popular in many Western markets where prices have dropped sharply, luring investor buyers who can’t always qualify for traditional mortgages. Moreover, sellers favor the relative speed and certainty of all-cash transactions.
Buyers who appeared to have paid all cash – meaning there was no indication that a corresponding purchase loan was recorded – accounted for 27.1 percent of March sales. In February it was a revised 30.0 percent – an all-time high. The 22-year monthly average for Southland homes purchased with cash is 13.8 percent.
With financing still difficult to obtain, all-cash buyers and deep discounts on distressed properties are propping up sales, said Peter Zalewski, a principal at Bal-Harbour-based Condo Vultures.
About 60 percent of South Florida sales have gone to foreign buyers, who are more likely to pay with cash and were never eligible for the tax credit.
So What Does This Mean?
Cash buyers coming out of the woodwork can only be a good sign. It shows people are finally seeing opportunity for investment/growth/return and are willing (and able) to put their cash back into the market.
Any market recovery will start with investors trying to make their money and while the rest of the economy may be sluggish the real estate market will be the first to turn around.
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New Vista and the National Community Stabilization Trust are working together to create a unique opportunity to assist NSP homebuyers and help rebuild the Tucson community. The great part is 35 local area properties will be part of this event and they have all homes have been removed from the market, inspected, repaired, and are ready for purchase by an eligible.
Here are the basic details:
YOUR WAY HOME ARIZONA PROGRAM
Eligible Purchasers May Receive:
- Up to 22% NSP Down Payment Assistance for Buyers
- Current Home Values are between $51,000 – $235,000.
- Seller to pay 3% toward buyer’s closing costs, 2 year Home Warranty and a Refrigerator
- Properties have already been inspected and repaired
- Exclusively for NSP Home Purchaser. They will not be marketed on MLS to the general public.
Please Note the Following Dates:
OPEN HOUSES August 14th and 15th
OFFER DEADLINE August 18th
For more information go to Live the Solution.
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It really does drive me crazy. Why don’t they call up one of the 5,000 agents in Tucson and ask them for concrete statistics and evidence of housing activity in Tucson?
In today’s AZ Daily Star there is an article (South side hit hardest by housing value drop) that has the following graphic:
Year over Year Statistics for Tucson Housing Market
Look I like Zillow.com and the service they provide, but their “Zestimates” and housing statistics in general are never going to be as solid as talking to a local agent who can run actual comparables for you.
If you ever have a question about a home’s value or price trending in a particular area please contact a local agent.
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