Jerry Raviol

1640 S. Stapley Dr., #124 • Mesa, AZ 85204
TOLL FREE: 1888-JRAVIOL (572-8465)
CELL: (602) 695-5478
Office: (480) 820-3333
Fax: (480) 907-1443

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West USA Realty

Archive for Mortgage & Finance

How real estate can put cash in your pocket every month.

Everything old is new again –  Back in the days before housing prices zoomed through the roof like a rocket, the way to make money on rentals was to create a positive monthly cash flow, and to count future price appreciation as gravy for a later day when you wanted to sell.  Right now is the first time in years that 4 important factors have aligned so that you can once again both make money every month and build your wealth the old fashioned way –

  1. Low purchase prices – Many homes can be purchased for less than it cost to build them, and sell for 70% less than their market high. 
  2. Crazy low interest rates that you can lock in for 30 years – Today’s rates mean your monthly expenses for principal and interest payments are easily 30% less than a few years ago.  Combine the low interest rate with a low purchase price and your monthly nut can easily be 50% less than in years gone by. 
  3. Stable rent prices – Although rents have fallen, they haven’t fallen by nearly as much as the purchase price of the homes.  This is in part due to the increased number of renters.
  4. A larger pool of renters / increased customer base New mortgage guidelines which make it harder to buy a home + the large number of folks that have lost their homes and need to rent = more renters

Another benefit to a positive cash flow with a one year lease is that it eliminates the need to stress over resale prices every month.  When you are putting cash in your pocket every month, a change in resale prices is less of a concern.  Many of the landlords that got knocked out of the rental business were completely invested in double digit price inflation.  They did not care about the good old fashioned benefits of positive cash flow because they thought they would make it back when they “flipped” it.  When prices went in the wrong direction, and they were sitting on a negative cash flow, all their potential profit was gone. 

I’m buying rentals and I think it is something you should also consider.  Contact me and I’ll be glad to discuss if it makes sense for you to try and get both a monthly return on investment (ROI) combined with future asset appreciation.

Jerry Raviol
West USA Realty

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Home Buyer Tax Credit Extended Until 2011

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YES, you can still get $8,000 in government stimulus money for buying a home if you purchase your home by June 30, 2011.  Congress has acknowledged the unique circumstances affecting members of the military, the Foreign Service, and civilian employees stationed outside the United States for any 90 day period between December 31, 2008 to May 1, 2010. 

As a person who served, this is your opportunity to either buy your first home or move up to a better home and take advantage of the following:

  • Low prices
  • Historic low interest rates
  • Government stimulus money that is no longer available to those who did not serve

These exceptions apply to both the $8,000 tax credit for first-time home buyers and the $6,500 tax credit for repeat home buyers.  They are available until June 30, 2011.

It is important to note that these are TAX CREDITS.  For example, if  before you bought a home you were entitled to a $2,000 tax refund, then after buying a home if you qualified for the first time home buyer tax credit, you would qualify for an additional $8,000.   In this situation your tax refund would increase to $10,000.

If you qualify and have owned a home during the last 5 years but want to move up to a better home you can get $6,500. Each person’s situation is different and you need to speak to a tax expert. 

If, however, you want a list of homes you can buy and get $8,000 from the government give me a call.

Jerry Raviol
West USA Realty

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Own For Less Than Rent in Arizona

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Learn more about owning a home for less than you are paying in rent. Watch the video below and visit

Jerry Raviol
West USA Realty

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Homebuilders are buying land again in metropolitan Phoenix.

So far this year, according to the Arizona brokerage firm Land Advisors, homebuilders here have spent $90 million on land purchases for new homes. That’s the most builders have invested in the region’s land in any year since the peak of the housing boom in 2006.

New land purchases are a sign the cycle is stirring to life again in a retooled housing industry.

The parcels of land and the pool of builders buying them are both much smaller than before the real- estate crash. But residential lot prices are climbing as a steady stream of purchases by builders the past six months restarts the region’s new-home industry.

Home building had a predictable pattern in the Phoenix area prior to the 2007 housing-market crash. Builders bought lots in the newest edge communities, built and sold homes and then bought more lots. Big builders bought land years ahead of construction.

The crash disrupted that pattern and left builders with unsold homes and vacant lots. Houses and lots were sold off at sale prices. Some builders lost large parcels of land to foreclosure. Other builders slid into bankruptcy or simply closed. Home building slowed to levels not seen since the 1970s.

Builders who survived the crash have cut operating and building costs and are trying to eke out smaller profits on fewer home sales. Many of the big builders have cash to spend on land again but are buying only what they can sell homes on quickly. 

Federal aid from a new tax break and a shift by homebuyers away from foreclosures are also driving the recent land purchases. 

“Builders are buying Phoenix-area land now because they expect to make money on it in the near future,” said Arizona home-building analyst RL Brown. “Builders are more optimistic about the housing market now, but the smart ones are still being very cautious.” 



The $90 million in recent land purchases by builders reveals new trends and different hot spots for the new-home market stirring back to life in Phoenix. 

Homebuilders are more selective now, buying fewer lots and in specific target areas. Sites closer to Phoenix’s core and near freeways are drawing the highest prices. Builders want lots prepped and ready for new homes for faster, less-expensive turnaround in the buy-build-sell cycle. 

“Most builders now will buy 50 to 100 lots in a development, instead of the 200 lots they would have purchased before the boom,” said Nate Nathan, president of Scottsdale-based land brokerage firm Nathan & Associates. “Builders have adapted to the new market reality in Phoenix. The profit margins are tight.” 

Mesa, Chandler and Gilbert, land brokers say, are now the hot spots for homebuilders. Lot prices in those southeast Valley communities have almost tripled in the past two years. Home sites are selling for more than $80,000 in parts of Chandler, prices similar to what builders paid in the pre-boom years of 2003-04. 

More than 50 percent of metro Phoenix’s new-home sales during April were in Mesa, Chandler and Gilbert. 

Developments along the Interstate 17 corridor north to Anthem and in Avondale and Goodyear in the West Valley are also popular with builders. Land prices in these areas are climbing as well, but lots are still typically selling for below $40,000. 

Parcels in metro Phoenix’s most far-flung communities including Buckeye west of the White Tank Mountains and the Pinal County communities of Coolidge and Eloy aren’t drawing a lot of builder attention now. The areas are too far out for most current buyers because their tastes have changed, no matter how inexpensive new homes are priced.

Builder profits


Despite recent increases in new-home construction and sales, the home-building industry is still dealing with the worst housing market in Phoenix history. 

About a dozen of the region’s builders have figured out ways to make money constructing less-expensive homes. These builders have cut costs on labor, materials and marketing. Builders no longer own the expensive land purchased during the boom. That land was sold for a loss or lost to foreclosure. Now, builders are repurchasing the same land for less than half what it sold for in 2004-06. 

“Smart builders have cuts costs to the point where they can sell homes for less but still see a slight profit,” Brown said. “Construction costs are half of what they were five years ago. Builders’ office and marketing overhead is one-third of what is was then. Homes have been streamlined with fewer expensive amenities and extras.” 

Brown said to save money, the president of one of metro Phoenix’s biggest homebuilders serves as salesperson at one of his subdivisions every Friday. 

Most builders also are receiving some federal help. A change in the federal tax law last year allows companies to apply recent losses against profits during the boom years. As a result of the change, U.S. homebuilders have collected billions of dollars in tax refunds. 

“The nation’s biggest builders are sitting on more than $12 billion in cash,” said Greg Vogel, chief executive officer of Scottsdale-based Land Advisors Organization. “These builders can buy land and hold it longer. But it has to be the right land to draw the homebuyers.” 

He said there are subdivisions in metro Phoenix where 20 to 30 new homes are selling a month. Last year, builders were reporting fewer than five home sales a month in most of the area’s subdivisions. 



A recent shift in metro Phoenix home-buying tactics also is helping homebuilders. 

More homebuyers have become frustrated with the bidding wars and delays in foreclosures and short sales. During the past few months, a growing number of people have opted to buy new homes or existing homes sold through a regular sale. 

“We are competing with the resale market in the Valley,” said Steve Hilton, chairman of Scottsdale-based Meritage Homes. “People will pay a small premium for a new home now in prime locations.” 

The median price of a metro Phoenix new home sold during April was $199,362, up from $188,000 a year earlier, according to the “Phoenix Housing Market Letter.” 

Many builders ramped up home construction in anticipation of the federal homebuyer tax credit. The deadline for the credit was April 30. Buyers have until June 30 to close on home purchases signed by the deadline. That means sales spurred by the federal tax credit could boost new-home sales until July. 

Josh McNeil is shopping for a new home in Gilbert or Queen Creek. He didn’t make the deadline for the federal tax credit but thinks he will find better deals on homes now. 

“Prices have gone down some in a few places where I am looking,” he said. “I think the builders built homes for buyers they thought would move faster for the tax credit.” 

New-home sales in metro Phoenix climbed slightly to 823 in April from 789 during the same month a year ago. 

McNeil is planning to buy in the next six months and wants a new home because he has friends who have failed multiple times trying to buy foreclosures or short sales. 

Cautious outlook


The increase in land purchases is one of several early signs of higher expectations for the new-home market. 

Nationally, builder confidence is the highest it’s been since August 2007, according to the monthly National Association of Home Builders/Wells Fargo Housing Market Index. 

Through April, new-home permits in the Phoenix area were up 90 percent from last year. 

But to keep that increase in perspective, 2009 was the slowest year for home building since the early 1970s. For the first four months of this year, 2,964 new-home permits have been issued in metro Phoenix, compared with 1,561 for the same period in 2009. May figures aren’t yet available. 

“I think Phoenix’s housing market will gradually get better. But I am not looking for it to get dramatically better anytime soon,” Hilton said. “Some builders are overpaying for land now because they are too optimistic.” 

Land prices have climbed faster in metro Phoenix than in almost any other part of the country, according to a report from the national housing-research firm Zelman & Associates. California’s Inland Empire area has also seen big jumps in land prices 

The forecast for metro Phoenix home building during the next few years is for small annual increases until at least 2012. 

Housing analyst Brown expects 8,500 new homes to be built in metro Phoenix this year, up from 8,000 in 2009. But his forecast calls for 22,000 new permits in 2012. 

Market watchers are waiting to see if new-home sales continue to climb later this summer, after the final deadline for the federal homebuyer tax credit. No one is expecting big monthly increases in metro Phoenix home building this year, but small gains could lay a foundation for the industry’s recovery.

Author:  Catherine Reagor
The Arizona Republic

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Jerry Raviol
West USA Realty

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How do FHA appraisers determine which home improvements add value and what needs to be “called out” or repaired prior to a buyer getting an FHA loan? These were 2 of the topics discussed during a webinar I participated in June. Give me a call and I’ll be glad to share what we learned.

Jerry Raviol
West USA Realty

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Foreclosure vs. Short Sale

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To Foreclose, or not to Foreclose – that is the question. What should you do and why?

Jerry Raviol
West USA Realty

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Jerry Raviol – West USA Realtor

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Welcome to Arizona Homes and Real Estate by Jerry Raviol!

Jerry Raviol
West USA Realty

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