Queen Creek, Arizona

How much home can you really afford in Queen Creek, Arizona?

When it comes to buying a home in Queen Creek, and figuring out how much you can afford, there are a lot more factors than just how much money you make.  There are factors such as credit score, credit history, and available cash that will also determine how much home you can, or should buy.  Everyone knows that qualifying for a loan these days is much more difficult than four years ago, and to some extent, that is a good thing.  At the same time, if you are in the market to buy, here are some things you should be aware of given today's current lending environment.

Credit Score - The lower your credit score, the higher your interest rate will be when qualifying for a loan.  If your credit score is too low, you will not even qualify for a loan.  To qualify for an FHA loan, most lenders will require you to have a credit score between 620 and 660.  For a conventional loan, your credit score needs to be above 680, and preferably over 720.  The higher interest rate you pay on your loan, the less of a home you can buy, so having a good credit score can help you buy more with your money.

Credit History - Along with your credit score, lenders will look at your credit history.  This includes the number of revolving accounts you have, the balance on those accounts, and how much you pay each month on these accounts.  These revolving accounts include all credit cards where you carry a balance each month.  This also includes other things like car loans, student loans, and any other monthly debt payments you make, including rent or a current mortgage.  It is critical to maintain a low balance on any of these accounts if at all possible and make sure to pay these bills on time.  You also must not have too many of these accounts, as any payment on them is going to reduce the amount of money you can apply towards a new mortgage payment, and you won't be able to buy as much home.

Cash - Another factor to determine how much home you can afford is the amount of cash you have to apply towards closing costs, and/or a down payment.  You can get a lower interest rate by putting a larger down payment on a home, and if it is more than 20%, you will avoid paying Private Mortgage Insurance (PMI).  You can also pay for closing costs, which will reduce the overall loan amount.  You can also buy down the interest rate if you have cash, which will reduce the monthly mortgage payment, and allow you to buy more home.

If buying a condominium, townhouse, or single family home in a cummunity with a homeowner's association, those monthly fees will also reduce the total amount you can afford on your monthly mortgage payment.  If you own your own business, how much income you declare on your tax return is what will determine how much home your lender feels you can afford.  Stated income loans have pretty much gone away, and lenders want to see at least two year's of tax returns for your business, a profit and loss statement for the current year, as well as other documents.

One final thing to remember is that you don't need to accept how much the lender says you can afford when it comes to buying a home.  You need to make sure you are comfortable with the loan amount and the monthly payments.  So, how much home can you afford to buy in Queen Creek depends on your income, credit score and credit history, the amount of cash you have, and how much you are comfortable spending.

Queen Creek Stats - The difference between Queen Creek homes in Maricopa County and Pinal County.  If you didn't already know, part of the Town of Queen Creek is in Maricopa County and part of the town is in Pinal County, and there are significant differences in the two.

Queen Creek	Median Price 2008	Median Price 2009	Median Price Change 2008-2009	Overall Sales 2008	Overall Sales 2009
Maricopa County	$230,000	$200,706	-12.7%	984	1,104
Pinal County	$144,677	$110,000	-24.0%	4,379	4,489

As you can see, Queen Creek homes in Maricopa County are selling for a lot more than Queen Creek homes in Pinal County.  Part of the reason for this is that Queen Creek in Maricopa County includes everything north of Empire Blvd., and west of Meridian.  This part of Queen Creek includes Ellsworth Road, which is the main downtown area, and also includes where the town offices are located, as well as new shopping centers, strip malls, and restaurants.  Much of the property in that area near downtown Queen Creek was agricultural land that was subdivided into large acred lots.  There were many custom or semi-custom built homes on those properties that started around 2000.  Many of these homes were built before the housing boom of 2005 and 2006, but they also included neighborhoods like Rancho Jardines and Sossaman Estates.  Many of the average size homes in these neighborhoods are over 3,000 square feet, and/or the property sits on a acre of land.

The Pinal County side of Queen Creek is further east, as well as south of Empire mainly along the Hunt Highway.  Although this area is nice, this area tended to develop more tract homes in residential neighborhoods.  They include the community of Johnson Ranch and San Tan Heights, and are not as close in proximity to shopping, employment, or entertainment.  It is still a developing area comercially because of the large number of homes that have been built in that area.  These homes tend to be on even smaller than standard sized lots, and average closer to 2,000 square feet or smaller.

So, as you can see by the chart above, the Maricopa County Queen Creek homes are almost selling for double what the Pinal County Queen Creek homes are selling for, but the Pinal County homes are selling at a rate of almost 4 to 1 over the Maricopa County Queen Creek homes.

Queen Creek Foreclosure Resales	Traditional Resale Median	Foreclosure Resale Median	Traditional Resales	Foreclosure Resales
Maricopa County	211,500	206,000	504	447
Pinal County	110,000	100,000	382	398

What is interesting about this foreclosure table above is that the foreclosures in the Maricopa County area of Queen Creek are holding their values better than the foreclosures in the Pinal County area of Queen Creek.  Queen Creek in Maricopa County is only seeing a drop of 2.6 percent between traditional resale and foreclosure resale median prices, while Queen Creek in Pinal County is seeing a 9.1 percent difference.  Also interesting is even though Queen Creek in Pinal County is averaging almost four times the number of overall sales (see table 1), they are experiencing fewer traditional resales and foreclosure resales than Queen Creek in Maricopa County.  I'm not sure what to think of this last statistic, but overall when you are buying a home in Queen Creek, you need to know whether you are buying it in Maricopa County or Pinal County.  There are many factors other than sales price that make up the difference between the two; such as utilities, property taxes, and fire and police service, as well as overall quality of life to consider.  There is truly a difference between Queen Creek in Maricopa County and Queen Creek in Pinal County.

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Contact Troy and Mia Erickson, Realtors®, Terra Solis Realty, LLC. Licensed Residential Realtors® in Arizona at 602-295-6807 for Chandler, Gilbert, and Queen Creek Arizona custom, unique, and luxury Real Estate.

You can view all Chandler, Gilbert, and Queen Creek custom, unique and Luxury Real Estate from our website.  We are here to help you buy or sell!

I had an especially nice St. Patrick's Day, as today I had a closing in the newly named San Tan Valley.  This area is East of Gilbert Arizona, and used to be a part of the Town of Queen Creek.  I was fortunate enough to work with a wonderful buyer, and was lucky enough to get the transaction closed.  This was an investor owned home that was purchased less than 90 days ago, and was being sold at more than 20 percent of the investor's purchase price.  Needless to say, we had some hurdles to overcome.

I am just thankful that the seller stuck with us, as he had a cash buyer waiting in the wings.  The transaction took longer than anticipated, but the seller provided all the documents necessary to satisfy the lender, and it eventually closed.

I will be very happy to turn over the keys to the buyer when she arrives in town on Friday!  She will also qualify for the first time homebuyer tax credit, which is an added bonus to getting this deal done.  If we would have had to start over, I don't think we would have made the deadline.

Now I am ready to do another deal in San Tan Valley, or perhaps start getting some listings to sell in the newly named San Tan Valley.