Short Sales are a Joke! (foreclosed, lender, home sales)

[annerk]

We just had a short sale go through in my neighborhood. $700K owed, listed for $525K, house sold for $380K. Took under a month from the time the cash buyer first made an offer until he closed. Sounds to like it's not the bank but a real estate agent playing games in the scenario described.

[PineIslander]

It may be due to many reasons, including the agent not being educated in this type of transaction. But ponder this: Home goes on the market for $249K (Short Sale) and is not even shown so we lower to $199K. Handful of showings but no offers. Then down to $179K, still no offers. Finally drop the price to $159K and the flood gates open up. 7 offers and the home sells for $219K as a short sale.

This would have taken half the time (and prob sold for less) if someone would have made the offer prior to $159K price change. I still can't figure that one out.

[justNancy]

Originally Posted by PineIslander

It may be due to many reasons, including the agent not being educated in this type of transaction. But ponder this: Home goes on the market for $249K (Short Sale) and is not even shown so we lower to $199K. Handful of showings but no offers. Then down to $179K, still no offers. Finally drop the price to $159K and the flood gates open up. 7 offers and the home sells for $219K as a short sale.

This would have taken half the time (and prob sold for less) if someone would have made the offer prior to $159K price change. I still can't figure that one out.

Interesting comment about human nature, although I also can't figure it out! Maybe people like to know they're getting a deal and it helps if others are competing? I've been to auctions (not real estate auctions) and getting someone to make the first bid always takes the longest. I realize the offers aren't shared among the buyers, so can you tell me how someone knows if she is outbid - or do you only get one shot when bidding on a bank owned property?

[PineIslander]

Originally Posted by justNancy

I realize the offers aren't shared among the buyers, so can you tell me how someone knows if she is outbid - or do you only get one shot when bidding on a bank owned property?

You won't know until it is over. I know it is not what people are hearing about our area but you need to make your highest and best offer FIRST on SS and foreclosures. If there is something that is priced very well then you need to make an educated offer. If you want to make an offer 25% off of list price on a foreclosure or short sale I will give you the name of another Realtor that will help you out. It really is not worth writing. A good Realtor knows their market and can tell you the strategy that will give you the best chance of getting an accepted offer. Low-balling a bank will only waste your time.

[JudiPatooti]

We've been working with an agent in the Tampa area who won't even show us a short sale because he himself said it's such a lot of nonsense, waste of the buyer's house hunting time when they could be looking for a house that's priced honestly, and the whole thing almost always ends in stress, heartache and no purchased home for the buyer. And, he told us it's unscrupulous realtors who set those low prices, as someone else in this forum has said. He said they advertised these great houses at ridiculously low prices to get people into their office as customers. I guess then they hope you'll buy something else from them.

You'd think that by now this would have been stopped by a law against it or something!

[mrcoolmrcool28]

Our agent said the same.

[fwi]

We made a cash offer of $70K on a short sale house listed for $79K last September.
The house is in a very nice SW Cape Coral area, across the street from $400K waterfront homes, it needed some cosmetic work but it was'nt trashed in any way.
We could have closed the next day, but it took the bank until February to say ok and we closed at $71K.
Don't always blame the realtor, although a lot of them are slugs.
Short sales are very difficult to deal with for all parties involved, in that the lenders require tons of paperwork (and several more tons if you are getting a loan). Short sales are real, but they require a LOT of patience..........we gave up on ours several times!
BTW, we never had one penny up front on this deal, only the original purchase offer contract, which expired in October!
We did however luck out in dealing with a very ethical, honest and experienced short sale realtor!!!

[nhkev]

I'll give you another tip regardless of what the asking price is determine the homes value. most realtors have a home value calculator on their websites that you can put in the address and it takes a sampling of homes that have sold in the area ( for example ) a house in my neighborhood is listed fo 95k on a short sale but homes like it are selling for $118k if someone offered 118k they would still be getting a great deal in a low market the house sold for 260k 2 yrs ago the bank would look at the offer and probable accept it w/in 30 days.. banks do not have an incentive right now to sell it at 95 because volumes have been up double digit for 7 mos and median home prices have leveled off have even inceased month over month. If you're afraid you are going to miss the boat then ignore the asking price on short sales.

[jvelte]

Originally Posted by nhkev

I'll give you another tip regardless of what the asking price is determine the homes value. most realtors have a home value calculator on their websites that you can put in the address and it takes a sampling of homes that have sold in the area ( for example ) a house in my neighborhood is listed fo 95k on a short sale but homes like it are selling for $118k if someone offered 118k they would still be getting a great deal in a low market the house sold for 260k 2 yrs ago the bank would look at the offer and probable accept it w/in 30 days.. banks do not have an incentive right now to sell it at 95 because volumes have been up double digit for 7 mos and median home prices have leveled off have even inceased month over month. If you're afraid you are going to miss the boat then ignore the asking price on short sales.

Good tip, thanks. One thing I don't even consider is what they sold for in 2005-2007. The unjustified, insane price one person paid a few years ago does not reflect the true value.

[nhkev]

Originally Posted by jvelte

Good tip, thanks. One thing I don't even consider is what they sold for in 2005-2007. The unjustified, insane price one person paid a few years ago does not reflect the true value.

I agree that the house for $260k was overpriced but it cost $185k to build and the median income supports $179k and if the population continues to grow supply vs demand will increase values just as the pendullum (I wish I had spell check) swings too far one way it has definetly swung too far the opposite - true value is only determined by what someone is willing to pay for it. But if I were a betting man I would say anyone who but right here at these prices will be happy with their homes value in 5 yrs.