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Old 10-11-2012, 06:14 AM
 
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Twin Cities housing prices rise again - TwinCities.com

Houses in my neighorhood are selling in days, not weeks or months. The house across the street sold in 3 days for 10K over the asking price.
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Old 10-11-2012, 06:22 AM
 
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The housing market would be a heck of a lot better if the BANKS would catch up. Our son has had offers in on 2 houses. The first one the bank knowingly didn't fix a faulty furnace, he backed out on that one due to the results of the inspection. The second one appraised out at 20,000 under asking, which we figured based on other sales of similar properties in the area, the bank wouldn't meet the appraised price. Both houses are back on the market and can't be sold until the bank does what they are supposed to. DS was preapproved and ready to move in less than a month on both houses, they could have been off the books. Now the bank is paying taxes on the houses and will have to winterize them, costing them more in the long run.
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Old 10-11-2012, 06:27 AM
 
25,833 posts, read 16,499,625 times
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Quote:
Originally Posted by golfgal View Post
The housing market would be a heck of a lot better if the BANKS would catch up. Our son has had offers in on 2 houses. The first one the bank knowingly didn't fix a faulty furnace, he backed out on that one due to the results of the inspection. The second one appraised out at 20,000 under asking, which we figured based on other sales of similar properties in the area, the bank wouldn't meet the appraised price. Both houses are back on the market and can't be sold until the bank does what they are supposed to. DS was preapproved and ready to move in less than a month on both houses, they could have been off the books. Now the bank is paying taxes on the houses and will have to winterize them, costing them more in the long run.
I don't understand how the bank owned properties are handled. My daughter and her husband looked at a bank owned house in my neighborhood. It was really a nice design, in fact I would have loved to buy it but DW said no. It needed serious foundation repair, probably 20K on that alone. It needed window repairs and new carpet, paint and general clean up.

So they made an offer for over the asking price if the bank would add the money on to the mortgage for the repairs. They have excellent credit but just didn't want to get into a house and then have to be broke for the next 5 years doing repairs.

Bank said no. Then like you said paid taxes and upkeep on the house for 6 more months and then lost another 10K selling it for less.
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Old 10-11-2012, 06:33 AM
 
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The bank owned properties are already being sold for a loss, so I do get that, to a point, but how much more of a loss do they want to take. The first property, DS offered over asking but included some closing costs so it really got down to "asking" price. The taxes on the property alone cost more than a new furnace would cost. We don't get it either. The problem is, without a working furnace, they CAN'T sell the property. The other place, who is going to put an extra $20,000 down in THIS market?? Appraised price was only $85,000 (townhome).
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Old 10-11-2012, 07:55 AM
 
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Quote:
Originally Posted by golfgal View Post
The bank owned properties are already being sold for a loss, so I do get that, to a point, but how much more of a loss do they want to take. The first property, DS offered over asking but included some closing costs so it really got down to "asking" price. The taxes on the property alone cost more than a new furnace would cost. We don't get it either. The problem is, without a working furnace, they CAN'T sell the property. The other place, who is going to put an extra $20,000 down in THIS market?? Appraised price was only $85,000 (townhome).
I could be wrong on this, but I think part of the issue is accounting -- once the bank sells the house for a loss, it hits their books as a loss (i.e. they've already lost money, but once it is sold it becomes official). So if they unload a bunch of properties all at once at a loss, it has a big impact on their profitability and could even bring their solvency into question. Thus, they'd rather wait if they can, even it means losing more money in the long run, because it won't hit their bottom line in the same way. Like I said, this might not be correct, but it's my theory.
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Old 10-11-2012, 08:38 AM
 
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Of course they are going up, I am planning to buy next year
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Old 10-11-2012, 08:44 AM
 
10,624 posts, read 26,709,681 times
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Quote:
Originally Posted by PullMyFinger View Post
Twin Cities housing prices rise again - TwinCities.com

Houses in my neighorhood are selling in days, not weeks or months. The house across the street sold in 3 days for 10K over the asking price.
Yes, that's been the case in my former Minneapolis neighborhood, too. Houses are moving VERY quickly! Those aren't foreclosed properties, though. What a huge frustration to would-be buyers (and to neighborhoods) to have empty properties that could easily sell if not for the banks.
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Old 10-11-2012, 01:26 PM
 
20,793 posts, read 61,252,305 times
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Quote:
Originally Posted by QuietBlue View Post
I could be wrong on this, but I think part of the issue is accounting -- once the bank sells the house for a loss, it hits their books as a loss (i.e. they've already lost money, but once it is sold it becomes official). So if they unload a bunch of properties all at once at a loss, it has a big impact on their profitability and could even bring their solvency into question. Thus, they'd rather wait if they can, even it means losing more money in the long run, because it won't hit their bottom line in the same way. Like I said, this might not be correct, but it's my theory.
I don't know how it works exactly either but by my math if you spend $3000 to fix a furnace and get it off your books it's less of a loss then paying $4000 in taxes PLUS having to winterize the house, pay for lawn/snow removal, etc.

Non-foreclosure houses are flying off the market around here, but unfortunately my DS isn't looking in the $300K+ range.

Last edited by golfgal; 10-11-2012 at 02:07 PM..
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Old 10-11-2012, 02:00 PM
 
Location: Southwest MPls
191 posts, read 380,060 times
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There's a simple answer. The shadow inventory (real estate owned - REOs). Repossessed homes across the country that banks purposely keep off the market. Refraining from dumping a large inventory of foreclosures on the market helps to keep home prices from falling steeply. Something like 90% of REOs are held off the market:

http://realestate.aol.com/blog/2012/...perties-are-h/
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Old 10-11-2012, 03:34 PM
 
643 posts, read 1,036,568 times
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Banks have been sitting on a lot of property in SE Mpls to the chagrin of the neighbors because nobody wants to drive down a street looking at vacant properties. Apparently, it is reasonable to try and sell a building that looks like a Taco Bell at more than $750K.....
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