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Old 03-26-2010, 08:30 AM
 
1,106 posts, read 2,051,223 times
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That's what I said. Read my post again, more slowly and out loud if you need to.
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Old 03-26-2010, 10:30 AM
 
Location: South Tampa
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All very good points here. It is very important that you do your homework regardless of how you buy property to understand the value of the property that you are considering. Also with all of the foreclosures, short sales, and auctions out there, always research the clerk of the court information (Here is Hillsborough County's site Home) for liens and judgements against the property and the seller. These will all be brought out by the title company and the title company whick will take the research one step further. Always work closely with the title company to understand before closing what they are seeing as far as judgements and liens. Another thing to look for is open building permits on the property because the new buyer inherits the cost of correction.
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Old 03-26-2010, 10:54 AM
 
26,809 posts, read 41,566,940 times
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Quote:
Originally Posted by Tampasteve View Post
All very good points here. It is very important that you do your homework regardless of how you buy property to understand the value of the property that you are considering. Also with all of the foreclosures, short sales, and auctions out there, always research the clerk of the court information (Here is Hillsborough County's site Home) for liens and judgements against the property and the seller. These will all be brought out by the title company and the title company whick will take the research one step further. Always work closely with the title company to understand before closing what they are seeing as far as judgements and liens. Another thing to look for is open building permits on the property because the new buyer inherits the cost of correction.
If you buy a foreclosed home or short sale and get title ins. you should be fine, since you buy it with a clean title...it is more the auctions that are dangerous....
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Old 03-31-2010, 12:21 AM
 
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Default SF experience with foreclosures and Auction.com

Here is our experience with foreclosures and auctions in the past 18 months:
-Bid on 8 properties on Auction.com and won one in Fort Lauderdale. Two weeks later lender backed out of the deal. Auction.com is not a true auction as it does not bind the lender but Purchaser assumes all risk if deal is accepted under "as is" clause. Also auction.com can use phantom bids to reach the "reserve price" but lender reserves right to decline even though the reserve is reached. Documents heavily stacked towards lender such as "as is" and "chinese dry wall" clauses. However if you win the auction the purchaser is bound to close deal. Some lenders will use auction.com as a marketing plateform and continue to receive offers outside of auction.
-Made 3 offers in Miami/Miami beach and 4 offers in Hallandale/Ft. Lauderdale on foreclosed properties but did not win any. All properties had mulitple offers with some getting 10+ offers. Generally, prime or class A properties(ie: beach front newer buildings in downtown core areas) will generate closer towards market prices....prices that will be close to what is sold for similar non-foreclosed properties. So the discount will account for the "as is/no warranty/no representation" clause offset by the bank paying for the doc stamp fee, title ins etc. However, in any transaction foreclosed or not you have to ensure you are satisfied that you are getting "marketable title" even though it maybe insured.
-Other true auctions like on [URL="http://www.fisher.com"]www.fisher.com[/URL] or Higgenbothem or the one at Signature Place put on by Accelerated Marketing do not allow the lender to back out and may disclose the reserve price if any. Try to look for "absolute auctions".....no reserve price auctions. By the way, Florida has a "cooling off" period for condos....3 days upon receipt of condo docs. In the Signature Place auction, I understand that they offered a 15 day cooling off period so that you could always change your mind if you realized that you got caught up in the frenzy.
Overall, I wouldn't discount auctions, particularily the true auctions but use them if they come up along with foreclosures and short sales. That being said, I believe your best best on getting the deal you want is to getting familar with the area you want and see what comes up.
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Old 04-05-2010, 10:35 AM
 
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From what I've heard of the Signature auction, it was a brilliant strategy by the developer to sell most of the remaining units in the building. Gotta give them credit for that. No doubt it is a great building and I'd love to have a view of the bay. BUT, I think I also heard the association dues are over $600/month? I'd heard of dues like that when I was in Hawaii, but at least you're getting meticulously groomed tropical environment in a resort atmosphere- pools with waterfalls, etc. What could you possibly get in a downtown high rise that is worth that kind of money?

I don't have the patience required to get a good real estate deal. Apparently the house next to us (short sale) was under contract for 6 months while the lender tried to make up his mind. The irony is, congress can spend billions on a TARP program with much less time spent on debate.
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Old 04-06-2010, 01:40 PM
 
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Any waterfront condo will have huge monthly fees. The wind/fire insurance for just the structure can easily run $200-300 a month per unit. Throw in round-the-clock security and full-time maintenance staff, a pool, shared HVAC systems (big chillers aren't cheap), etc, and you can get to $600+ in a hurry.
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Old 04-13-2010, 09:49 AM
 
69 posts, read 221,488 times
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The house I recently purchased in Pasco County was a short sale. I was expecting it to take forever but it actually transacted quite quickly. My offer (which was very close to the ask) was accepted by the bank in about two weeks.

The previous owners had owned the home for 15 years and paid almost half what I paid but they refinanced the property in 2007 for a ridiculous amount. If they hadn't refinanced, they'd probably own the house free and clear.

I didn't steal the house but I think I paid a fair price for what the market currently reflects.

This was not the only short on which I bid and some of the others were filled with red tape and dishonest sellers/agents. But if you're not in a hurry (in other words, if you're patient) you can get a very fair deal on a short sale.

Incidentally, of all the properties I viewed, the one I purchased was the only property that was currently occupied and consequently was in the best condition by far (though dated). A lot of the foreclosed properties were intentionally stripped and damaged by the previous owner and would have needed extensive work prior to being occupied.

Tipsy
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Old 04-13-2010, 10:57 AM
 
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Quote:
Originally Posted by TipsyMcStagger View Post
The previous owners had owned the home for 15 years and paid almost half what I paid
Just a word of caution in figuring the relation between what you and a previous owner paid. You might have already figured this, but as I've read some discussions online and talked to neighbors who've mistaken their figuring, I just thought I'd mention that...

A) Inflation determines the current cost of a house relative to a previous sale. If the previous owner paid $150,000 15 years ago, then a bit over $213,000 today matches the purchasing power of $150k 15 years back. So for them to have "paid almost half what (you) paid", your cost would not have been $300k, but $426k, twice the inflated (real) figure, not merely twice the nominal (non-inflation adjusted) value.

B) The cost of a house is not just dependent upon the purchase price, but also upon the sale of a house if ever sold (plus various expenses minus rents that would have been paid out otherwise to have a place to live). Having purchased 15 years ago, around 1995, the previous owner bought at near the bottom of the last wave so likely they did not do too badly (aside from all that ATMing you mentioned, of course.) Just to calculate: Say they bought at $150k 15 years ago and sold at $300k today, then their annual rate of return would have been 4.72%, probably good in normal times, maybe not so great during the good times, but certainly not terrible having sold in the middle of a depression.

C) Just to complicate things, whether or not you did so well now, relative to their original purchase, becomes dependent upon how well or badly they did in their time, relative to area comps 15 years ago. Because if they overpaid then and you are judging just by that one property and not by the entire area, then you might have overpaid again today. (likely you didn't but just thought I'd throw some buyer's remorse out there for kicks).

Enjoy your new home in good health. So sad seeing so many ATM their financial lives away, but sometimes it is hard to feel very sorry. I also purchased at arms length an ATM'd property still wholly owned but at a virtual foreclosed price though it was originally free & clear to the previous owner who recently drove by, stopped in and suggested renting back from me. I noted the brand new fancy car bought, no doubt, with the money I paid for the property. Some folks never learn.
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Old 04-13-2010, 12:03 PM
 
69 posts, read 221,488 times
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Quote:
Originally Posted by housingcrashsurvivor View Post
Just a word of caution in figuring the relation between what you and a previous owner paid. You might have already figured this, but as I've read some discussions online and talked to neighbors who've mistaken their figuring, I just thought I'd mention that...

A) Inflation determines the current cost of a house relative to a previous sale. If the previous owner paid $150,000 15 years ago, then a bit over $213,000 today matches the purchasing power of $150k 15 years back. So for them to have "paid almost half what (you) paid", your cost would not have been $300k, but $426k, twice the inflated (real) figure, not merely twice the nominal (non-inflation adjusted) value.

B) The cost of a house is not just dependent upon the purchase price, but also upon the sale of a house if ever sold (plus various expenses minus rents that would have been paid out otherwise to have a place to live). Having purchased 15 years ago, around 1995, the previous owner bought at near the bottom of the last wave so likely they did not do too badly (aside from all that ATMing you mentioned, of course.) Just to calculate: Say they bought at $150k 15 years ago and sold at $300k today, then their annual rate of return would have been 4.72%, probably good in normal times, maybe not so great during the good times, but certainly not terrible having sold in the middle of a depression.

C) Just to complicate things, whether or not you did so well now, relative to their original purchase, becomes dependent upon how well or badly they did in their time, relative to area comps 15 years ago. Because if they overpaid then and you are judging just by that one property and not by the entire area, then you might have overpaid again today. (likely you didn't but just thought I'd throw some buyer's remorse out there for kicks).

Enjoy your new home in good health. So sad seeing so many ATM their financial lives away, but sometimes it is hard to feel very sorry. I also purchased at arms length an ATM'd property still wholly owned but at a virtual foreclosed price though it was originally free & clear to the previous owner who recently drove by, stopped in and suggested renting back from me. I noted the brand new fancy car bought, no doubt, with the money I paid for the property. Some folks never learn.
I wholeheartedly agree with everything you've written and I did in fact consider the effect of inflation. This is why I felt comfortable making an offer so close to the asking price. Florida has made it very simple to determine previous sale prices for properties online (at least, Pasco County has) so I not only knew what the previous owner had paid, I was also able to determine how much "equity" they'd cashed out for their refi. I felt my offer was fair given the location, condition and current economic environment.

I'm happy with the deal that I got. If the market recovers even marginally, I'll come out ahead. And that doesn't even take into consideration the years of enjoyment I'll have spending time at my new home that was only a pipe dream for me four years ago!

Tipsy
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Old 04-13-2010, 07:39 PM
 
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Nice Tipsy. Good to see opportunity for some arise from so much opportunists' folly. It is a shame that some good but ill-informed people were brought down with them. And of course others simply had the rug pulled out from under them. Financial lessons can be expensive.

From what you just said, it sounds like the previous owners did well, house-wise, if not wisdom wise, earning more like 7%/annual on their original purchase price, exemplifying that it is not just when one sells, but when one buys.

I did similar research before buying ATM'd property. And now I am researching even more thoroughly before possibly buying another. Though records exist, this area has some difficulty in figuring because many of the properties have been held in the same families for generations. I am only the 1st owner outside the original family of the houses I bought. So it turns out that while not all that much sold here during the bubble (so far I estimate less than 1/3rd the neighborhood's housing stock but will know better once I finish my study), the ones selling now are going at crash prices, which allowed me to buy at about 40-50% off what the price to rent ratio would indicate to be fair market value even with these very affordable rents.

I don't think my offer was fair, but, apparently, at the time, it must have been the best offer out there. With so few buyers today, the previous owners of our properties were lucky we found them.
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