Last week I was out showing a buyer customer of mine some nice homes in a local waterfront gated community.
Most of the listings in this particular section of the community were listed as short sales. The short sale listings ranged from $280,000-400,000. Most were in the mid 300s. None had recently sold. The ones that were not short sales were well over $400K.
I called to make appointments on a few listings. Two of the listing agents informed me not to bother because the property wasn’t even available to be shown. Why I ask? Well, according to the agents, because there are uncooperative tenants currently in the units who will not allow anyone in. So why is it even in the MLS? To worsen our already over supplied inventory of homes?
When I called the listing agent with the least expensive unit to inquire about where they were at in the process he told me they were just waiting on an offer to submit to the bank. I asked him why he had listed so low & he said he thought it was a good place to generate some buyer interest. I guess he thought that starting too low would be a great way to get some leads.
He then went on to say that I was only the 2nd call since the huge price reduction. Really?? Want to know why? Well, because agents don’t want to waste their or their buyer’s time looking at a property that is not going to be able to be bought at or probably even near that price. We are not in a market to justify bidding wars & GAMES.
Agents, short sales should not be treated as auctions (unless you are truly conducting an auction).
You should be listing them just slightly under fair market value. You should know what this value is if you’ve completed a true CMA. If you don’t know what the property is worth maybe you should consider a new profession. We price our listings at FMV & continue to make regular price reductions if we are not having much activity. This method makes sense & shows the lender a TRUE picture.
Buyers might be able to buy a property at 80-90% of fair market value but probably not at 50% of fair market value. (By the way, fair market value is TODAY’s value - not that of 2-3 years ago at the peak).Usually when a buyer puts an offer on in a short sale they are expecting to save money - or else it wouldn’t be worth the time & aggravation BUT the banks are NOT giving away these homes. Sure, there have been a few STEALS but it is about timing and being able to wait.
Agents, please stop the games. This is NOT helping anyone. You are not helping the seller, yourself, other agents or buyers. It is a waste of everyone’s time. Are you using the listing & seller to generate buyer calls or are you seriously clueless???? You are scaring buyers & other agents away from showing these short sale listings. You are hurting the sellers that need you most.
By the way, the other day I was calling to make appointments to show many short sale listings. I called a few agents to find out where they were at in the process. A few seemed clueless. They said they didn’t know what to do or that their seller was negotiating with the bank. themselves & the agent was clueless.
A few more seemed to have the process started with some knowledge of the process. A couple of agents told me that they had accepted full price offers & were looking for back up offers. I questioned them about why it was still showing up as active & they said they were told to leave it active. After contacting the board, I was assured that these type of pending sales should be marked pending as well.
I know that some buyers get frustrated with the wait & that it would be nice to have a back up offer ready to go but it’s not really helping us much handling the pendings in a non-professional manner. Time deadlines should be kept track of, met or extended & we should proceed as if we are truly going to close. If for some reason the buyer changes their mind inside of the contract period they should be treated just like any other transaction & face losing their deposit.
I had a couple of short sales that the buyers flaked on & once I had an accepted price from the lender I reduced the property in the mls to their approved price & had a new offer within a day.
Buyers & Sellers, please use your due diligence when selecting a real estate agent to assist you with the sale or purchase of one of the most expensive & often times, life-altering financial decision.
Agents, please take the time to learn more about short sales & let’s all work together to move this excess inventory before the situation worsens.
Yours in Success,
Susan MilnerBroker of Florida Future Realty, Inc.
(239) 218-2229
This is just Unbelievable says Cindy Roper, Sales Associate, Sellstate Achievers Realy Network. “We have a buyer who is ready, willing and able to purchase - has found their dream home to retire in - enough down payment money - has wonderful credit - has shopped till they drop - knows that they made a wise choice in location and quality in a home - Your asking “WHAT’S THE PROBLEM?”THE APPRAISAL
Yes, even though the home can appraise for the purchase price the appraiser says
NO!!!
Is this crazy? says Cindy ” In todays market when it is so so hard to find a qualified buyer that is approved for a mortgage here we go. The Lender has applied such strick guide lines for the appraiser, they have made this impossible. Imagine lending money to someone who can actually pay their mortgage!!
Can you believe this? The property would appraise - we have the comps, but the LENDER wants the cheapest and shortest on the market listings and sold properties available ..
AND THEY SAY LOCATION DOES NOT MATTER ANYMORE!!
What’s next?
Many real estate sales professionals have been demoralized by the media’s constant negative portrayal of our industry. The media neglects to mention some hard facts – in 1997, the total number of homes sold reached 4.37 million and the average sales price was $159,700. In 2007, we are projected to end the year with 6.11 million homes sold with an average sales price of almost $230,000. That’s nearly a 70% increase in both average home prices and number of homes sold over the past ten years. In 2008, projections indicate that a total of 6.37 million will be sold with an average home price of almost $235,000.
Bob Wade
Cypress Realty GMAC
Craig Guillot of Bankrate.com thinks “the residential real estate market shows signs that demand is building and home values may start recovering in 2008.” With home sellers cutting prices and builders getting rid of excess inventory, bargain hunters may snap up those houses. “While the housing downturn may not be good for the overextended homeowner or mortgage lender left holding the bag, many economists agree that it is healthy to make a transition to a housing market driven on fundamentals instead of speculation. ”
What do you think?
