Priced right REOs are moving fast

Dominoes:

I agree with your comment regarding Banks backing away from new loans in Destin and PCB. Additionally, it doesn't surprise me to see Banks bumping the rates due to risk.

I closed on a condo in PCB back in February. My mortgage broker called me 3 weeks later to tell me that I had closed just in time. Apparently, Chase mortgage stopped underwriting loans along the beach and if I had attempted to close just three weeks later, Chase would have walked away from my deal.

I don't assume lending restrictions have become easier over the course of four months.

Little Fish

I have not run into any lending problems at all. The only problem I see is they keep coming by the office and giving us bags of goodies to eat! Please make them stop!

I have not run into any lending problems at all. The only problem I see is they keep coming by the office and giving us bags of goodies to eat! Please make them stop!

I have not run into any lending problems at all. The only problem I see is they keep coming by the office and giving us bags of goodies to eat! Please make them stop!

...next time they come, tell them to bring sacks of corn instead.

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...next time they come, tell them to bring sacks of corn instead.

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so they can make their own bio-fuel? Wouldn't a gas card be easier?

Some friends of ours converted their diesel car to burn vegetable oil a while back. When they have a party, we'll bring them a gallon of peanut or canola oil as a hostess gift instead of wine or flowers.

so they can make their own bio-fuel? Wouldn't a gas card be easier?

No...the dollars put on the gas card will quickly depreciate, whereas the value of the sacks of corn will appreciate going forward. The corn can be used to make biofuel; feed the livestock; ground into flour; or replanted to grow more corn.

Corn, the new Gold...the perfect hedge to the US Dollar--valuable, versatile and tasty too!



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So SHELLY, when it comes to corn your saying....



Now's the time to buy?

Figured I would chime in since I haven't posted in a while. I watch this market on a daily basis and I can clearly see that this market is NOT at the bottom. We have another 12-24 months of falling prices in my opinion (In many areas). The inventory seems to have leveled off, but is going to be a slow go in getting eaten up. There are some great deals out there and several that have been bought already this year. These are either foreclosures, short sales, or sold by people who bought pre 2003.
The problem with the short sales is that in most cases they are taking waaaay too long to get a response. Banks are overloaded with properties and understaffed is an understatement. The foreclosures are a great way to go as you can usually get a response within 24 hours. I have submitted offers on 3 different REO properties in the past 3 weeks and all were part of a multiple offer situation. When the banks price them right, they are moving.
The main factor I am seeing is the rise in short sales over the past several months. The way the banks are moving on these things we will see twice as many foreclosures over the next 12 months. Short sales that don't sell will soon become foreclosures!! I'm a little perplexed about this situation because the bank is probably going to eat another 20% off of what they could get on most short sales once they list it as a foreclosure. I think it really has to do with the vast understaffing of the banks.
Anyway that's my 2 cents on the situation as it stands. Boos and jeers welcome.

Figured I would chime in since I haven't posted in a while. I watch this market on a daily basis and I can clearly see that this market is NOT at the bottom. We have another 12-24 months of falling prices in my opinion (In many areas). The inventory seems to have leveled off, but is going to be a slow go in getting eaten up. There are some great deals out there and several that have been bought already this year. These are either foreclosures, short sales, or sold by people who bought pre 2003.
The problem with the short sales is that in most cases they are taking waaaay too long to get a response. Banks are overloaded with properties and understaffed is an understatement. The foreclosures are a great way to go as you can usually get a response within 24 hours. I have submitted offers on 3 different REO properties in the past 3 weeks and all were part of a multiple offer situation. When the banks price them right, they are moving.
The main factor I am seeing is the rise in short sales over the past several months. The way the banks are moving on these things we will see twice as many foreclosures over the next 12 months. Short sales that don't sell will soon become foreclosures!! I'm a little perplexed about this situation because the bank is probably going to eat another 20% off of what they could get on most short sales once they list it as a foreclosure. I think it really has to do with the vast understaffing of the banks.
Anyway that's my 2 cents on the situation as it stands. Boos and jeers welcome.

Welcome to the real world Josh!

I see the meds have worn off.

Elgordoboy, be a dear and get Josh a copy of the novel "Condominium"...I think he's ready for it...and just in time to join Shelly's Summer Book Club too.

Shel.

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My newest "market pulse" reveals that short sales have leveled off for the third straight month in Destin, I am not seeing any increase. What I am seeing is alot of contracts!

http://thewiredagent.com/pulse.html

My newest "market pulse" reveals that short sales have leveled off for the third straight month in Destin, I am not seeing any increase. What I am seeing is alot of contracts!

http://thewiredagent.com/pulse.html

A lot more contracts for sure. I wasn't specifically speaking of the rise in short sales over the past 3 months, but say the difference between February and today. I should have been more specific. I think once the rental income dies down we are going to see more. I think many people are taking the rental income, making payments and hoping that they can sell in time.
I'm having a great year (for me) as far as sales go, and finding some great deals for buyers, but I have many more buyers looking in specific areas that I have told to wait until later in the year for their deal to come up.

Wow, Josh...refreshing assessment. It pretty much matches up with what I'm seeing and thinking. Hats off for the honesty.

A real wake up call for me was spending a week in Tampa and seeing the house prices there. My brother lives on Sand Key, and there are tons of houses on the water (Intracoastal)with docks, just a block to the beach, near grocery stores sans tourist pricing, restaurants, shopping, etc., for about half of what similar property is listed for here. Granted, I prefer this area...but Tampa's airport is already up and running.

My brother bought in 2006, and if he chooses to sell (he wants a house on the water) he'll lose about $40,000. I guess the difference is that they had a few flippers, but the speculation wasn't as rampant.

Punzy,
You just need someone sending you the foreclosures and deals as soon as they come on the market and you will eventually find what you're looking for.

I find it difficult to get a true grasp on the number of REOs vs Short sales vs foreclosures, because I see that most agents who are listing short sales, don't actually enter the sale type correctly as short sales. If you search for sale type: REO, you will see that more than 50% are incorrectly listed, and they are actually short sales. Yes, it's possible to work around that as a Realtor by searching for key words, but one would think that the people listing short sales, would at least be familiar enough with short sales to know that they are not REOs. Makes our job as Realtors more difficult to extrapolate good information when pulling listings, and in my opinion, it does a dis-service to the sellers and buyers.

Just my $.03 (note the price increase for my thoughts.)

I find it difficult to get a true grasp on the number of REOs vs Short sales vs foreclosures, because I see that most agents who are listing short sales, don't actually enter the sale type correctly as short sales. If you search for sale type: REO, you will see that more than 50% are incorrectly listed, and they are actually short sales. Yes, it's possible to work around that as a Realtor by searching for key words, but one would think that the people listing short sales, would at least be familiar enough with short sales to know that they are not REOs. Makes our job as Realtors more difficult to extrapolate good information when pulling listings, and in my opinion, it does a dis-service to the sellers and buyers.

Just my $.03 (note the price increase for my thoughts.)

Couldn't agree more SJ.

I get quite frustrated when the listing agent doesn't even SAY it's a short sale in the MLS blurb, extra sheet points when they also have no clue how to do all the paperwork or have the property listed BELOW what the bank will accept!

My newest "market pulse" reveals that short sales have leveled off for the third straight month in Destin, I am not seeing any increase. What I am seeing is alot of contracts!

http://thewiredagent.com/pulse.html

That is our best month in 2.5 years! And it is not just Newman-Dailey. Check out this overall activity:

Destin single family homes sold since May 1 (58): Report
Throw in another 48 that are currently under contract: Report

and you can see that the single family homes are moving.

So, if houses are still are lots any better? Has the cost of building come down?

I saw some pretty intriguing prices on builder specs at Watersound North recently. It's too far from the hospital for us, but they looked like good values, IMHO. Does anyone know if that might be a better route at this point in time?

Building costs haven't really gone down as demand has decreased (despite what everyone is telling prospective clients until they have to put their money where their mouth is) because material and delivery/shipping costs have gone up.

I think you guys should buy a lot in PW and build, but that's just me!

My newest "market pulse" reveals that short sales have leveled off for the third straight month in Destin, I am not seeing any increase. What I am seeing is alot of contracts!

http://thewiredagent.com/pulse.html

What percentage of the "contracts" are actually turning into "sales?" Do you keep a "Sales/Contracts Ratio?"

.

I think once the rental income dies down we are going to see more. I think many people are taking the rental income, making payments and hoping that they can sell in time.

Josh,

Couldn't have said it better myself...

I'm sure buyers will appreciate your new and true-to-life outlook on this market. The "Rah-Rah Real Estate" hook doesn't reel in nearly the number of fish as it used to.

Good luck and keep it real kiddo.

Shel

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I get quite frustrated when the listing agent doesn't even SAY it's a short sale in the MLS blurb, extra sheet points when they also have no clue how to do all the paperwork or have the property listed BELOW what the bank will accept!

You can thank the lender for that lack of communication. I have not heard of any lenders willing to disclose the amount they are willing to accept, so it is up to the Realtor to price the property low enough to get offers, but high enough to meet the lender's level of acceptance and the appraiser's price point. That is a difficult task, since the lender won't say a word. They just say, "bring us a written offer, and we'll look at it." So, as you can imagine, this can become a sales gimmick to lure buyers in at unrealistic prices. I've seen that a few times. It is important for all agents to communicate to any potential buyers, that the list price on short sales is not necessarily a price which the lender will accept. It may or may not be, and perhaps it is close enough to negotiate a sale. You just don't know until you propose a written offer.

So, if houses are still are lots any better? Has the cost of building come down?

I saw some pretty intriguing prices on builder specs at Watersound North recently. It's too far from the hospital for us, but they looked like good values, IMHO. Does anyone know if that might be a better route at this point in time?

You can build for around $125-$150 sq. foot right now. If you add the lot price to the construction it is looking pretty good to build. Plus you get what you want where you want. We are looking to build on a lot in Seagrove and will be coming in with land included around $350,000 (1500 sq. feet 3 br. 2 bath home).

..and with building, you get new construction built to current code, which was updated last year.

One more note regarding my frustration with the REO (incorrectly listed as such) properties which are really short sales: REO (real estate owned by the bank) properties are listed at a "real" price. Short-sales are not necessarily listed at a "real" price. So, when you see a price of $250,000 for a house located south of 30A, there may be a big difference in the listing, depending on whether it is a true REO or short sale. Looking at the listing alone will not always get you that answer.