Seventy-five percent or more of the calls I field each week are from buyers seeking a great deal on a foreclosed property.
And don’t get me wrong … there are plenty of them out there. The Coweta County Georgia area gets more than its share of bank-owned houses. And many of these REO properties languish on the market for a long time due to a variety of salability issues.
However, the houses that are in good condition that are priced aggressively move VERY quickly. The majority of buyers are seeking the move-in ready foreclosure in the best location.
So it is extremely important to have financing already in place and to be prepared to move quickly. There better-than-usual foreclosures can generate multiple offers the FIRST day that they’re on the market, so a buyer must be alert, diligent, and totally prepared to take the plunge and write an offer.
If there are multiple offers, the institutional owner may choose to deal with the best one. Never assume that the owner will call for “highest and best,” so make certain that your initial offer is the most that you are willing to pay
A real estate agent that is experienced in foreclosure sales can be very helpful and can provide guidance and advice based on experience, and that can lead to a successful transaction!
There are plenty of foreclosures on the market, but only a few of them are “keepers!”
So it is essential to be correctly poised and ready to take the leap!
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price anything aggressively and it will sell...even those with issues...they are just priced too high...right?
James...
Most of our buyers need insured loans, so the properties that need repairs are left to the investors who are having more and more trouble getting loans. So even if those houses are priced right, there is a diminished pool of buyers for them.
Thanks so much for the comment.
Richard, too many buyers still go into the market, think that n matter how good it is, they still want to make it better. You are right on about getting their financial house in order with that pre-approval, having the agent get real comparables to demonstrate the value, and be prepared to give your best, I want this house offer, initially, or else be greatly disappointed with no one to blame but themselves.
Right on the money Richard. Those who wish to wait will be left in the dust and will miss the great ones that come by!
Good Morning Richard,
Thanks for the post. Have a great day.
I see it here also. good conditino homes sell fast. We are seeing less and less in the foreclosed market as of late.
Richard,
Good post!
It is difficult to get across to some buyers that the market IS functioning, and there is definite competition for value.
So while it is a Buyer's market, and smart Buyers can do well, it is not a market for the tentative or indecisive.
Richard,
Many REOs in my area receive multiple offers, especially those priced aggressively. Even those that don't sell right away, eventually sell. Buyers don't always have a whole lot of time to think.
Always a great idea to reverse the classic placing the cart before the horse mentality!
Loan Officer for hire...available 7 days/week (seriously)!!
Foreclosures, are just like straight resales, the best values go quickest. I will not show REO's to anyone that does not have financing in order. Its a waste of both our times.
We will often have multiple offers on foreclosures that are in good condition and priced right. Buyers think we're in a buyer's market and are always surprised when the words "multiple offers" are spoken.
Yep they better not wait on the good ones because value sells just as it always has.
A good REO agent is key! So many buyers mistakenly think foreclosures are simply "houses on sale" - they do not realize if they are priced significantly below market value, they probably need a lot of work.
Foreclosured or not, in te Silicon Valley homes that are priced agressviely will often get multiple offers so be prepared and know your values.
Richard- Great point about the bank not always looking for the highest offer. Ability to close, cash v financing and other factors come in to play
Richard, on well priced REO's if you snooze you loose. Good advice, in multiple offers the bank might not come back with a call for highest and best.
Richard, our foreclosure inventory is very slim for anything but very distressed properties. The good ones tend to go under contract immediately. Buyers, especially unrepresented buyers are very frustrated and just don't seem to understand how the process works.
Best points to me were having financing ready and offering the right price first. A lot of buyers think they're the only ones out there looking for deals, and they will be very disappointed when learning the truth, dealing with both other buyers and investors.