- Many sellers are angry or confused... or both. Their sense of entitlement is overwhelming, as they firmly believe that the value of their home cannot - EVER - go down... "because this is America!" Nearly every consultation with a seller begins with, "We're not going to give our house away." In this market, having a realistic seller is akin to having a bucket of gold.
- There are really THREE (3) MLS databases:
- The first is called "Fantasyland." This is where the above-referenced sellers have their homes listed at "pre-2006" prices. They are hoping and praying and playing ostrich. They haven't read the paper...
- Secondly, there are the "Short Sale" listings. This is where folks go who are trying to avoid foreclosure. Investors go here too, because they think it's a "get out of jail free" database. They don't understand that banks are in the business of making money and are exceedingly reluctant to let people off the hook... who have other assets! Today, "short sale" listings have become a catch-all of teaser prices. WARNING: If you get involved as an agent or a buyer here, do your homework and be prepared to wait a long time (90-120 days) for an answer. HINT: The answer is often, "No." In order to end up with a successful closing, list prices should be about 10% below market - to prompt offers. Offers, on the other hand should be close to market, in order to elicit a positive response from the bank. Regarding price? Make sure the relationship between your offer and the mortgage payoff amount makes sense. The bank won't take "$150,000... on a house appraised at $275,000... with a payoff of $350,000."
- The third database is where motivated sellers (Harry and Mary Homeowner, Banks, REOs) are listed and are ready to do business... today.Today, there are 10,809 "Sold" properties in our database, from the past 36 months. Of these, there are 77 short sales. That's about six tenths of 1% of the database. Hardly a panacea for great deals.
- Just because it says "foreclosure" or "REO bank-owned," does not automatically qualify them for Investor Nirvana. Look at all your options, as there may be Mom & Pop sellers who are highly motivated too.
- Because you peruse the Internet sites and see lots of homes for sale, does not mean you "know the market." If I go to a medical web site and look at photos and read all about knee replacement surgery, I'm still not an orthopaedic surgeon. This is a tough business sometimes... and we are fully immersed. There is an amazing amount of "turmoil" under the surface of a real estate transaction. With 22 years of real estate sales and training agents and sales management, personal investing, constant reading and personal education... along with chairing our Arbitration Committee and conducting mediation of real estate related disputes... I (and others like me) can really help you make good decisions.
This market won't last forever, Thank God. There are plenty of signs that initial recovery has started. We are really busy! It's not like 1999-2005... and it's not a lot of Waterfront, Canals, and Hammock Beach, but we are busy. Why? Because those that missed the boat last time around, don't want to miss it again. As the lower end clears out, the funnel will flow more freely for the rest of the market. Hallelujah!