I do work with a few buyers , because I enjoy working with them and it gets me out to see a lot of the inventory I otherwise wouldn’t see, and helps me stay up on the market and to be a better Realtor overall. I work with a variety of banks and “REO outsources” (asset management companies) from across the nation, and I list and sell their properties in Santa Clara, Santa Cruz, and Monterey Counties – from San Jose to Salinas, from Boulder Creek to Santa Cruz, Watsonville, Pacific Grove, and everywhere in between. … Several people told me it was the best presentation they saw at the expo. This year, it seems there was no housing expo – but I think there is now perhaps more interest than ever in buying foreclosure real estate. … I won’t talk (much) about short sales, for example – this will have a solid focus on the process of buying a foreclosure property on the “retail” market, and is aimed at the average buyer just looking to buy an affordable home here in Santa Cruz.
You really need to look at the year before to see how the market performed – and from the statistics, we can see the median home price, county-wide, is actually down 33.5% in April of 2009 compared to a year ago. … Honestly, I am mystified how people can take a few anecdotes, completely ignore the state of the economy and the housing market as a whole, and now herald, with strident authority, that we are now at the bottom of the market and THIS, TODAY is the time to buy, or you will miss out on the chance of a lifetime. … Well, that’s not true – short sales can also occur at those prices, and some people who have had their homes a long, long time may have enough equity in them to compete with all the REOs and short sales. … Personally, I think it’s going to put increased pressure on the bottom of the market, as many people who were looking at buying a lower-priced “starter” home may now be thinking of stretching to go for one of these “premium” foreclosures which I expect we’ll be seeing.
Whether you think the current housing crisis is a cause of a symptom of the economic meltdown in the United States and abroad, there’s no denying that there’s a great deal of uncertainty about how long this recession will last , how deep it will cut , and what this means for people looking to buy a house in Santa Cruz today. I’ve said it several times in various postings to this blog, but I think it bears repeating: I think home prices in Santa Cruz county will continue to drop for the foreseeable future – and by that, I mean the rest of this year, at least. … It’s not a new thing – as I mentioned a blog entry or two ago, this multiple-offer feeding-frenzy has been going on at least 18 months, I don’t see that it is more common today than it was a year or so ago – but perhaps it’s being talked about more in the media, as there is now more effort into talking up the economy rather than talking it down. … I had seen it when it had come up (I send myself e-mails from my automated system for every bank-owned home that hits the market), but at the moment, I had a number of deadlines I was working to meet so I didn’t look at the particulars to see that it was really an incredible deal. … Actually, when it started out, I don’t think it was a short sale – but as the months went by, the price was reduced until finally the owner owed more on it than the market would pay.
Fact is, we have been seeing multiple offers for well over a year now on these bargain-basement properties in Watsonville – and pretty much anywhere in California where bank-owned foreclosures are sold several percent cheaper than competing properties – these properties attract multiple offers and sell quickly. … Pretty much – I didn’t go into 87 Arista when it was on the market, but from what I can tell on the MLS from the pictures, the choice of paint colors and level of amenities in this home was about on par with my listing. … And then, a scant two months later, my own listing comes on with an asking price of $250,000 – that’s 3.8% less than the sale price of a very very comparable property which closed just two months earlier…and I’m on the market eight days, and I’m standing in a field of chirping crickets . … But not too far below – if in fact you were able to buy a home for 10% below true market value, you could not do a thing to the property, then turn around and sell that property to someone else the next day for 10% more than you paid for it.
If you are thinking about buying property in Santa Cruz County in 2009, there’s a very good chance that you’ll be considering buying one of these homes. There’s a great deal of confusion around buying bank-owned homes. I do have some information on my web site that should be of interest to folks interested in doing so, specifically my Santa Cruz Foreclosure Report (delivered via e-mail), as well as the Santa Cruz Foreclosure Opportunities video which I had taped last year at the Santa Cruz County Housing Expo. … If a bank has two offers on a property, one with a conventional loan and the other with an FHA loan, the buyer with the conventional loan usually wins out, even if it’s for a bit less money. An all-cash offer will, of course, trump an offer from a buyer needing a loan, assuming it’s close to the same price – a cash buyer will not have any loan or financing contingency, and that’s one less thing for the seller to worry about, and one less way a deal could fall apart.
The auction is being held at the Hilton Garden Inn and they will be auctioning off properties from the Salinas-Monterey area. As it happens, one of my own REO foreclosure listings is going up on the block – 6 Minto Road in Watsonville. … Also, the auction company is doing a whole series of auctions – for example, on November 15 at the San Ramon Mariott, they are auctioning off Bay Area properties (there are quite a few) and on November 16, they are auctioning off a good selection of properties from the Sacramento area at the Radisson Hotel Sacramento. The auction is being put on by Hudson and Marshall , and they gave me a little F.A.Q., which I think applies to all Hudson and Marshall auctions, and is similar to auctions put on by other companies, e.g. … A: You must have a photo ID, cashier’s check or cash in the amount of $5,000 Q: How much earnest money must I put down if I am the winning bidder?
I think they expanded the digit count because the MLS is growing, it won’t just be the five counties around here (Santa Cruz, Santa Clara, San Mateo, Monterey, and San Benito) but will expand to include the Greater San Francisco Bay Area. Another thing that’s happened release with “Release 3.8” of MLSListings.com is that you can now search for bank-owned REO properties. … The thing is, of course, that the agent has to manually set that flag, and agents are not the most detail-oriented people in the world – especially busy REO agents, who often put no comments or pictures on their REO listings. We’ll see how well that works out – but no matter, because I have my own weekly Santa Cruz REO and Short Sale list that I send out, which I find by manually reviewing all the listings that come on the market each week and send the list out to subscribers.
And, while I said that hardly anyone outside the real estate profession knows what those designations mean, many of my colleagues in the industry (especially experienced, long-serving Realtors) do know what those mean, and when you see an offer coming in from someone with, say, a CRS designation, you kind of know that this person is likely to have something of a clue as to how the business actually works. … So I’ll do one two-day CRS seminar, take a day off to play in Vegas, then do this REO seminar, and then two more days of CRS seminars…and then on Sunday, I’ll fly home. … It’s going to be punishing staying away from my business right now, for a whole week, during the busiest time of year – how many deals will I lose? … I’ll be out of town from June 8 to June 15 – I’ll bring a laptop with me, of course, and my cell phone – I’ll be out of town, but not out of touch.
Or, if their asking prices are reasonable, more often than not, it’s a short sale, which means that the contract and price are subject to approval of the one or more lenders which have loans outstanding against the property. … That leaves bank-owned “REO” foreclosure properties (not all of which are actually priced to sell) and those few not-overly-encumbered homes with enlightened sellers who realize where their homes need to be priced in order to actually be in the market and have a decent chance of selling. So when you look at homes that are actually in the market and priced right, there really is not a good selection of these kinds of homes. … Beyond the fact that the seller, a bank, already said it was an as-is sale and no repairs would be made or credits issued for same, there’s another salient point: there were three offers on the table.
When a bank is selling a property (or, typically, it’s an asset management company that sells the property for the investor, marketed on the MLS using the services of a Realtor), there are few disclosures made about the property – because, of course, the owner of the property is an investment firm in Abu Dhabi or the pension fund for a plastic toy factory in Shenzhen, China – and what, really, could such an owner know about the property? … She went on to say that there had been, in effect, a property line adjustment, and the subject property (the one I was helping my client to buy) had relinquished some “useless” land behind the garage in exchange for some use of some of the neighboring ‘s land, which was a non-exclusive easement benefiting the subject property but had been used for years and years exclusively by the former owners. … At some point during all this, I had talked to the listing agent for this parcel, and he said he’d heard about the lawsuit, and said he heard that there were some un-recorded grant deeds lying around, but didn’t really know much about it and would check with the owner and get back to me. … To make a long story short, after a week or so of hemming and hawing and talking it over with various parties concerned, we made a devil’s pact with the bank – we would take the property as-is, and proceed to close immediately, if the seller (“the bank”) would drop the price by about 10%.
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