Mike’s Real Estate Show

There is a reason a “Short-Sale” property will be on the market for 100 days–it is NOT being shown because it is listed as a “Short-Sale”. Many Realtor/Licensees try to diguise them under our confidential remarks by stating, “subject to third party approval” as an attempt for us to show these listings. If you look at the numbers of “Short-Sales” and the actual % of them which close, it is VERY discouraging. More disturbing to me are folks tracking “in-escrow” properties and pointing to the “bloated” numbers as an indication of an improving marketplace–nothing could be further from the truth. The “Short-Sale” stacks up in the “Continue to Show” category as they take months to close or NEVER close. They  can take months to negotiate, are presented by Realtor/Licensee’s who don’t KNOW what they are doing, are NOT willing to spend the time or money not only in the daily follow-up needed ONCE it gets into escrow but also in any marketing to draw attention to the property.
When we had “Debt forgiveness” as a concern, getting the biggest price for our seller was paramount. Now with the “Debt Forgiveness Act” which allows a home owner up to $2,000,000 in forgiven debt, price is NOT that big of a deal. So getting $100,000 off the list price might seem BIG for you but frankly the seller could sell for $250,000 under the list price–it is all CONTINGENT UPON LENDER APPROVAL!
Indicators of this market are all over. Our Tuesday Realtor marketing breakfast tours the East and West sides of Santa Rosa weekly. When we go West we have maybe 1 or 2 pages of listing to view. The Eastside will have 4-7 pages. Why? Westside properties are NOT even be marketed to the REAL ESTATE COMMUNITY let alone YOU the consumer!  A friend publishes one of the local real estate for sale magazines–it is razor thin! Why? The REO or Post-Foreclosure agents know their product is going to be undercutting the market and fly out the door in multiple offer frenzy and the “Short-Sale” (pre-foreclosure) agent is NOT going to waste their money on marketing a property which has an 8% chance of closing.
I would continue to look at other properties and NOT get your sights set on buying this property. I keep seeing agents in our MLS saying “Short-Sale” approved but then they say, “Any brokerage fee will be split 50/50 between agents”–we’ll if it is APPROVED then don’t you KNOW the commission? Now here’s the big conundrum–if you find an REO property you really like and you are a first timer with little or no down, be prepared to get beat out by investor’s and other’s with big bucks for a down payment.
In Sonoma County about 60% of our paltry 400 sales in May where either post or pre-foreclosed properties and new home builders Liquidating. NO ONE is moving up!! This is NOT a healthy market but opportunity does abound if you are savvy and have a Realtor/Licensee who knows their way around the battlefield!!