Short Sales May Define the Real Estate Market
August 3, 2011
In a quick check of the number of short sales in the active listings posted in the CRMLS for the fourteen communities that I have been tracking for several years, I found that the short sale inventory in most of these communities represents 50% of what is for sale. Moreno Valley still has the highest percentage at 59.4%. Redlands has the lowest percentage at 28.2%.
Buying a short sale property may prove to be an excellent value. However, prospective buyers need to recognize that going from the initial offer to a completed transaction may require patience and perseverance.
While the lender will ultimately decide on the price, terms and conditions of an acceptable offer, the seller/owner must decide whose offer to accept to be submitted to the lender for approval.
It can take a long time to receive lender approval. The more straightforward the offer, the better the chance of approval.
Also, most lenders will not pay for repairs or for termite work, septic inspections, homeowners past dues, etc, etc. If the appraisal calls out repairs that must be made, chances are the buyer will have to pay for them as often the seller has no money to contribute which is why the property is a short sale in the first place.
Buyers should do inspections while they await a response from the lender. Buyers need to know what they may be getting into in extra costs.
Short sale rules and regulations have come a long way since 2008 and lenders, sellers, buyers and agents are adapting to this segment of real estate sales.
In a quick check of the number of short sales in the active listings posted in the CRMLS for the fourteen communities that I have been tracking for several years, I found that the short sale inventory in most of these communities represents 50% of what is for sale. Moreno Valley still has the highest percentage at 59.4%. Redlands has the lowest percentage at 28.2%.
Buying a short sale property may prove to be an excellent value. However, prospective buyers need to recognize that going from the initial offer to a completed transaction may require patience and perseverance.
While the lender will ultimately decide on the price, terms and conditions of an acceptable offer, the seller/owner must decide whose offer to accept to be submitted to the lender for approval.
It can take a long time to receive lender approval. The more straightforward the offer, the better the chance of approval.
Also, most lenders will not pay for repairs or for termite work, septic inspections, homeowners past dues, etc, etc. If the appraisal calls out repairs that must be made, chances are the buyer will have to pay for them as often the seller has no money to contribute which is why the property is a short sale in the first place.
Buyers should do inspections while they await a response from the lender. Buyers need to know what they may be getting into in extra costs.
Short sale rules and regulations have come a long way since 2008 and lenders, sellers, buyers and agents are adapting to this segment of real estate sales.
posted by shirley harry at 8:16 AM
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