San Diego Housing Bubble News and Analysis

Besides the hand-picking, the so called listing agents/realtors also discourage potential buyers from submitting offers. I noticed this property (http://www.sdlookup.com/MLS-071085224-12...) closed last week for $810K with same selling and listing agent. My agent and I did contact the listing agent when the price dropped to desirable level but was told don't bother because they got plenty of offers in the pipeline. We were willing to put in at least $830K because of the house, canyon view, upgrades, etc....

Anyway, this "ethical" agent did what is best or him or herself instead of idiot banks. I hope there is a way to rat this lowlife agents. I am with you Murf222.

We were very interested in an REO listing that hit the MLS on a Monday, but before we could even get in the car and go see it, it went pending that afternoon. Our agent was very surprised because she said the banks usually had a 72 hour active market time clause. When she checked it again, she could see that it was input into the MLS two days prior so total market time read 3 days, but was activated on the third day so to the public there was really only less than a day of market time. Very frustrating!

I am dying to see what the house closes for. We submitted a back-up offer and I am going to report this to the DRE if the accepted offer closes for less than what we offered. I'm sure it will go nowhere, but I feel that we as consumers need to start complaining before anything will be done. This whole realtor self-regulation thing just isn't working.

Good for you, kismet. If more people report, then maybe they'll do something.

it's a shame that realtors have such power over things

It is a very unfortunate that this sort of stuff happens. Not only does it suck but the only recourse for consumers is to make a complaint to the DRE and/or the better business bureau. Kismet you may want to also ask your agent to call the listing agent and ask them if the agent who is representing the buyer is an agent in the same office. With REO properties usually the lender does ask the listing agent to hold the property on the market for at least a few days.

There is certainly alot of abuse going on. Additional regulation to level the playing field and make short sales AND REO properties more available to EVERYONE would be quite welcome.

This is the same thing we were discussing here, among other places:

http://piggington.com/who_would_you_repo...

BTW, the FBI did get back to me back in November/December and said that they were not pursuing that particular kind of fraud because they didn't think it was widespread enough. Seriously. :(

If law enforcement ever wanted to get ahead of crime, they would read these blogs and get on the ball BEFORE all the damage was done. It's very frustrating.

People (myself included) were trying to warn them years ago about fraudulent deals that were pushing prices up during the boom. They couldn't have cared less. Then, when "the world is coming to an end," and they want our tax money, the govt claims that "NOBODY could have seen this coming." Lying maggots...

FBI: Are you listening now????

ahem.......how do I become "hand-picked"????? Anybody want to sell me a shortsale/foreclosure cheap??? I will use you as the realtor.....

Seriously, how do I get in on the shenanigans? I am willing to compromise my ethics for a good deal....

are realtors flat-out accepting bribes? can you just pay them to sell it to you cheap?

CAR - You're my hero for today :)

Maybe if they get enough complaints, they'll do something about it.

This would not surprise me.

I remember an offer I made in Bay Park. I made a decent, solid offer. It remained on the market a long time, eventually selling for more, but still, I say, inside deal. They didn't even try to get a counter out of me.

if you wanna state the address i can look it up and let you know who the buyers agent was so you can see if it was an inside deal or not.

FBI will only get on it if Congress wants them to. It's probably worth trying to get your Congressman involved, if you can.

Of course, many key members of Congress are trying to ensure there are no speed bumps for the govt money pouring into housing. So your Congressman may not be interested in pushing the FBI into something that's still happening. (My C-critter is Barney Frank, for example, and I know he has no interest in depriving the housing market of any really large flow of money, fraudulent or not.) Better to have the FBI go after the stuff that's already stopped of its own accord. Or your Congressman may not have much power to go against the real barons - Barney, Dodd, Schumer, Pelosi etc. (Bipartisan complaint here - it's just that most power to do damage or otherwise lies with Dems now, and the Repubs are almost irrelevant, except as a way to deflect attention.)

All I can say is that I am participating in numerous short sale listings right now and it is very complex. Not nearly as cut and dry as you would hope or think. The listing agent is representing the seller whose best interests are served by getting the transaction completed as quickly as possible with the least liability for them going forward. That does not always mean getting the highest possible offer.

On some listings I get offers that I know the property could never appraise for. If the lender approves that offer they have set unreasonable expectations for their investors. The property goes into escrow with a weaker buyer that wont be able to get a loan, the property does not appraise, we have to go back and start over with the lender and their investor. Nobody's best interests have been served!

I always try to be fair to all buyers while bringing the lender a solid offer from a strong buyer at a price that the current market comps can support. Sometimes it is clear and sometimes it isnt. Sometimes the best buyer is brought by another agent and sometimes they come knocking on my door. Every single one of these transactions is grueling. They suck the life out of me.......

BTW, I often get lowball cash offers also. Cash buyers seem to think their cash is worth alot more than it actually is. I always tell them that all buyers are cash at closing, its just that the cash comes from someone else than the buyer(i.e. a lender). In the few cases that lowball offers have been the only offers submitted, the banks have refused them. i just havent seen short sale properties given away at prices well below market value. Maybe others have but I havent.

I think you are all getting fired up about much ado about nothing.........

sdr wrote:

Cash buyers seem to think their cash is worth alot more than it actually is.
---------------

If not for the govt meddling in the mortgage and housing markets, that cash would be worth far, far more.

The mortgage market is totally subsidized at this point. At some point, cash will mean something again (we can hope!).

And now the closing price is 15k less than what I offered.
http://www.sdlookup.com/MLS-090005276-91...

I believe that there was something going on there. Can you check if this is an insider transaction?

There is definately going to be some cheating out there, how much is going to be hard to know. There is also certainly an element of making a heap out of not so much. Facts are for some buyers it is hard to get their foot in the door. I saw this in 2000 on lower priced houses while making offers in the ball park of asking. Buyers get anxious only to find they repeatedly are not getting to escrow on houses they choose. The buyers agent needs to cull most of the non-starters first, don't waste you time on things you can not buy for one reason or another.Don't write an offer with a loan type that won't make it due to the condition of the house/condo( the listing agent can't use it). In some cases writing multiple offers site unseen is a good way to go. I have had buyers give me four properties at a time in order of interest. We would write four offers and start viewing based on that order. We would get to escrow pretty quickly with a property that would succeed. I do not recommend this as standard proceedure of course. If the market allows for looking and patiently contemplating a deal that's better. Sometimes submakets don't allow for that and making a timely purchase.

sdrealtor is probably right in that there is usually two sides to the equation, but when I hear stories like this, and the fraud and corruption that must have played a part in this whole mess, and now they are saying TARP money is being "stolen" by banks, I am glad my wife and I took the decision to leave California. We're going to ride our the recession on the Big Island, and if after a year, the recession has knocked some sense into this place, we may return. So far I've seen enough to convince me otherwise.

CAR
Cash does mean something just not as much as they think. This will always hold true.

Like Russell said there is defintely some cheating going on. This is America! There are cheaters everywhere and why would this be any different than Barry Bonds. The cheating is most likely simply a realtor looking for a bigger paycheck. While it occurs i wouldnt classify it as a major market problem right now. It is amplified because it is so hard to find and buy a decent house right now.

Cahunter I checked the MLS and the home sold for 302k. The financing was conventional as well so nothing special there. The selling agent was listing as an out of the area office so the agent did not two side the deal, nor was the deal done by another agent in that same office.

One thing that may have happened was a quick acceptance? I know this is kind of uncommon. I did have a client and he put in an offer immediately on an reo property and the agent sent it right in. That same agent continued to receive offers and had sent them in as well but because ours was sent in first the bank actually accepted ours that next day. In the meantime she got several more offers higher then ours. So we got extraordinarly lucky.

I am not sure that this happened in your case but it could be a possible explanation. All I can say on this one is if there was some sort of bs going on here, (and I wouldn't rule it out quite yet) the agent went even further and disclosed incorrect information on the MLS.

One thing I would do if I were you, just to satisfy your curiosity is to call the broker and ask what happened.

Why on earth in today's climate would you want to "compete" for a house?

The banks and Realtors are the only ones who can possibly come out winners.

Do a little research.

Buyers want to buy and they have a tendency to flock to the same properties.(This adds to the fact or notion that the market is on fire).If you want to sit on the sidelines fine, but if you want to buy a house in some cases you have to compete.This is true even when it absolutey did make sense, no doubt about it, to buy a house. There will not come a magical time when houses are extremely cheap, market bottom cheap and nobody wants them!

If you think everyone who buys now is going to get killed you are probably going to be wrong. Some are, but things are in fact different. There are people buying well below their means much more so than in recent times. Some properties will not go upside down at all now...ever. A lot will but it won't kill the buyer who can afford the house. You take a house two years ago that was twice the price it is now and that has the potential to hurt almost anyone.

My two cents on cash offers...

Cash has more potential to matter for fixers, cracked slabs, condos with poor occupancy rates and high distress ect.In other words,where several people with loans are not fighting to pay top dollar.

Cash offers are strongest with zero contingencies or at least shorter contingency periods.Raise the earnest money deposit a bit. There are plenty of flaky cash buyers so you have to look certain to perform.

The listing agent would be doing the seller a disservice by taking a lower cash offer on a turnkey property that had a lot of traffic and would close easily with any loan type.

SD R
You may have missed something. Do you think its possible the agent entered out of area agent to hide that they double ended it and to avoid answering to angry buyers agents? Could be?

Where do you report such activity? This is asinine.

I have seen a lot of this with both reo's and shorts recently.

I think SD had a thing on it as well.
A buyer makes an offer over market and gets to the front of the line.
During escrow, their appraiser decides that the market price does not justify the inflated price and the contract gets revised back down to earth.

The seller (bank or individual) decides to stick with the escrow so as not to have to market it again.

Sketchy but legal (I think).

For example the asking is $300k.
Your offer is $310k.
The other buyer offers $350k.
The seller goes with that offer.
The appraisal comes back at $302k.
Seller sticks with the current escrow at the appraisal price.

You see it on sdlookup and are justifiably pissed.

I'm up in the LA foothills and I've seen several sketchy deals.
--One house was listed as a probate, with court confirmation required. We wanted to offer less tham 90% on the house, but were told the probate court would only take offers down to 90% and above.
Two weeks later, the property was sold to the listing agent's client for about 80% of the list--and suddenly no court confirmation was required.

--A Coworker tried to buy a soon-to-be foreclosed home out in the desert. The listing agent (they were trying to sell the house before foreclosure) did not accept the offer, the home was foreclosed, but the listing agent agreed to "help" with the auction. My coworker offered $150k, but the house was auctioned for $110k--strange. Two days later the realtor offers to sell my coworker the property for $130k. Turns our his business had the winning bid (which was lower), and offered to split the savings with my coworker!

--A current REO has been sitting on the market for 64 days. I've called the listing agent and her office several times over the past three weeks--no reply. My realtor--ditto. I am waiting to see if she picks the place up for a song--I would not be surprised.

I'm sure each of these could have a purely legitimate explanation, but I've learned not to have THAT much faith in humanity or realtors ;^p

I like that you distinguish realtors from humanity.

I have always suspected that I was "different".

Hmmmm

Hmm, I just wonder....

1)Overbid everyone else by 20%-30%
2)Go into escrow
3)Wait for the appraisal to come down to earth price X
4)Once the seller agrees to X, tell the seller you are going to walk unless you get appraised price minus an additional -5%?

So in your example, even when the bank says $302, you tell them, sorry It's $290k now or have fun going back to the start.....Hmmm. I wonder.

That's a great strategy. I'm going to keep that in mind when I make an offer.

Great unethical strategy. You people are going to say that you are only kidding right?

I think the additional drop would be a hard sell and not within the original contract contingencies.

Maybe other people have had other experiences?