I read through this whole thread, but IMO what was missed is: it’s always about price.

[quote=sdrealtor]Just thought I’d share an experience from the field. An REO popped up in my submarket at $1M. My estimate of value on it is somewhere between $1M and $1.2M. One of my clients submitted an offer on it. I just spoke to the listing agent and we were the 16TH offer in.[/quote]

I know that property. It was a short sale in Olivenhain for 6+ months, finally foreclosed. One reason there were 16+ offers was the listing agent did a great job of building buzz. He listed it at 999k (cheap for the area) and put up flyers saying “house will be sold to highest bidder in 14 days.” It worked, apparently.

I’m one of the people mentioned in this thread that makes over 200k and has 300k cash down, so I’ve been in all those areas. I’ve found several properties in nice areas (Del Mar, Solana Beach, RSF) that have been sitting on the market for 150+ days. Each of them is worth about 20% less than listed (due to condition, etc), so they’re ripe for lower offers. Many have not received a single offer.

The problem with many of these is that they’re carrying a ton of paper. Some have been refi’ed by the trustees; eg, Mom and Dad left the kids a nice home by the beach, and they used it as an ATM. So they can’t “afford” a lower offer, because they would have to bring cash to the table (which they don’t have). My guess is they’ll become REO’s in the near future.

But if it’s a good price, it’ll move, which was sdr’s original point.