ocrenter’s story, Bankers in Trouble, highlights a new problem I had not considered: banks competing against each other for sellers. How low will they go? Without the emotional attachment to the asset they are selling, will they list at market prices?
Lending institutions are not in the business of managing rental properties. When they foreclose the clock starts ticking and they have to sell the asset off. If a market segment racks up enough REOs (banking jargon for “Real Estate Owned”) they absolutely do drive the pricing trend for the remaining sales because they represent the alternative and they are the competition. When two lenders compete against each other the one with the shortest fuse will get discounted the most because there are no options for them.
“Lending institutions are not in the business of managing rental properties.”
which explains the yellow lawn and the dead tree in the front yard. too many of these and the neighborhood start going downhill. Could communities such as Aliante and Queen Creek end up being the Lancaster of this bust?
bugs, what about areas in SD with a lot of foreclosures, like San Elijo, do you see problems with the neighborhood going sour?
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