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SD Realtor
Participantozz you and me would be competing for the same home if west side of neptune hits 600k!
SD Realtor
ParticipantThe retraction is not impending. It is here so I would use the term current retraction. It will continue for a few more years.
Financially the best way to protect against it would be to not purchase if you can hold off. Even holding off another year or two may save you a good chunk of change. Many on this board forecast a large drop in the median in the next 12-18 months. I think there is a possibility of that to happen but real estate moves slow… really slow. However you never know. Alot of data seems to support a chunk downwards… I think certain segments can and will chunk down but I am not so sure more desireable ones will chunk down in a 10-20% manner but ya never know! I am more of a longer protracted downtrend kind of guy. In the end we all are of the same opinion for where we will end up.
I know many people purchase homes other then for financial reasons. If this is the case then the best protection is to get the best deal you can. Lowball people, be very selective, do not overextend yourself…. etc. I believe condos will continue to depreciate at a higher rate then detached homes but on the whole everything will move down. You may want to think about value as well. Recurring fees such as Mello Roos and HOA are something you can choose to avoid but if you have your heart set on a new home, then these fees will be inherent in your purchase.
SD Realtor
ParticipantThe retraction is not impending. It is here so I would use the term current retraction. It will continue for a few more years.
Financially the best way to protect against it would be to not purchase if you can hold off. Even holding off another year or two may save you a good chunk of change. Many on this board forecast a large drop in the median in the next 12-18 months. I think there is a possibility of that to happen but real estate moves slow… really slow. However you never know. Alot of data seems to support a chunk downwards… I think certain segments can and will chunk down but I am not so sure more desireable ones will chunk down in a 10-20% manner but ya never know! I am more of a longer protracted downtrend kind of guy. In the end we all are of the same opinion for where we will end up.
I know many people purchase homes other then for financial reasons. If this is the case then the best protection is to get the best deal you can. Lowball people, be very selective, do not overextend yourself…. etc. I believe condos will continue to depreciate at a higher rate then detached homes but on the whole everything will move down. You may want to think about value as well. Recurring fees such as Mello Roos and HOA are something you can choose to avoid but if you have your heart set on a new home, then these fees will be inherent in your purchase.
SD Realtor
ParticipantThe retraction is not impending. It is here so I would use the term current retraction. It will continue for a few more years.
Financially the best way to protect against it would be to not purchase if you can hold off. Even holding off another year or two may save you a good chunk of change. Many on this board forecast a large drop in the median in the next 12-18 months. I think there is a possibility of that to happen but real estate moves slow… really slow. However you never know. Alot of data seems to support a chunk downwards… I think certain segments can and will chunk down but I am not so sure more desireable ones will chunk down in a 10-20% manner but ya never know! I am more of a longer protracted downtrend kind of guy. In the end we all are of the same opinion for where we will end up.
I know many people purchase homes other then for financial reasons. If this is the case then the best protection is to get the best deal you can. Lowball people, be very selective, do not overextend yourself…. etc. I believe condos will continue to depreciate at a higher rate then detached homes but on the whole everything will move down. You may want to think about value as well. Recurring fees such as Mello Roos and HOA are something you can choose to avoid but if you have your heart set on a new home, then these fees will be inherent in your purchase.
SD Realtor
ParticipantYou described a short sale as being painful? Can you describe a little bit more?
– I think I did in my previous post. If you have more questions I will post another example.
Say a home last sold for $3M (zero down) and is now an REO. Can I just offer $1M and let the offer sit there? how do I even make an offer?
– Yes you can make an offer. Any qualified realtor can work with you to do this. Or you can find who is listing the home and call them up. Most REO properties (bank owned) have realtors/brokers representing them. Lenders do not sell directly for liability purposes.
SD Realtor
ParticipantYou described a short sale as being painful? Can you describe a little bit more?
– I think I did in my previous post. If you have more questions I will post another example.
Say a home last sold for $3M (zero down) and is now an REO. Can I just offer $1M and let the offer sit there? how do I even make an offer?
– Yes you can make an offer. Any qualified realtor can work with you to do this. Or you can find who is listing the home and call them up. Most REO properties (bank owned) have realtors/brokers representing them. Lenders do not sell directly for liability purposes.
SD Realtor
ParticipantYou described a short sale as being painful? Can you describe a little bit more?
– I think I did in my previous post. If you have more questions I will post another example.
Say a home last sold for $3M (zero down) and is now an REO. Can I just offer $1M and let the offer sit there? how do I even make an offer?
– Yes you can make an offer. Any qualified realtor can work with you to do this. Or you can find who is listing the home and call them up. Most REO properties (bank owned) have realtors/brokers representing them. Lenders do not sell directly for liability purposes.
SD Realtor
ParticipantOne thing that has been irritating to me is that many homes that have been foreclosed and returned to the lender have been put back on the MLS but not priced to sell quickly. So these homes sat on the market for months, did not sell, then got pulled entirely off the market. Some of these then went to the private auctions. So that is what I mean by some of the auctioned properties already went through an MLS cycle.
Hopefully now as more homes get foreclosed they will be put on the MLS with a more aggressive price strategy.
Short sales are a pain… well the problem is that you have two parties you negotiate with, the seller and the lender. When you purchase a short sale you are at the mercy of the lender. So imagine Joe homeowner who is selling his home for 500k but owes 600k on it. So you submit the 500k offer and Joe says yes but you need to hear back from Joes lender as well. If both do not agree to the sales price then your offer cannot be accepted. Also the lender tends to take their own sweet time. For instance I have a seller who is selling his home short. The lender has already told me it will take 2-3 WEEKS to respond to any offer. Some lenders work faster then others but this is an example that is true to life.
In your example I was a little confused. If the property is an REO then the bank already owns it. You submit your offer directly to whoever is representing the bank. (Banks usually enlist brokers or realtors to sell the home) so you can offer whatever you want to offer. However if the property is an REO there is no outstanding loan on the property.
If the home is still owned by the homeowner and they owe 500k and you offer 400k and the seller CANNOT make up the 100k difference then the seller needs to work with the lender to see if the lender will ACCEPT a short sale. It is not a matter of the seller just saying “hey lender this is a short sale”. The seller must provide documentation and proof that there is a hardship situation. It is a pain in the butt paperwork wise. The entire documentation package includes tax returns, letter of hardship, salary verification, statements of net worth, etc…If the lender believes the documentation then they may grant a short sale if they believe they cannot get a better price through foreclosure and selling it themselves.
Hope this helps.
SD Realtor
ParticipantOne thing that has been irritating to me is that many homes that have been foreclosed and returned to the lender have been put back on the MLS but not priced to sell quickly. So these homes sat on the market for months, did not sell, then got pulled entirely off the market. Some of these then went to the private auctions. So that is what I mean by some of the auctioned properties already went through an MLS cycle.
Hopefully now as more homes get foreclosed they will be put on the MLS with a more aggressive price strategy.
Short sales are a pain… well the problem is that you have two parties you negotiate with, the seller and the lender. When you purchase a short sale you are at the mercy of the lender. So imagine Joe homeowner who is selling his home for 500k but owes 600k on it. So you submit the 500k offer and Joe says yes but you need to hear back from Joes lender as well. If both do not agree to the sales price then your offer cannot be accepted. Also the lender tends to take their own sweet time. For instance I have a seller who is selling his home short. The lender has already told me it will take 2-3 WEEKS to respond to any offer. Some lenders work faster then others but this is an example that is true to life.
In your example I was a little confused. If the property is an REO then the bank already owns it. You submit your offer directly to whoever is representing the bank. (Banks usually enlist brokers or realtors to sell the home) so you can offer whatever you want to offer. However if the property is an REO there is no outstanding loan on the property.
If the home is still owned by the homeowner and they owe 500k and you offer 400k and the seller CANNOT make up the 100k difference then the seller needs to work with the lender to see if the lender will ACCEPT a short sale. It is not a matter of the seller just saying “hey lender this is a short sale”. The seller must provide documentation and proof that there is a hardship situation. It is a pain in the butt paperwork wise. The entire documentation package includes tax returns, letter of hardship, salary verification, statements of net worth, etc…If the lender believes the documentation then they may grant a short sale if they believe they cannot get a better price through foreclosure and selling it themselves.
Hope this helps.
SD Realtor
ParticipantOne thing that has been irritating to me is that many homes that have been foreclosed and returned to the lender have been put back on the MLS but not priced to sell quickly. So these homes sat on the market for months, did not sell, then got pulled entirely off the market. Some of these then went to the private auctions. So that is what I mean by some of the auctioned properties already went through an MLS cycle.
Hopefully now as more homes get foreclosed they will be put on the MLS with a more aggressive price strategy.
Short sales are a pain… well the problem is that you have two parties you negotiate with, the seller and the lender. When you purchase a short sale you are at the mercy of the lender. So imagine Joe homeowner who is selling his home for 500k but owes 600k on it. So you submit the 500k offer and Joe says yes but you need to hear back from Joes lender as well. If both do not agree to the sales price then your offer cannot be accepted. Also the lender tends to take their own sweet time. For instance I have a seller who is selling his home short. The lender has already told me it will take 2-3 WEEKS to respond to any offer. Some lenders work faster then others but this is an example that is true to life.
In your example I was a little confused. If the property is an REO then the bank already owns it. You submit your offer directly to whoever is representing the bank. (Banks usually enlist brokers or realtors to sell the home) so you can offer whatever you want to offer. However if the property is an REO there is no outstanding loan on the property.
If the home is still owned by the homeowner and they owe 500k and you offer 400k and the seller CANNOT make up the 100k difference then the seller needs to work with the lender to see if the lender will ACCEPT a short sale. It is not a matter of the seller just saying “hey lender this is a short sale”. The seller must provide documentation and proof that there is a hardship situation. It is a pain in the butt paperwork wise. The entire documentation package includes tax returns, letter of hardship, salary verification, statements of net worth, etc…If the lender believes the documentation then they may grant a short sale if they believe they cannot get a better price through foreclosure and selling it themselves.
Hope this helps.
SD Realtor
ParticipantCurrently active at 2.5M and on the market for 152 days. Not sure where you saw the 4.5M but the original list price when it came on the market was 3.9M and it was listed on 3/27/07. Perhaps it was listed before that at 4.5M but I didn’t find it in my search. I typed Old Winery in the street name and searched from there. So maybe I missed it.
They bought the home for 1.65M in July of 04. I don’t know the original financing on it but they have a recording on 10/05 for 170k, then another for 360k on 11/05 then another for 1.8M on 11/05 and then another for 990k on 11/30. The timing of the refinances appears to indicate that they were pulling some hanky panky on the lenders.
These people will easily loose their home and the lenders will have seen a million bucks evaporate.
SD Realtor
ParticipantCurrently active at 2.5M and on the market for 152 days. Not sure where you saw the 4.5M but the original list price when it came on the market was 3.9M and it was listed on 3/27/07. Perhaps it was listed before that at 4.5M but I didn’t find it in my search. I typed Old Winery in the street name and searched from there. So maybe I missed it.
They bought the home for 1.65M in July of 04. I don’t know the original financing on it but they have a recording on 10/05 for 170k, then another for 360k on 11/05 then another for 1.8M on 11/05 and then another for 990k on 11/30. The timing of the refinances appears to indicate that they were pulling some hanky panky on the lenders.
These people will easily loose their home and the lenders will have seen a million bucks evaporate.
SD Realtor
ParticipantCurrently active at 2.5M and on the market for 152 days. Not sure where you saw the 4.5M but the original list price when it came on the market was 3.9M and it was listed on 3/27/07. Perhaps it was listed before that at 4.5M but I didn’t find it in my search. I typed Old Winery in the street name and searched from there. So maybe I missed it.
They bought the home for 1.65M in July of 04. I don’t know the original financing on it but they have a recording on 10/05 for 170k, then another for 360k on 11/05 then another for 1.8M on 11/05 and then another for 990k on 11/30. The timing of the refinances appears to indicate that they were pulling some hanky panky on the lenders.
These people will easily loose their home and the lenders will have seen a million bucks evaporate.
SD Realtor
ParticipantHi Lloyd,
Short sales are really a chore. I would agree to wait for REO properties. Any home that is at any of the third party auctions are all REO properties that have already passed through the foreclosure process and are lender owned. The homes at the last auction seemed to sell at lower prices then the homes at the auction in June. However if you reviewed all of the San Diego homes at both the August and June auctions, there were very few properties in desireable areas.
Hopefully that will change, OR the lenders will market them appropriately when they put them on the MLS the first time. Most of the properties at these auctions have already been through MLS cycles.
If you are going to purchase at auction do ALL OF YOUR DILIGENCE BEFORE YOU GO TO THE AUCTION.
SD Realtor
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