Foreclosures/ Bank Owned Category
Buyer Expectations For Foreclosures Will Cost Many Money!
April 8th, 2009 Categories: Brandon, First Time Home Buyers, Foreclosures/ Bank Owned, Riverview
Recently I had a buyer find a house they wanted badly. The house was a foreclosed property and had been on the market for a while. The bank had originally listed the house for $159,900. It was not a house that I recommended to my buyer clients at that price.
After roughly 30 days, the bank dropped the price to $139,900. Better, but I continued to feel it was not priced properly. After 80 days, the house was re-priced to $119,900. Another $20,000 decrease. At this time I thought we had a property to market. I sent the listing information to several of my clients and I got a phone call requesting a showing. At the same time, I selected 3 more foreclosures I thought were of good value and scheduled showings.
Sure enough the client and his wife loved the property. I pointed out that the roof would need replacing and that could give us a little additional room to negotiate. I suggested we price in down by twice the cost of a new roof and be happy if we are met half way.
My client insisted that we offer in the $80’s and pay no more than $95,000 because of the repairs required on the house. I immediately searched for a foreclosed house that was pristine, in his price range. I found a two year old home described as “barely lived in and with upgrades galore.” Yes, he and the wife loved it. Basically a new roof and new everything. It was the same size house and listed at only $11,000 above the older “needs repairs” house.
What was he willing to pay (not offer, but pay)? “No more than $100,000.”
That led me to provide him a study to share with all buyers in the market for a foreclosed home.
This study was based on homes listed in Riverview and Brandon Florida for a list price between $90,000 and $150,000 since the beginning of 2009. Here is what we found.
|
List Price |
Sold Price |
Price p sq ft |
% Ratio |
DOM |
|
$120,660 |
$119,247 |
$74.83 |
97% |
48 |
List price is the final list price on MLS
Sold price is what the buyer actually paid
% Ratio is the ratio of the list price to sold price. (Based on actual square footage prices)
DOM is Day On Market
What do these numbers tell us?
Banks on most of the properties are getting their price. List price decreases with Days On Market, but does not necessarily open the door for further price reductions. Price per square foot is a starting point to understand value, but not the final point. Property condition, neighborhood, supply and other attributes help to determine price.
What can the buyer walk away with regarding this information? First, don’t set yourself up for disappointment after spending a lot of time finding the right house and lose your excitement or the home by unrealistic expectations. Banks are not desperate as we all may think or as the media reports. In the study area 41% of all sales were bank owned properties that closed on average 48 days or less. That is a hot market for the banks and they don’t need to come off their price except on very special circumstances. Your real estate agent can help you understand those circumstances.
We have specialized in finding great foreclosed properties and will gladly find or review foreclosures for you. Give us a call or email us.
If you would like a copy of this stuy in Excel spreadsheet form let us know. It contains each and every foreclosed property in Brandon and Riverview along with the list price (study price of $90,000 to $150,000), sold price and days on the market as well as other helpful information. Drop us an email and request “Foreclosure Study 1/1/09 to 4/8/09. We will be glad to send you the report.
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Foreclosure in Valrico FL 2200 Square Feet $137,500
April 6th, 2009 Categories: Foreclosures/ Bank Owned, Real Estate Investment, Valrico
As a new service provided here at Diamond Dwellings in Brandon, we are already seeing ways to change our service. First we will be inlcuding the date posted in the body of the blog. Foreclosures are selling quickly right now. For example our previous post still on our site has a contract pending. We are looking at ways to update the video to show that the property is not longer available.
Feedback has been positive on our rating system of “A Real Gem, A Diamond in the Rough and A Lump of Coal” and we will continue to give them a rating, but remember the value of a diamond is in the eye of the beholder.
Today’s property has been on the market, but has been drastically reduced by the lender and that is what caught our eye. This listing began at $169,000 was quickly reduced to $147,000 and now sits at $137,500. For a tour of this home, please take a look at this 6 minute video.
As of this posting 4/6/2009 the following property is still actively listed.
Please enable Javascript and Flash to view this Viddler video.
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Complete Rehab of Apollo Beach FL Home Under $100K!
March 31st, 2009 Categories: Apollo Beach, Credit & Financing, Foreclosures/ Bank Owned, Real Estate Investment
The market has started to heat up even further for foreclosures in the last 30 days. And why not? Foreclosures, also known as bank owned property, offer all price values of homes in all kinds of conditions. Diamond Dwellings in East Hillsborough County covering Brandon, Valrico, Riverview, Apollo Beach and surrounding communities such as Lithia has started to rate our reviewed foreclosure discoveries in three categories as follows:
Gem Dwellings: Houses in this category are either in move in condition or close to it. Most likely the buyer will choose to do some interior painting and carpet cleaning, but other than that or some small alterations by preference, these properties are ready for a new resident.
Diamond Dwellings in the Rough: These homes are rated as a good buy based on area comparables, but will require some minor to major repairs. Examples of minor may be some dry wall repair, medium expense could be a new air conditioner and major expense could be a new roof. Some buyers would walk away from these houses, but others would have the vision to repair or update the home with a rehab loan such as the FHA rehab loan.
The final category would be Lump of Coal Dwellings: These homes are still worth considering, but would require careful consideration and due diligence. They are distressed homes that would likely require a buyer that knows what they are getting into and would work with our agents to negotiate a greatly discounted price in order to bring this property into occupancy status. These homes would likely be of more interest to our investor or contractor clients. They will require some major re-construction of the property.
We are introducing our home review with a home in Apollo Beach, Florida. Apollo beach is located southeast of Tampa and only a few miles southwest of Riverview. This home is a little more than 1300 square feet and is a 3 bedroom 2 bathroom home located close to many water activities that include a beach, boat ramps and marinas.
Please take a look at this 6 minute video of this foreclosed property:
This property now has a pending contract effective 4/5/2009
If you would like to take a look at this property please give me a call at 813-653-1241.
Rick Frissell - Diamond Dwellings Realty.
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Do it yourself or Hire a Pro: Fixer-Uppers offer Opportunity
February 22nd, 2009 Categories: Credit & Financing, First Time Home Buyers, Foreclosures/ Bank Owned
The oft heard phrase “Buyer Beware” is never more appropriate than when considering the purchase of a fixer-upper.You really need to know exactly what you’re getting into before buying.
It’s commonly believed that fixer-upper properties represent easy money that is ripe for the taking – that you can buy it, do a little work on it in your spare time, and then resell quickly for a large profit. Usually, this simply isn’t the case. Although, with proper planning and foresight, good profits can be made by buying “distressed” properties at less than market value, making appropriate improvements and repairs, and then reselling. And for many first time buyers who intend to live in the house while working on it, buying a fixer-upper can be the very best option. It’s less risky buying a fixer-upper when you can live in the house while fixing it. And of course, by living in the house for at least 24 months you should be able to avoid paying regular income taxes on the profits. Read the rest of this entry »
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Brandon Florida Bank Owned Properties- AKA Foreclosures
January 15th, 2009 Categories: First Time Home Buyers, Foreclosures/ Bank Owned, Real Estate Investment
Buying Brandon Area Bank Owned Properties
There is a lot of interest in buying bank owned properties in the Tampa Bay Area these days. A lot of information, some good and some bad, is floating around about the subject. Often the information offered is for sale, with the promise that you can make a lot of money with little effort once you know “the secret formula”. The fact is, you can make money buying foreclosures and short-sales, but that there are no secrets, and to make money does require effort.
What’s an REO?
REO stands for Real Estate Owned. These are properties that have gone through foreclosure and are now owned by the bank or mortgage company. This is not the same as a property up for foreclosure auction. When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. You must also be prepared to pay with cash in hand. And on top of all that, you’ll receive the property 100% “as is”. That could include existing liens and even current occupants that need to be evicted. An REO, by contrast, is a much “cleaner” and attractive transaction. The REO property did not find a buyer during foreclosure auction. The bank now owns it. The bank will see to the removal of tax liens, evict occupants if needed and generally prepare for the issuance of a title insurance policy to the buyer at closing. Do be aware that REO’s may be exempt from normal disclosure requirements. In California, for example, banks are exempt from giving a Transfer Disclosure Statement, a document that normally requires sellers to tell you about any defects they are aware of. Read the rest of this entry »
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