If you run your business in Florida, Arizona or California, you understand Foreclosures!
Brevard County, considered one of the worst if not the worst Real Estate market in the country, is experiencing a tremendous amount of Foreclosure action. Currently half or more of the homes we are selling are Foreclosures.
Foreclosures are similar to the way it was back in 2001 and 2002. At that time you could get homes at close to 50% of their value. Now you can get homes that are 50% of what they sold for three years ago. However, with these great deals, comes a tremendous amount of competition. Not only do we have investors trying to pick up great deals, we also have many first time homebuyers and other buyers who were priced out of the housing market a few years ago.
Almost every home we make an offer on has multiple bids. Like the buying frenzy of 2004, we are seeing similar situations with Foreclosures in this market. With that said, if you are looking to buy a Foreclosure and have your heart set on a home, you should always bid your highest and best offer. Almost every Foreclosure we have sold recently has been sold at or higher than full price. How have we become good at selling these...we have lost a ton of them before we figured it out. We now educate all our buyers with the Forclosure Notice below:
How to buy Foreclosures in the current Real Estate Market November 2008
The 2008 Foreclosure Market in Brevard County Florida has some of the frenzy that was creating in the buying frenzy of 2004. Most Foreclosures are selling at close to 50 and 60 cents on the dollar from their highs of three years ago. As your Realtor, it is our duty to explain to you the best way to reach your goal of buying a foreclosure.
- Be sure your Realtor has placed your criteria into our Foreclosure Automatic Update System.
- Both the Agent and you, the buyer, will need to have a quick response attitude if you really want this home. These listings are going extremely quickly and if you are not quick, there will be multiple offers.
- It is the Listing Agents responsibility to present all offers to the bank or the seller. Therefore, when making your offer, be sure this is your highest and best offer.
- Prices of foreclosures are not very negotiable. Especially the aggressively priced listings. They sell quickly and at or higher than full price.
- The winning bid will almost always be full price or higher. If you really want a house, we would recommend bidding at least 5% or even 10% higher than the asking price. In most situations there will be multiple bids. Smart investors who realize how far down the prices of these homes have come, are jumping on the great deals. Almost every foreclosure is priced at their low.
- When making the offer, the less contingencies the better. It is unlikely the banks or corporations that own these properties will entertain paying closing costs or any other concessions.
- If you are financing, FHA loans are a more difficult on Foreclosed Homes. Many Foreclosed Homes have damage that may not be acceptable to FHA inspectors. Since these homes are all sold as is; the banks will not contribute any money to fix the home.
Our goal at Tropical Realty is to get you the best possible deal.. However, we also understand what is going on in the Foreclosure Market. Almost 70% of the homes we currently sell are Foreclosures. We understand them. Our goal is to not only get you excited about finding a property but also to give you the knowledge to be the winning bidder on your desired home!
As always, we look forward to helping you!
Thank you for the information. These homes seem to be the draw everywhere-even in the Midwest. It is hard to convince buyers to make an offer that is higher than what the bank is asking, but it is necessary on the properties that can be gems when they are repaired.
No problem. I find that the biggest mistake Realtors, including mine, make is not educating their customers enough. When short sales starting invading our space (and they are still huge here) we had to come up with an education sheet for them. The reason I put it in writing is so the customer can't come back to the Agent saying "you never told me". You can't go wrong if you do your best to educate. If your customers won't follow your advice then you have to decide if you want to continue writing offers 20% below asking price. When I started in Real Estate, I worked with a few investors. They had me writing 20 offers to find one house for $50k. I realized after a few months that I would never make it in this business if I let them run my business. I took over my business and the rest is history!