The real estate market these days is constantly changing. Today’s market is a strange one. There are always really good deals to be found, but because of the current explosion of buyers on the market, they can be difficult to find. There are a few ways to get a real steal in real estate.
There are two types of sellers that will often sell property below market value; banks and estates.
Purchasing a property owned by a bank can be difficult and stressful, but the rewards are high. First of all, be aware that these transactions could take more than a couple months to get accepted and closed, so if you want to get the tax stimulus, you will have to close by December 1st, 2009. You will want to get started immediately, because you may not find a deal on a home you are interested in for some time. There are two types of bank-involved properties you can purchase, bank owned and short sales.
Purchasing REO (Bank Owned or Foreclosed Properties)
With REO homes, you will want to watch the market very, very, very, very closely. Look at all the new listings that come up every day in your desired market. A good real estate agent can help you with this by sending them to you in an email or other format. As soon as one pops up that you might like, take a look at the property that day if possible. If you like it, put an offer on the property that same day! When an REO property gets on the market, there are usually multiple offers on the first or second day if it’s priced well.
Not all REO properties are listed below market value, but it does happen when the bank wants a quick sale. An agent can help you identify a well priced listing. You will want to make your best offer up front because if you try to get an even better deal, you may get outbid. You might consider giving an offer at or over asking price to help improve your odds of winning. It can take a few days to a few weeks to hear back on an accepted offer, so break out the nail file, it’s going to be a stressful wait.
Purchasing Short Sales
A “short sale” is when the owner of the property owes more on the home than what it’s worth and they need to sell it, for whatever reason. The bank they are borrowing from has to get involved and approve the purchase price. We are running into these more and more these days.
My brokerage has many short sale listings and we understand the process involved. These banks all handle short sales differently. Some lenders aren’t even accepting offers at the listing price or even contacting the seller for nearly a year about a submitted offer. An agent that works with these entities are aware of which ones are better to deal with. Keep in mind that multiple offers can be submitted on the property while awaiting acceptance.
If you get outbid on a property, don’t be discouraged, an even better deal could make it’s self available. You may want to keep an eye out for another property while waiting to hear back, you can always rescind your current offer and place a new one on a different property.
An estate sale is when heirs have gained ownership of a property for many reasons including when a parent passes away or moves to assisted living. Many times the property has a lot of equity since it was lived in and paid on for many years, allowing an aggressive listing price. The heirs may wish to have a quick sale so they don’t have to make payments on the property. These sales are usually a lot easier to deal with than banks. A great way to get a good deal at an estate is to purchase it at auction. An auction requires a down payment. A real estate agent can help you find and buy at auction.
While the other types of sales do produce good deals on properties, you will want to work with a buyer’s agent that can keep you informed on the market and help you recognize value.
Give me a call if you are looking in Stark or Summit County, Ohio to get started today! 330.412.2221