THE SILVER LINING FOR BUYERS and SELLERS 

In tough times, the tough get going!!!

MORE EXPERIENCED AGENTS- Those of us who are still actively working full-time in the real estate market are working hard and expanding our knowledge.  For me, I spend many hours a day doing BPO's, CMA's, and talking to Buyers, Banks, and Asset Managers.  We spend time finding out what a short-sale entails(hours on the phone with Banks), what REO properties require to obtain the acceptance. This provides knowledge in the value of homes relating to key information for Buyers to make an informed decision. Many hours are spent reading market reports and changes in loan programs.  We are educating ourselves. We know what products best fit each Buyer, Seller, and Bank Owned Properties.

PERSEVERANCE - Agents who go the extra mile for their Buyers and Sellers.  Commitment to our clients spending many hours finding the Buyer the right home  This also provides Buyers and Sellers key information to make an informative decision.  Working this market takes pain staking hours keeping informed about changes and trends.

TRUSTWORTHINESS- Those of us who are committed during this time are in it to stay and build a good reputation in the industry.  We provide relevant information and commitment to our clients.  Hardworking commited Agents who know what it takes to get things done.  I believe the Agents left standing (for the most part) will be well informed, educated, committed, and stronger.

This post is dedicated to the Agents who are working in the trenches providing help to Sellers get out of a bad situation, selling off inventory for the Banks, and informing the public.

I am writing this article because I run across many lenders who want value for their deliquent loans, but seem to still think that an appraisal or a BPO with  90 - 120 day value can be stated.  Most lenders still want you to state the 90-120 value higher than the 30 (fire sale) value.  Unfortunately, the property is worth more with a 30 day sale versus a 90 or 120 day value. Does this not hold true even in a stable market???

Does an Appraisal show the true value in a declining market?  No,  I don't believe it does because an appraisal is based on sales, not current competition.  In a declining market, prices are falling...not staying stable or improving. More weight must be given on the current competition. 

Does a BPO show true value?  A "Broker Price Opinion"  which allows the Realtor to price a property based on recent sales and competition.  Hopefully, the Agent will price the property based more on competition.  With so many properties available for sale and more on the horizon to be marketed, one must price the property near the top of the active comparable pool.  If a property is priced 50th of its competition in a given area, what is the likelihood it will sell?

What is a comp? A comp is a comparable property for sale but also the current competition.  A comp must be close to the subject property in size, features, age, and size of lot.  We must  give credence to properties with additional features, size, and lot.  Some Banks may have a property with more features at a "reduced price" to get a quick sale.  Our searches must include additional areas outside the one mile radius.  I believe a buyer would be happy to pay less for a property with similar features in a similar area for less money.

I believe it is our responsibility to inform the Banks that a 30 day value is worth more than a 90-120 value in a "declining market".  It is also our responsibility to do a detailed search of current active properties with additional features and properties outside the given area that might be competition.  I have seen too many properties priced too high losing value during this marketing period.  If a property is priced correctly it will sell quickly for the highest price.

How many of you feel like Abbott and Costello?  Who's on First?

Who is first? The person to talk to for answers on short-sales.  Sometimes the bank will assign a Loss Mitigator who may or may not talk to you or may only post emails to the person you call and speak to over the phone.

What's on second?  What is going to be the price?  On a short-sale they won't tell you what to list the price at until you obtain an offer.  Then they will order an appraisal or BPO which could be overpriced because the person doing the BPO is not familiar with the area or hasn't done enough of them to know how to price property in a declining market.

I don't know?  I don't know when you will get an answer from the Bank but we are suppose to keep the buyer waiting to find out if they have bought a home even though they have to move in 30 days.

Why?  Why are the Banks making it so difficult to list and buy short-sales?  Isn't it saving them time and money to avoid foreclosure?

Thanks for letting me vent...