Anyone listing and selling real estate, whether agent or owner/buyer can tell that foreclosures are affecting property values. Certainly this begs the question, isn't it in the banks' best interest to get top dollar for their inventory?
The answer may surprise you!
Recently I was in contact with a local appraiser who expressed his frustration at what he referred to as two sets of data. The first is normal sales between a willing buyer purchasing from a willing seller and the other is bargain hunters buying up foreclosures. The problem is that, as foreclosures become a larger percentage of the market, the appraisers cannot ignore such a large portion of the comparables. Unfortunately at this point the banks are dealing with such a large number of REO's and short sale requests that they're choosing to fire sale the foreclosures. Most are getting BPO's from local agents and deducting 15% for a quick sale. Of course this hurts the seller who has a job transfer or especially those who may want to downsize.
So what's the solution? If you are thinking of a move and have a house to sell you may want to wait a bit. The exception to this is the move up market. If you want to move for instance, from a townhome to a single family this is the perfect market of you. If you take a hit on your townhome to sell and negotiate a similar percentage hit on the single family you're money ahead.
Of course the best scenario in the current market is to be a first time buyer. You have the $8,000 tax credit if you settle before December. You can usually negotiate some closing help from sellers in this market and rates are great.
All in all, this too shall pass. Our market is and always has been cyclical. The one think we can count on is that change is coming.
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