Special offer

Why List A House at a Price The Bank Won't Take?

By
Real Estate Agent with RealtyOne Group CABRE 01888059

San Ramon Short SalesI understand the listing agent's job is to list a short sale below market in order to attract offers and stop the pending foreclosure. That seems reasonable to me, even though it is confusing to potential buyers who think they are getting a whopper of a deal. Only to be disappointed when the bank counters at market price and the buyer can't or won't accept. Of course, an astute buyer's agent will have shown the buyer comps for the area and prepare them for the increase in the offer (maybe).

When this happens the property comes back on the market. My question-- why does the listing agent who knows the price the bank will accept, put the property back on the market at the ridiculously low price when first listed?

This just happened and I had two buyers call me because they were so excited with the list price of the home. After a conversation with the listing agent I gathered the facts. The price was actually $141,000 below the what the bank was willing to take, which no longer looked like such a deal.

I am sure there is a rational behind this, yet I can't see it.

Comments (5)

J. Philip Faranda
Howard Hanna Rand Realty - Yorktown Heights, NY
Associate Broker / Office Manager

That makes no sense. Unless it is a HAFA short sale where the bank gives a number, the best we can do is price accoring to comps. But to go below market that way is no service to the client. 

Jan 31, 2012 01:59 PM
Mona Gersky
MoonDancer Realty, Dillsboro,NC - Sylva, NC
GRI,IMSD-Taking the mystery out of real estate.

That really is very confusing and seems like a tremendous waste of time for all parties concerned.  Not only does it hurt both buyers and sellers, it doesn't seem like it would benefit the note holder either.

Jan 31, 2012 02:15 PM
David Cournoyer, Jr.
Warwick, RI

It doesn't make much sense to me. It sounds like someone, maybe the seller sold bad advice to the listing agent thinking that it would generate more interest because of such a low listing price? It's not a very professional thing to do in my opinion and it's the listing agent who should be responding to the owners and mention all the negatives of such a move. I agree with you Linda and everyone, why oh why?

Jan 31, 2012 02:23 PM
Todd Clark - Retired
eXp Realty LLC - Tigard, OR
Principle Broker Oregon

When my team lists a short sale, we actually start at the high end of the market and work down to a point where we get showings and offers. This gives us a record of price reductions, showings and offers to prove to a bank that we have done our best to get them the highest price. I think agents that start low just to get a quick offer and work upward to a banks BPO are foolish!

 

Feb 01, 2012 04:36 AM
Michelle Gibson
Hansen Real Estate Group Inc. - Wellington, FL
REALTOR

Linda - I rarely pay attention to asking prices especially since some are super low and some are super highly, the proof is in the comparables.

Feb 02, 2012 11:01 AM