I read a lot of advise on the Internet about how to get a deal or a steal on an REO...a bank owned home.The problem is that most of it is not correct for our local market here in Redding California.I read where you should be able to offer the bank 5-10% below the asking price and you should be able to take the home off the banks hands....banks hate to own real estate.
The last part is true...banks don't like to own real estate...fair enough but getting a REO under what the bank is asking is the hardest part.Why you ask? Well for the vast majority of REO's right now in Redding that are in a good area,in good condition AND priced at or under $200k there are Multiple offers....Yes Multiple....
You see I haven't read about THAT in any articles on the Internet or in the Newspaper? There seems to be a black hole on what is actually happening in this market segment.
I had some clients in the recent past that wrote an offer on a REO...they make their offer $20k BELOW what the bank had the property priced at....They didn't get it...I even suggested they go much higher but they didn't want any part of that advice! They were upset and called and asked WHY they didn't get the home???
The answer-YOU GOT BLOW OUT OF THE WATER!!! THE HOME SOLD FOR OVER THE LISTED PRICE!!! Pretty simple deal....but they thought they should have been able to steal the home for way under the listed price....mmmm Wonder where they got that idea?? They just knew that it couldn't be right that they did not get it for their price....
Well long story short we parted company...and that is OK...as it was frustrating to work with someone that came across as knowing more about real estate than I did.They thought something was fishy with the deal....no not fishy at all....you got blow out of the water on your price that's all.....
This is a prime example of theory....see theory right now states that it is a Buyers market and theory would have one believe that you can steal a home...and there are some out there that you can get for 15-25% off....Now REALITY...you have to know which ones those are....and if your Theory is wrong on any particular home you will experience what these nice folks did....BAM....you will get blown out of the water...writing an offer that will be trumped by even the novalist investor....
Investors are coming back into the local Redding California market right now...and getting a nice REO that is priced right for a song....well that is Theory....Reality is that you will be competing again 4-15 others if indeed the home is priced right and is in a good area....
The same things hold true and always will ... LOCATION,LOCATION,LOCATION.....
For the REO's in the best locations??? Any guess if ones theory of stealing it will hold water?
To knowing the steals and deals from the dogs and the Frogs!
Regards
Rick Goates
Eco Broker
Redding Ca
96001
530-248-5627
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