A lot of homeowners in Jacksonville have opted to sell their homes via a short sale transaction in order to avoid foreclosure. One homeowner sold her home at half of what it was currently valued at and was relieved that the lender forgave almost $76,000 in mortgage debt. Obviously, the owner was thankful that she could start over a new chapter of her life without having a huge debt to worry about.
Distressed sales, which include both foreclosure and short sales, have increased dramatically since January 2008. For that period, only 10 percent of the total home sales activity involved distressed houses. But for the current year, based in the information gathered by the Northeast Florida Association of Realtors, it soared to 49 percent.
Effect of Distressed Sale on Median Prices
As the number of short sales and foreclosure sales grew, median sales prices have started to decline. This, of course, is understandable as distressed sales usually mean steeply-discounted real estate properties. As a result, the growing popularity of short sales and foreclosure sales will only serve to remind the public that market conditions have yet to stabilize. For sure, the days when it is possible to own a home with zero-down payment are long gone.
Effect on Realtors and Agents
In addition to this, it can also be observed how agents and Realtors have adapted to the changing needs of their clients. New skills are needed as well as a better understanding of what is involved in these distressed sales. Most are having a hard time handling such transactions. But because of their need to make a living, many have accepted the fact they need to make adjustments. In fact, national certifications are being given to those agents or Realtors who choose to become expert in short sale transactions.
Effect on Underwater Homeowners
As for homeowners looking for a way out of their mortgage problems, especially those who found themselves with more mortgage debt compared to their home’s market value, a short sale is the only option which will provide them with a better outcome. There would be less damage to their credit scores, no foreclosure entry on their credit history and most important, eliminated debt (i.e. if the lender agrees to waive their right to deficiency judgment).
Of course, all this is possible with a professional and reputable Florida short sale specialist by your side.
Reference: http://jacksonville.com/business/2010-08-08/story/first-coast-housing-market-battered-short-sales
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