I was recently given a question to answer for our local Newspaper

By
Real Estate Agent with Coldwell Banker United, Realtors
Out of the blue, I was recently called by our local Houston newspaper because they found my website from a Google search - I was asked to write a response to the below question with 150 words or less.

This is what I'm thinking of sending them - Can you please weigh in?

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The question was:  

There are a lot of short sales on the market in some Houston communities these days, but do you think the average buyer is patient enough to wait through the short sale process to buy one?

My answer:

It depends on the posture of the buyer:

The fear of the unknown is for some more overwhelming than the patience needed to wait for a good deal.  Buying a property where a buyer might have to accept defects in the property, have no closing costs paid by the seller, no home warranties and no miscellaneous fees normally negotiated between buyers and sellers, are all items a buyer might not be willing to accept rather than the patience needed to close a short sale.  

My experience has been that patience is relative.   Most buyers who have the patience, funds and who want a home for a good value are not willing to take on the added issues associated with a short sale.  Normally buyers don’t have the patience to wait months and months to close on their new home unless they are financially handicapped and need to buy a home for less than market value.  The perfect short sale buyer is one who has no time constraints and is willing to be flexible in negotiaitons!

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Rainmaker
263,356
Kim & Kristine Halverson
Compass - Santa Monica, CA
Sisters, Realtors

I would add that there is an unspoken shelf life for buyers of short sales.  This is somewhere between 2.5 months to 3 mohths.  Which is usually when the home is almost approved for the short sale.  Kristine

Feb 06, 2011 04:27 AM #60
Rainer
177,904
Ann Wilkins
Golden Gate Sotheby's International Realty - Oakland, CA
Oakland, Berkeley, Piedmont CA

I represent buyers in about four short sales a year - they usually take 6 months from start to finish.  There is one positive aspect that hasn't been mentioned but in our market if a buyer has a FHA loan or a strict budget they are often left out in the cold.  One client's limit was $280,000 - every house we wrote on went way over asking and ending up in the $300K range.  We finally saw a short sale where the buyer had walked. Although they were in contract for $320,000 the house didn't appriase so the agent was happy to take our offer for $280,000.  With REO's we are often left in the dust by all cash buyers.  I find that the short sale sellers and their agents will often take the highest price.  My clients tend to be single female first time home buyers who have the patience to wait and are on month to month leases.

Feb 06, 2011 05:15 AM #61
Rainmaker
74,731
Mary Bowen
Coldwell Banker United, Realtor - The Woodlands, TX
Real Estate At Its Finest!!!

I find the most patient buyer in a short sale is the investor who doesn't plan to move in to the house and just sees it as one more transaction in his business portfolio.

Feb 06, 2011 05:36 AM #62
Anonymous
Robert Kuiper

Great answer Angela. Your answer is a short concise answer to most phases of the short sale question. Many buyer's have no idea what the term means, that alone how it will affect the negoiation process. I have had sales take up to 10 months to get closed, a time frame most buyer's do not want to live with. Make sure your name is included in the article's credits. Bob

 

Feb 06, 2011 05:38 AM #63
Rainer
39,726
Steve Thibault (T-Bow)
Century 21 Flagstaff Realty - Flagstaff, AZ
Flagstaff Real Estate

Nice answer and just a note your word count is 181? not sure if that matters.

Feb 06, 2011 05:47 AM #64
Rainer
116,518
Ric Mills
Keller Williams Southern Az - Tucson, AZ
Integrity, Honesty, and Vast Real Estate Knowledge

Short Sale buyers need the partience of "Jobe" and the time of "eternity".  However if it is thge right house many will wait.  Just make sure they can wait.  We have been very successful in getting Short Sales done and we get all closing costs paid.  We also get a home warranty in 90% of the cases.  it is all in how you right the deal.   If it is a low ball deal, you get nothing.  Make it a real serious and well investigated deal and everyone will be happy and you will get more closed.  Low ball offers in a short sale are a "solution to lose".  You might work low ball offers with REO's or regular sales, because you get immediate feedback.  They rarely work on a Short Sale.

Feb 06, 2011 07:21 AM #65
Rainmaker
1,630,473
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

Wait a minute... you didn't answer their question.

Do you think an average buyer is patient enough to wait?

You need to say yes or no - and here's why...

Feb 06, 2011 07:42 AM #66
Rainmaker
571,868
Bill Gillhespy
16 Sunview Blvd - Fort Myers Beach, FL
Fort Myers Beach Realtor, Fort Myers Beach Agent - Homes & Condos

Hi Angela,  very nicely written answer and I'm sure many will find it very helpful.  But... they asked if the average buyer.....  and I'm not clear on your answer.

Feb 06, 2011 08:35 AM #67
Rainmaker
67,119
Brenda, Ron, Lee Cunningham & Tara Keator
West USA Realty - Phoenix, AZ
Realtors, Homes for Sale - Phoenix Metro

Angela, I find that most buyers don't want to wait out the process since many homes don't get approved for a short sale after months of waiting.   It has gotten better.  One thing though: Most of the short sales I have done had the closing costs approved by the bank.  I always put in the offer that the closing costs has to be approved by the short sale lender as the seller cannot come out of pocket to sell (if it is my seller).  Usually they will allow 3%, occasionally they come back with another figure that is lower. 

Feb 06, 2011 09:08 AM #68
Rainmaker
1,639,443
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg Real Estate

I agree with Marte. You didn't answer the question. I don't think today's buyers do because .... personally I don't think that the hassle is worth the price.  Just buy another nice home of which we have plenty of inventory.

Feb 06, 2011 09:11 AM #69
Rainer
37,556
Kimberly Brandon
Smart Moves Real Estate - Venice, FL
Broker/Owner

statistically according to NAR the answer is no - but what fun would that article be to read.....

Feb 06, 2011 10:30 AM #70
Rainer
167,522
F U
nobody - Alamance, NT
Dead

I find its the bank were dealing with that will be the deciding factor. Some banks are much faster and better to deal with than others. There is no streamline still.

Feb 06, 2011 12:53 PM #71
Rainer
222,458
Jirius Isaac
Isaac Real Estate &TriStar Mortgage - Kenmore, WA
Real Estate & loans in Kenmore, WA

Your answer was right on, dimple, & to the point.  congratulations on being asked to contribute.  That cannot but help your exposure & your business.

Feb 06, 2011 03:39 PM #72
Rainmaker
131,817
Mike Henderson
Your complete source for buying HUD homes - Littleton, CO
HUD Home Hub - 303-949-5848

Good answer.  Congrats on getting this great pr opportunity.

Feb 06, 2011 04:55 PM #73
Rainer
1,388
Lily Ta
Distressed Property Institute, LLC - Austin, TX

What a great answer. Short sales are a time consuming; however, if the buyer can get a great deal on an investment property then why not? Find those investors and have them wait! It is worth the time to have a great ROI. Would you agree? 

Short sales are never a guarantee, but under market value? Yes, I'll take one please.

 

Lily Ta

CDPE

Feb 07, 2011 01:33 AM #74
Rainmaker
283,828
Robby Leviton
Keller Williams Realty - Kirkland, WA
Knowles Team

Angela, very good response to them. If you were to add anything I would suggest the fact that with a short sale a buyer should not become emotionally attached to the home and due to the nature of the situation most buyers are bringing emotion into the decision.

 

Robby

Feb 07, 2011 02:45 AM #75
Rainmaker
1,431,864
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

I think your answer it right on.  You can never tell what is going to happen while waiting on the bank to approve your offer.

Feb 07, 2011 06:18 AM #76
Anonymous
Susan Waddle

When selling shorts, I have a disclaimer that I use, it basically tells all that can happen from experience to the buyer.  They have to make the decision.  The great deal, is not always a great deal!  Unencumberedproperties are their best bet!  Who knows what is just around the corner for those who do buy ss or Foreclosures according to many articles and new agencies are reporting!  Yikes!

Feb 07, 2011 06:33 AM #77
Rainer
35,190
Diana Mehnert
Coldwell Banker Harris McHaney & Faucette - Bella Vista, AR

Excellent response.  I'm currently working with some folks, that made an offer on a short sale.  Only problem is the listing agent has no clue what he is doing.  It is his first short sale listing.... he has no idea who the bank, when I asked him if the list price was bank oked...he says what do you mean.  So we are pulling our offer and moving on.

Feb 07, 2011 01:50 PM #78
Rainmaker
648,810
DeeDee Riley
Lyon Real Estate - El Dorado Hills CA - El Dorado Hills, CA
Realtor - El Dorado Hills & the Surrounding Areas

Angela - Good question and good answer on your part!   All buyers think they have the patience even when you tell them it could be months.  Once were are in the process, I see a lot of impatience!  Congratulations to you on the request!

Feb 24, 2011 04:37 AM #79
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Rainer
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