When HOA Directors Complain That a Short Sale is Priced Too Low

Real Estate Agent with Keller Williams Realty Louisville East (502) 664-7827

Fact: Short sale properties sell for less than market value.

Fact: Neighbors do not like when a home sells that can lower the comps of the neighborhood.

Fact: HOA Directors by job definition have their noses in other people's business.

Fact: HOA Directors sometimes complain that a short sale in their community is priced too low.

Fact: The seller needs relief from the mortgage payments and the HOA fees and needs the property sold. In a short sale, usually, the price is not the seller's main concern.

Condo Dave Halpern Realtor Louisville

So how does the Realtor explain the lower price when accosted by the HOA Directors?

  • Fewer buyers will be interested in the property because of the uncertainty of how long they have to wait to get a short sale approval, or counteroffer, or total denial. Buyers are especially wary of short sales in an appreciating market where a 3 to 6 month wait for a failed short sale offer may result in the buyer having to pay many thousands more for a comparable property when he/she reenters the market.
  • Fewer buyers mean less demand. Less demand means lower price. The short sale lenders understand this, therefore they let the house go at somewhat of a discount.
  • Therefore, the condo is indeed worth less than market value by virtue of its short sale status, regardless of its intrinsic value if it were not a distressed property.
  • If somehow the HOA has the right to impose a price that the market will not pay, the condo will eventually go to the foreclosure sale. This could cause them to have an abandoned condo in their midst with diminishing value due to neglect, deferred maintenance and sometimes even vindictive damage to the condo to purposely lower the value as a way to get back at the HOA directors who blocked the owner's ability to avoid foreclosure via a short sale.
  • HOA directors generally have very little knowledge of how a real estate market works. The market will do what the market will do, however, the lesson will remain unlearned by the HOA directors.


Dave Halpern has successfully closed hundreds of short sales in the Louisville, KY area. If you are behind on payments, or owe too much on your home, Call Dave Halpern, Realtor, at (502) 664-7827.

Keller Williams Realty Louisville East

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Dave Halpern, Realtor

The Dave Halpern Real Estate Group

Keller Williams Realty Louisville East

Website David.DavidHalpernRealtor.com

(502) 664-7827



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Harry Norman, REALTORS® - Atlanta, GA
Associate Broker

Good morning Dave Halpern 

Thank you for sharing your information with us.  Have a great day.

Oct 20, 2017 05:44 AM #1
LaShonda Solomon
Atlanta Communities Real Estate Brokerage - Kennesaw, GA
Serving Cobb, Paulding, Douglas, Bartow Counties

Thanks for your insight.  In my years of facilitating short sales most of the HOA issues were because the seller  was deliquent on HOA dues and the HOA wanted the full amount, not a settlement.  We have been able to work through those.  Now I have encountered one where the HOA is complaining about the price being too late.  But as you pointed out, they will either accept the short sale or accept a foreclosure. 

Oct 20, 2017 07:04 AM #2
Debbie Reynolds
Platinum Properties - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent

I personally think it is not the HOA's business. If a property owner is put in a position to have to short sale their home, this is far better than a foreclosure.

Oct 26, 2017 07:29 PM #3
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Dave, not sure how the HOA feels they have a say in this matter???    It is between the homeowner, the bank and the REALTOR.

Oct 27, 2017 04:37 AM #4
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, Blackstone Realty Group - brokered by eXp Realty - Kalispell, MT
The House Kat

This is a good overview of arguments to be used in a situation where an HOA is trying to get involved in setting a price. Although as Debbie and Joan pointed out, they shouldn't be.

Oct 28, 2017 03:52 AM #5
Beth Atalay
Cam Realty and Property Management - Clermont, FL
Cam Realty of Clermont FL

 Good morning Dave Halpern, I'm working on a short sale which has become a total nightmare, HOA board members have been so uncooperative and unwilling. They insist on homeowner paying the difference from her proceeds, they actually put this in writing.  People underestimate the "power" HOA board members have. In all my years of doing short sales, we were always able to settle but not this one.

Oct 28, 2017 06:31 AM #6
Silvia Dukes PA, Broker Associate, CRS, CIPS, SRES
Tropic Shores Realty - Ich spreche Deutsch! - Spring Hill, FL
Florida Waterfront and Country Club Living

Dave, when people complain about property that is for sale or what might happen to it after the sale, there is always the option or them to make an offer the seller cannot resist! In this case, nothing would prevent the HOA to buy the home at a higher price than listed. Presented with that option, most people will reconsider.

Oct 28, 2017 01:10 PM #7
Pat Starnes-Front Gate Realty
Front Gate Real Estate - Brandon, MS
601-991-2900 Office; 601-278-4513 Cell

HOAs don't want vacant, abandoned, or unkempt properties in the neighborhood either. I've never had an HOA representative approach me about a short-sale home, but if they did, I would explain it beats the alternative.

Nov 01, 2017 07:56 AM #8
Michael Eisenberg
eXp Realty - Bellingham, WA
Bellingham Real Estate Guy

If the homeowner is delinquent on their HOA dues, the HOA has a right to collect them but fortunately, they have no say in what a home sells for. They may not like it, but would they rather have an abandoned home or foreclosure

Nov 03, 2017 12:35 PM #9
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