Saw the following interesting chart today regarding Gainesville, GA current real estate listings on Yahoo Real Estate.Â
Source Yahoo Real Estate
This shows list priceÂ versus list price on all homes for sale versusÂ bank owned foreclosures currently on the market in Gainesville,Â GA.Â It also shows us that bank owned homes or REOs are listed for about 75% of what the overall market is listing a comparable home for in Gainesville, GA.Â Why is this statistic important?Â I speak to Buyers on occasion who have felt insulted at times that a bank did not want their offer, we are in a buyer's market you know, and at other times have also not taken advantage of a good foreclosure purchase because they didn't want to pay 'too close' to list price thinking that beating up on 'list price' was the goal.
I have said it a hundred times just in the past week alone I would bet you, we don't care about list price. We care about being below market value.Â If bank list prices are already a quarter below the market, then if we get a contract on a house for 90% of list price, this is a good day!
RealtyTrac and others in the media are really good about stating that the average foreclosure discount is 32%, 35%, 37%, and higher in some states!Â What they are always referring to if you note the fine print is that the average foreclosure sale is roughly a third (give or take) lower than the average overall sale in that specific market.Â Not a third off list price, but a third or more off the average sales price.
Let me encourage you not to get perplexed if your Realtor comes along telling you that you need to think about paying 'highest and best' in a multiple offer situation necessary.Â Don't over analyze if Fannie, Freddie, or HUD comes back with a counter just a few percentage points off their list price!Â In golf they say that over analysis leads to paralysis, and I would throw in too not to have your sights on the wrong target!Â
Both may cause you to miss a good thing!