Jim's advice is good. As a local San Diego agent I would like to ad some info about the pre-foreclosure/short sales. Usually about half get accepted, they are listed below market to get an offer in to send to the lender and end up with multiple offers bidding the property up to fair market value. The better areas of SD get the better prices for the lein holder not the buyers. In the outlining areas where there are more short sales, then you can be a deal... it may take 10 offers to get one.
As Jim stated, the bank owned (REO's) are good to purchase. The response time for an answer is days, not weeks or months like a short sale. Some of them are starting to have the home cleaned up, painted and installing new carpet to help with the sale. The banks don't want these homes on their books. They are usually on the low end of the comparables and many of my buyers got their closing costs paid as well.
There are still downsides to buying bank owned properties. There is no disclosure from the bank because they have never lived in the home so they have no knowledge of things gone bad in the past or may be hidden. They have tons of hoops they want the buyers to go through. These are the more major drawbacks.
It is best to find a realtor that has worked with these types of sales and that will guide you through the ups and downs of the process. If you should need a realtor, please feel free to give me a call. I see you are in the North Clairemont and I'm in the South Clairemont area. I've been selling here since 1988. Would be more than happy to discuss more with you.
Have a good day.
Both types of sales are usually as is... no repairs will be done after you have had your physical inspection.
All the answers have alot of great information! I would like to add a short sale is prior to the bank taking the property back and the owner does have to have an approval from their bank on a fair market price that the bank will accept and allow the current owner to sell the home for. This process is what takes so long. When purchasing a short sale the owners of course are responsible for providing the standard disclosures with the transfer of the property and disclose any knowledge with any defects the property has. When purchasing a foreclosure, the bank is selling the property and is exempt from providing this information since they have no knowledge and have never occupied the property, "AS IS" - you'll definately want to do your homework and spend the extra $200-$500 on a home inspection. Price is usually based on the size of the home.
I list and sell foreclosures directly for the bank all over San Diego County, although my website is mainly focused on downtown San Diego, I do work all over the county. If you'd like some additional information regarding short sales or forelcosures please feel free to contact me direct or via my website.
I have guided buyers to look for the post-foreclosure, or bank-owned homes if they cannot afoord to wait 60-90+ days. Generally speaking, bank owned home is simpler to purchase, and from my experience, easier to buy due to the fact that they are vacant, and the bank now owns the home and has listed it directly with a real estate agent that generally specializes in those listings.
I hope this helps with your question. I am from Tacoma WA, but was stationed in San Diego (a long time ago), and love to visit when I can.
All the best!
Windermere Real Estate
Just be aware that you need to be diligent what ever you buy.
Joan Wilson (Realtor, SRES, Ecobroker)
California Cool 4 Sale
Prudential California Realty
Direct Phone: 760-757-3468
License # 01341483
It is my Goal to Increase the Success and Profitability of Those I Serve
It is worth your time to consider short sales and foreclosures equally. Especially since they are dominating the market. One thing to be understood is that short sales should also be considered "distressed sale" transactions because the seller lays the claim "I have no money" and so the transaction because an "as is" take it or leave it situation much like a foreclosure. Now, after you have entered escrow, short sales tend to be less stressful because you do have more time to inspect the property and secure full loan approval. Foreclosures typically require signature of bank addendums that include the automatic (or "passive") removal of your contingencies after 5-10 days (standard removal with a short sale or normal sale is in writing and most often within 17 days of acceptance). After that "automatic" removal of the contingencies (once the specified time period has lapsed) the bank has the right to and WILL keep your good faith deposit if you back out.
Have an aggressive agent.... that's your best opportunity for a deal in this market. Or consider purchasing at Trustee Sale. There's a local San Diego-based company that can assist buyers by providing the 100% liquid funds needed to do so. Contact me if you would like more info on that.
Best of luck!
San Diego Real Estate Specialist
Residential Sales and Appraisal