Sellers of short sales or those foreclosing do not have the money to maintain their
home. Also, when Banks seize and foreclose property it is 6-9 months after a home
owner has not been able to pay the mortgage.
Home owners facing a Short Sale or Foreclosure are emotionally detached, as their Credit scores are ruined, and they wonder if they get rent in the future or find a job, if they were to loose one.
Now a days employers check your Credit score as one of the many attributes before
they hire you. Also, it is not common for a home owner facing such hard times to take appliances
Prudent to do all home inspections:
Yes they often are with foreclosures, not as much with short-sales because the owner wants to be able to get out of the property and sell it. With both, however, they are sold "as-is" meaning you might have to put some work into the property.
The people lose the house and are upset... a foreclosed home is more likely to have the worst damage because the people no longer own it, while a short sale house I'd think they'd hope to sell it!
The short sale we are involved with has no lightbulbs and a smashed open window, and they took all the kitchen appliances and I highly doubt they were any good anyway compared to how dated the house is.
Hopefully we even get it in the end, I mean, we're their best offer and if we can't work with FHA on this (broken window they smashed and no appliances) then they're out of a buyer and are closer to foreclosure.
I've participated in many transactions where the home has a short sale, foreclosure, and regular status. Bad condition and good / excellent condition can be found in all types of homes. I find it best to treat each home on the market and each transaction independent of all others. This way my clients, and I, go in with an open mind and deteremine the best strategy for each situation.
Showing empathy and understanding of all parties works well when looking at others homes.
Realtor, Alain Pinel Realtors
To be frank, I've sold both foreclosure and short sale homes to buyers just like you, and they are seldom in "bad shape" today--that was certainly not the case about 2 years ago, but today, both banks and sellers are learning the lesson that abandoning the property has greater consequences than simply a loss of price. For the most part, most sellers know that it is to their advantage to help the home get the highest possible price, so short sale homes are often maintained, but not necessarily completely improved.
Foreclosure properties, as one agent already noted, can be either cleaned up and improved by (often) the listing agent or bank, and while it can be missing appliances, most are in good and serviceable condition with some areas that need repair due to neglect. Depending on the length of non-occupancy of the home, the condition may be better or worse than comparable foreclosure homes in the area. Again, most foreclosures are cleaned up but seldom improved often due to lack of funds by the sellers.
Most importantly, Home88, you can greatly minimize potential problems during and after the sale by working with a qualified and experienced agent familiar with both foreclosure and short sales home purchases.
Grace Morioka, SRES
Area Pro Realty-PC
Even worse, however, are those that are just mad at the world and bitter so they will go as far as tearing out drywall, breaking windows and, this will really get you, pouring cement down the toilets. We've even seen homes where certain floor tiles be chipped up and roof tiles removed and/or broken.
The good news, if there is any good news to be had here, is that normally only happens with foreclosures. Folks going through the short sale process tent to take much better care of their homes because they are attempting to deal with it in a way that they may become rewarded for taking better care of their homes i.e. cash for keys or the ability to live in the home until the short sale is complete.
The bottom line is that while distressed property investing can be lucrative to a seasoned and experienced professional it can be grueling and frustrating to a newbie or average home buyer who just thinks they can get a good deal because they think the house has lost so much value.
Truth be known it probably has lost a tremendous amount of its value but how much is it going to take to reconstitute the home into a viable investment after you purchase it and what will you have to market it for and how long will it take to recoup your investment?.
I have seen you pretty active in this forum. To be frank, it's still much better shape today than 2-3 years ago if you were in the market to buy. For example, I showed homes (only 4-5 years old) in Elk Grove area 2 years ago and they all in bad shape because previous home owners trash it, destroy it or take things out to resell it. Fast forwarding, those things are not happening anymore.
Any homes or anything will need TLC just like your car, if no one cares or live in there, of course it is going to get worse and that is the reason we need new buyers like you to buy them.
Have a good weekend.
There are also those who want to say inside the home for as long as possible so they make it difficult to show, and unpleasant so that someone will not buy it. This further devalues the property. While they want to punish the buyer for getting a deal, they are actually helping them in some weird way.
Just because they are angry, doesn't make this right and it isn't going to change. Buyers need to understand that short sales involve emotions and having a Broker who can help them along the way and one who can work with the other side as well will be an integral part of their success towards closing.
Harold Sharpe - Broker
So Cal Homes Realty
California Department of Real Estate Broker License # 01312992
Hope that helps,
I have written a number of blogs on the topic of short sales - http://www.patchadwellblog.com.
Pat Chadwell, Broker
Realty World -Residential Specialists
408-927-6565 x 11
Additionally, it can take months or even years for a distressed property to transition from owner occupied to "for sale" as a foreclosure. These homes are often left unattended for long periods becoming targets for individuals will less than good intentions. Considerable damage can occur from the time the owner leaves until it reaches the RE market.
Hope you find this information helpful.
Inteto Real Estate