The sale in December 2008 is when the lender (Federal National Mortgage Association aka. Fannie Mae) purchased the home at a price based on the loan balance.
This appears to be a situation where the bank loaned more on the property than it's value. Looking at the history of this property, it was on the market for several year (since May '04) at several price points....all too high.
Even the tax assessor has the property valued more than $100,000 higher than it's true value, based on recent comparable sales.
Once Fannie Mae acquired the property, they likely paid a couple of real estate agents to perform Broker Price Opinions (BPOs) on the property to determine the current value of the asset, based on the current market and the condition of the property.
Of course, Fannie Mae would be thrilled to list and sell the property for $287,000, yet they know that buyers do not care what they paid for the home or what the loan balance was when the previous homeowner went into foreclosure.
In most cases, buyers are only willing to purchase a home that seems to be of equal or greater value compared to the other homes on the market. This is especially true in today's real estate market.
Based on the market analysis that I performed for this home and this neighborhood, Fannie Mae correctly priced this property at $239,900.
Purchasing bank owned properties is one of the best ways to gain equity in home. Bank owned properties tend to be listed below the market due to repairs needed.
If you have a little vision and have the ability to pay for these repairs or do them yourself, you can find some great deals. In addition, banks are typically in a better position to negotiate deep discounts compared to traditional sellers, creating an even bigger financial opportunity to home buyers.
If you would like to see a quick market analysis this home or a list of other foreclosures in the Indianapolis area, give me a call at 317-842-0500.
By the way, if you have not owned a home in the last 3 years, you may qualify for an $8000 tax credit.