As you are reading through the realtytrac data, you can become misled pretty easily because only certain information is released. For instance, a home in Los Altos may show up with a $350,000 default amount. You may not know the amount owed on the 2nd loan (many times homes have junior lienholders). And, homes will be priced to what the banks discern the market will bear, when they are actually for sale.
So you can spend a lot of energy being interested in homes that have begun to go into default that are not for sale when you look at all of this data (some of this information on defaults is also available on Trulia).
Realtors can send you homes that are for sale now -- or you can also find them yourself at http://www.REIL.com, the professional site that is updated every 15 minutes.
Good luck! Let me know if you'd like to be blind copied on the list I'm already sending! I grew up in Palo Alto (on the Peninsula) and I have to say that I am not seeing homes at the $250K price point except in EPA and Redwood City. I'm seeing this price point in areas of San Jose like 95116 (downtown) 95127 (east side, but not in the hills yet) and 95122 (near Santa Teresa/Silvercreek) and 95111 (Senter Road). Santa Clara has one home for $385K. Sunnyvale had one for $399K but it's gone (listed last week). Cupertino had one foreclosure for $599K but it's gone. Los Altos had one foreclosure for $945K recently.
At the price points you describe, on the Peninsula, we're seeing homes in East Palo Alto and Redwood City for the most part.
You can also go to my websites and email me there.
Go to; ultimatehomerequest.com or ServingSantaClaraCounty.com
I specialize in purchasing REO/Short sales properties. The other realtors have basically covered RealtyTrac the only thing I would add is that the data is not always accurate or current. If you want a Free search for Reo's you can go to my web site and log-in exactly what your looking for, or if you need help with your search just email me and I would be happy to help.
Realty Trac is an excellent tool if you are a serious foreclosure investor and buy a high number of homes.
I believe the cost is about $50 per month so it is probably money well spent.
That being said, most properties do end up being sold on mls - both REOs and short sales.
Of the two types, I would say look for REOs as you will get a quicker response from bank and often times can make a better buy. Lenders are sometimes reluctant to take less their their loan amount for the property as they would need to do in a short sale. Once the lender foreclosues and has the property on their books, they are eager to get rid of it.
I recently wrote an offer for a buyer on an East Palo Alto foreclosure REO - listed at $240K. This property sold for $640K in early 2006. There were 13 offers and the property sold for over $300K but less than $350K.
So foreclosure REO purchases are very competitive becvause the banks price them so low.
Realty Trac has some listing information, but they obtain that information from the local MLS. Any agent in the area which subscribes to that MLS can provide that information.
Realty Trac also give you information on Pre-Foreclosure homes, but that is an entirely different beast and not for all investors. My suggestions to you is to search bank owned properties and short sales. As an investor you can take advantage of this market and if you are diligent enough, you can get a good deal. You can search bank owned properties and short sales on my site, http://www.viniciusbraisl.com. Good luck.
Here is a recent post that outlines what RealtyTrac is really about and where to get foreclosures:
Let me know if you have any questions.
Good luck, Dunes