Lori Mode

In the Elk Grove area, both REO's or bank owned homes and short sales are generally being sold for over the list price. It is very difficult to give you a rule of thumb right now. Some are selling for just a few thousand over the list price and then I recently had a REO listing that sold for almost $30,000 over the list price. The banks have started being very agressive on their pricing and with more buyers in the market because of affordable prices and low interest rates, offer prices are adjusting up.
I would recommend that you work with an agent that knows the market well and when you decide to place an offer on the property, make sure that the agent completes a Comparative Market Analysis on the property for you to review. This will help you with the offer price. If you have any questions regarding this please feel free to call me at (916) 230-0371 or email me at Lori@ModeandDurhaM.com.
Sincerely,
Lori Mode
The Mode & DurhaM Team
Keller Williams Realty
(916) 230-0371 - Thu May 14 2009, 20:54

May - Was this home a short sale when you made the offer on April 13th? It sounds like there was a very good chance that it was. A very high percentage of our current listings in the Elk Grove area are currently short sales. Today we have 888 active listings in the Elk Grove area and 639 of those are short sales. When you made the offer you should have been aware of that.
Unfortunately a short sale means that bank has to agree on the sale as they are going to receive less than what is owed to them on the property when escrow closes. This process can take anywhere from 30 days to 6 months. Communication between the listing agent, your agent and you are critical to complete this process. During that time a lot can happen - the bank could take the property back in foreclosure or the current owner could have received a loan modification, for instance. If you would like more information on the short sale process, you can visit our website at http://www.AllElkGroveHomes.com.
Since this property is back on the market with another agent listed at $239,900, it appears that the bank probably took this property back and it is probably an REO or bank owned listing now. If you would like more information on this please feel free to call me at (916) 230-0371.
Sincerely,
Lori Mode
Keller Williams Realty
(916) 230-0371
Lori@ModeandDurhaM.com - Mon May 11 2009, 08:14

I can tell you what is happening in Elk Grove and Sacramento with REO properties currently. If the property is listed under market value, there are multiple offers. I had one last week with 18 offers on it. It was listed at $262,900 and the highest offer was above $300,000. After the offers were submitted, the bank did come back with highest and best to each offer and the buyers had 24 hours to increase their offer or keep it the same. The top offer remained at the same price as their original offer and they got the property.

Now with that being said you need to trust your agent...if you do and the agent has experience with REO's, I would listen to what the agent recommends you do. If the agent did a market analysis on the property for you and you can see that it is below market price, my suggestion if you were my buyer would be to go in above asking price. The other thing to consider is if you are asking for any credits for buyer closing costs; if you are not,. you may not need to go quite as high as another offer. I would have your agent run the last 60 days of solds in the area and show you the difference between the list price and the selling price. The trend on closings in Elk Grove over the last 60 days - if the home is priced under $250,000 - is that they are selling for approx. 104% of list price.

A higher earnest money deposit will help if your offer is similar to another one but the banks mainly are concerned with their bottom line or net.

Good luck,
Lori Mode
Keller Williams Realty
(916) 230-0371 http://www.AllElkGroveHomes.com - Mon Mar 30 2009, 18:01

Nancy -
This is a difficult question to answer from the facts above....there are several different things to consider to help you make this decision. First, is the property currently rented? How much is your negative? Can you tolerate paying it and if so for how long? Would it be beneficial for you to move into this home or do you own other property as your primary residence?
I know things seem bleak right now...I also purchased an investment property at the height of the market - paid $345,000 with $100,.000 down so I owe approx. $240000. I just sold the same model in the same neighborhood for $190,000. I took have a negative on it - approx. $200 per month. I own other investment properties that make up the negative though and it's a great neighborhood. This market is or is about at the bottom on this type of home in Elk Grove. We are receiving multiple offers and they are going often for over the list price. It's going to be a while however before the market goes back up to where it was...can you hang on until then?
Also have you talked to your existing lender about a loan modification? And have you considered a short sale.? You may have options that you haven't considered yet. If you would like to discuss this further, you can send me an email at Lori@ModeandDurhaM.com and let me know when I should call you. t n addition, there could be tax and credit consequences to walking away to consider. For more information on short sales, check out our website at http://www.AllElkGroveHomes.com.

Lori Mode
Keller Williams Realty
(916) 230-0371 - Sat Mar 28 2009, 14:30

If the Trustee Sale occurred on 9/8/08 then the bank now owns the property. You are correct the former owner cannot help and the listing agent cannot either at this point. This property will come on the market as an REO or bank owned home sometime soon, but could take the next 30 - 90 days. At this point, if there are other homes that you are interested in, you should pursue those; I wouldn't wait for this to be relisted on MLS as a REO listing, as interest rates are great right now.

There really isn't much of a way to expediate the process on your end to purchase this particular property...were you the only offer? or were there others? Which lender is it that acquired the property through the trustee sale? And do you know if you were paying current market value?

It is very important that you get good advise from an agent that is knowledgable about this whole process. If you have further questions, please feel free to email me at Lori@ModeandDurhaM.com or call me at (916) 230-0371. - Thu Sep 11 2008, 19:47