Foreclosures We Followed - Where are They Now?
Posted by Ryan Ward on Saturday, May 9th, 2009 at 9:31am.
A few months back I wrote a few posts about some excellent foreclosure deals in Roswell and Alpharetta. One is a foreclosure in Glen Abbey, one is a great investment property in Berkshire Manor and another is a large home with a pool in Brookfield Country Club. The purpose of all three of these posts was really twofold:
1. They were good deals.
2. There is a terrible misconception on the part of the buying public (many of which are regular buyers who believe this is a good time to "invest") in understanding how to ascertain value and/or an offer price on properties such as these which is truly unfortunate because there really are so many great deals.
I figured if I went through a few examples, we might help set some buyers get straight on the process. It's become difficult in today's market because many buyers have outrageous stories about a friend who has a brother who works with someone who bought an $800,000 house for 250K....or, they pay too much attention to incomplete stories from the media. Either way, here is what the true real estate market in Metro Atlanta is like so if you are in the market for something like this (and if you are in the market, you probably are) you might find this helpful.
So, to the properties....
The first was the foreclosure in Glen Abbey. Because of this blog post, we showed the property a couple of times, but, we did not sell it. Originally when this was listed as a foreclosure it was priced too high which is what I said in my original post about the home, but, once the bank got the price right, it sold quickly. Moral of the story? Use an agent who is capable of ascertaining real market value, who knows where the deals are and trust their advice and you will find a great deal!
The next one was a little investment property in Berksire Manor. This one is scheduled to close in June and went under contract in about 2 weeks as most properties that are priced right do whether they are foreclosures or not (even in this "buyers market"). The difference is that foreclosures priced correctly typically have multiple offers - and when I say multiple, I mean more than 5 which often leads to sales above list price. Moral of this story? Same as the other...you can't really buy foreclosures for 60 cents on the dollar from the list price you see when you are in the house, but, you will typically be able to buy them for 60 cents on the dollar from the high of the market. This represents the value that you need to be looking for, not 60% of list price. Understand?
The third foreclosure that we talked about was a really nice deal in Brookfield Country Club. At the time I wrote the post, it was listed for $415,900. They dropped this one to $399,000 and it sold for $390,000. The entire listing period was 30 days. I think we could have closed this one for the $390K price even when it was originally listed at the $415K. Moral of this story? There are some really good deals to be had. What you need is excellent representation and to trust that representation.
There are a lot of really good real estate agents out there, but, many of us are becoming frustrated with a large number of buyers who hear stories that are not likely true and are unwilling to listen to us without first exercising their desire to make extremely unreasonable offers on several properties until they either leave the market or finally decide to listen to their agent. Save yourself the trouble. Get yourself a great real estate agent, and utilize their expertise. That's what we are here for.
Hi, and welcome to our Atlanta real estate blog. This is a place to connect and build relationships in the Atlanta area. Whether you are a consumer, journalist or another real estate professional please feel free to share your thoughts by leaving a comment. You will find relevant local and national real estate information as well as market statistics, insight and information about various neighborhoods.
Ryan Ward, Principal
Premier Atlanta Real Estate
Atlanta Real Estate
Phone: 404.630.3187
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Share17 Responses to "Foreclosures We Followed - Where are They Now?"
Hi Mike, It's true but frustrating because many buyers just beginning the search come to the table with skewed perceptions of the market through no fault of their own. We have to try to help those who can be helped, but, also know when it's time to let someone go...
Posted on Saturday, May 9th, 2009 at 1:20 PM.
I totally agree Ryan. Some people are receptive to the truth and change their ways in looking at accurate market prices, on the other hand many are not that receptive to the facts. Thank you for posting this great article, I hope it helps future homebuyers better understand the current market.
Posted on Saturday, May 9th, 2009 at 3:22 PM.
Ryan...great post. And I agree having a real estate professional you trust is key to making the most of the current market. It's important for buyers (and sellers) to understand the dynamics of value at work in the current market are...in most cases...no different than they were in 2006 when the market what at it's peak. Sure - there are Foreclosures and REOs. There are also Short Sales and Auctions. But the way in which a property is being sold and who is selling it has no impact on whether it's a good deal. The market runs on simple supply and demand economics. And value is about being able to support an asking price through reasonable analysis of the active market and most recent pending and closed sales. And, now more than ever, it's about go out to there and taking a look at your options as a buyer (or, conversely, your competition as a seller) and making selections and determining value/price through subjective comparison.
Posted on Sunday, May 10th, 2009 at 8:44 AM.
I've found that it's completely necessary to have early expectations meetings with my investor clients. We review List vs. Sold values in a criteria range. What people have to realize is you don't have to get it well below asking price for it to be a deal. I've seen many deals that would be great buys at over asking price or more. Great post, been reading for a bit, thought I'd drop in & say hi.
Posted on Sunday, May 10th, 2009 at 4:57 PM.
Brandon,
Thank you for commenting. Reviewing list/sold prices on relevant comparables is always helpful - provided you can articulate what it means...
Joshua, "The market runs on simple supply and demand economics. And value is about being able to support an asking price through reasonable analysis of the active market and most recent pending and closed sales."
That about sums it up - except for the expectations many buyers are bringing with them...I think that any really exceptional agent can either educate the buyer or move on to more productive activities...
Posted on Sunday, May 10th, 2009 at 9:29 PM.
"I've found that it's completely necessary to have early expectations meetings with my investor clients. We review List vs. Sold values in a criteria range. What people have to realize is you don't have to get it well below asking price for it to be a deal." COuldn't agree more. with people listing at much lower prices there isn't the need to hustle down prices for deal properties. For instance check this out [url=http://www.livinglakechapala.com]Lake Chapala[/url]
Posted on Monday, May 11th, 2009 at 12:10 PM.
I agree that when shopping foreclosures an experienced agent is key. One that does not deal with foreclosures often will not only not be very good at finding good deals or values but will also struggle with the paperwork for a few nightmares and headaches there as well. You are right that when a property is priced right it will sell quickly no matter what the market is :)
Posted on Thursday, May 14th, 2009 at 9:10 AM.
Here in New York City it's often the sellers who are more of a pain than the buyers. Most of them just don't want to lower prices, despite the economy. In New York, prices are so huge for even a one bedroom apartment, that people don't want to accept that they may be losing money on the deal.
Posted on Friday, May 15th, 2009 at 3:02 PM.
I write about pricing the home right all the time. Some out there just do not understand, but those that do, get their homes sold in a very reasonable amount of time.
Posted on Tuesday, May 19th, 2009 at 10:03 PM.
Just wondering if you are starting to find the market coming around at all yet? Cheers!
Posted on Friday, June 5th, 2009 at 12:42 PM.
Hey Ryan excellent post, this is the most frustrating part of working with unrealistic buyers they associate how much they can get off the list price as being a deal when in fact it is the real market value is what they should be going by. Some homes are overpriced, some homes are under priced and some homes are priced right.
Posted on Thursday, June 18th, 2009 at 12:08 PM.
Ryan, It's nice to see you address a very hot topic. With all the media hype (for the last 3-4 years) and late night infomercials foreclosures are a very hot topic. What once was a great deal has turned into a demand vs supply issue in the Green Bay Wisconsin market. Houses that are foreclosures and advertised as one generally get boatloads of traffic and people have the pre conceived notion that they will be able to get a property for .60 on the dollar. Good luck it's not the reality in the market and you lay it out perfectly in this blog post.
Posted on Thursday, June 18th, 2009 at 11:08 PM.
Ryan, This post was right on. One of the scenarios that could have easily been mentioned was when the buyer looks at several properties and makes unrealistic offers on several properties to no avail they more often than not become dissatisfied with their agent and not just move out of the market but move to another Realtor. Unfortunately for the buyer and the Realtors they come across it can sometimes take multiple rounds before the buyer's expectations are modified to a more realistic pursuit. Great post.
Posted on Wednesday, July 8th, 2009 at 2:57 PM.
Our market is absolutely on fire for the lower end homes right now. No matter how much I preach about going over list price on the bargains out there, we usually have to place offers on a few homes before my buyers catch the drift (multiple offers on every property sometimes 6 - 10 offers). When reality sets in, they go over asking price by 5 - 10k and they still get a steal on the home!
Posted on Saturday, July 11th, 2009 at 11:51 PM.
Ryan, Buyers seem to be unrealistic and a bit far off in my market as what to offer. Not every seller is needy and going under. Buyers need to be set straight from the beginning so they are not wasting an agents time. What are your thoughts?
Posted on Tuesday, August 11th, 2009 at 6:01 PM.
Hi, Nice post, I agree that today many buyers will refer to go on with the great deal. Deal that in their benefits like good and affordable prices, no matter what happen buyers will going to buy that property as long as they know that is the real price in the market.
Posted on Wednesday, September 16th, 2009 at 8:55 AM.
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This is very true Ryan. It is very difficult as agents to explain that it is near impossible to get an 800k home for 250k. Between DIY networks fake real estate shows and such, the general public thinks that it is very easy to steal a property. As soon as we here a prospective client wants to offer 100s of thousands under the list price, the relationship is usually terminated on the spot.
Posted on Saturday, May 9th, 2009 at 11:31 AM.