In the current market in some areas, at the lower price points, it is NOT a buyer's market. That is certainly true here in Southern California in communities like Oceanside, Vista, San Marcos and Escondido where there are a lot of short sales and REOs (bank owned foreclosures) under $300,000.

And buyers are finding they need to make quick decisions or they will lose out on properties they like. It is particularly difficult if you are relocating and are not here physically to see properties as soon as they come on the market.

The question becomes - "Buyers, How Fast Can You Move?". Read more to understand how this may affect you.

Lots of folks want to buy a short sale or an REO...or think they do.

This is fairly common for folks who are relocating here to Southern California because of the perception that these may be great deals given what they have heard about California foreclosures, and major price adjustments in the last several years. While it is true that prices have come down, substantially in some areas, the belief that you can get a home for 50 cents on the dollar is just not realistic, nor is buying a waterfront home in Carlsbad on the ocean for $500,000 a possibility.

That does not mean that you should not consider short sale and REO (foreclosure, bank-owned) homes, along with traditional resales so you get the full picture of your options. Indeed, you should. But being aware of some of the issues is important so you make an informed decision.

One thing you will often find is that things you normally would find in a resale are missing in a short sale, and even more commonly in an REO.

Read more about buying a short sale or REO to find out what you may be missing...

I wrote a warning to buyers, and agents, recently. It had to do with ot opening the refrigerator door in homes they were touring that are distress sales - bank owned properties, and vacant short sales and foreclosures.

Here's why you don't open that refrigerator door.

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If I can provide more information about Carlsbad and surrounding areas, or the housing market in general, or otherwise assist you in your homes search, please contact me by phone or text at (760) 840-1360 or email me at JDowler@remax.net.

All content copyright © 2009 Jeff Dowler

REOs (bank owned properties) are found in the majority of real estate markets these days, along with short sales and foreclousre. Lots of buyers are interested in acquiring these properties but the task of doing so is often not easy.

REOs tend to be easier to purchase because they are already bank owned, and they are generally pretty motivated to sell. Don't expect to get these at rock bottom prices, but some are pretty good deals.

If you are moving to, or are in, the Carlsbad California area I just posted an article are buying REOs

.

• The article provides some important information for any buyer interested in buying an REO.

• I also provide a sampler of REO buyers in the Carlsbad real estate market and in nearby areas.

Since short sales have become fairly common, and you may decide to put an offer in on such a property, there are some other things to know.

Read my post on Activerain for more details. You may find some of the agent comments useful, too.

Jeff

Just another quick note about short sales.

Since the sellers still own the house, they will need to agree to any offer that the buyer makes. They may or may not be more willing to sell at a less than market price because of their hardship situation.

However, keep in mind that the sellers' lender will need to APPROVE the offer as well. They likely will send out an appraiser in order to assess the market value.

So, even if the sellers are willing to go with your offer, the bank may not allow it.

Be sure to investigate the comparables that have sold recently. You will have a better idea of the market when making your best offer so you can improve the likelihood that both the sellers and the bank will approve. Your agent will be the best source of information.

I can't speak for other states, since they may have different requirements, but when making an offer on a short sale here in CA there are some things to know about the paperwork. Not a lot of new docs, but important stuff!

There are a good number of homes here for sale that are, or very likely will be, short sales - the amount the sellers can SELL FOR (market value) is less than what they owe. There are a number of reasons why this happens - that's a subject for another post. So you will likely come across some of these homes in your searching...but don't be mislead into thinking these are not worth your consideration, as some are really great properties.

Your agent will help you fill out the standard paperwork (the 10- page RPA or Residential Offer to Purchase, which includes the 2-page Buyer's Inspection Advisory), agency disclosures, and Wood Destroying Pest Inspection addendum. You really should have your PRE-APPROVAL (IMO is it always important to submit with an offer) too, and your depoist check. (NOTE  - I have a list on my website of the standard documents that are part of a buyer transaction - my Buyer Forms Checklist)

Two important additions:

• The PAA - the Purchase Agreement Addendum with box #5 checked (for short sale)
• Not required but advisable - a short letter requesting confirmation that the sellers have submitted the paperwork, hardship letter, etc. that their lender requires as part of the short sale, and if not, when they expect to do this (set a due date in the PAA). This can hold up the process if not done in a timely manner. The bank will have a checklist of things they require and you want to know what those are.

Your agent can provide more information about things you should know. But please ask if there are any questions and I will post the response.

Have a great weekend!

Jeff