Market Insights: Buyers snap up short sales & bank-owned properties
The data is clear. The number of short sales and bank-owned properties on the market in 2012 is lower than the previous few years. Overall, this is a positive sign for the market.The first wave of distressed properties to hit Summit County in this economic downturn started in early 2009. These properties were mostly second homes, homes built on speculation with the hope of making a handsome profit and properties rented out. My sense is that these people were way, way too overextended; so as things turned bad in the economy, it quickly became apparent they could not make their mortgage payment.The current wave of distressed properties appear to be owned mostly by local residents as their primary residences. These people have been doing everything they can to hold on over the past few years. And now they just can’t keep up with the payments any longer. This is very unfortunate for these locals.So who are the buyers in the market right now snapping up these distressed sales? Mostly locals who have saved the minimum of 20 percent or 30 percent down to qualify for loans. And what do I mean by “snap up?” Generally, these properties stay on the market for under 90 days.And how do you find one of these opportunities? 1. Work as a team with a broker who is very, very experienced with all the processes involved in dealing with distressed sales.2. Search online each day.3. Be prequalified with your lender and ready to make an offer when the right property comes along.To illustrate the point this week I have selected three very different properties all in the Breckenridge area that are all distressed.
This smaller condo (762 sq. ft.) is on the bus route, has able parking and was fully renovated just a few years ago. It was purchase in December 2007 for $314,000. It is a short sale.
The lender of this bank-owned property just dropped the price by $25,000. At $186/sq. ft. for a home in very good shape, this really is a bargain. It is at the end of a quiet cul-de-sac and has an oversized three-car garage. Possibly the huge family room over the garage could be used as another bedroom.
This home came on the market this week. It is the area known as Highlands Park South, where the next home on the market is $200,000 more. This home is also on a cul-de-sac.
Be well informed and know what you are doing before making an offer on a distressed property. Daniel Webster Johnson has earned the Certified Distress Property Expert designation, which is the best known national program of the type. He is a broker associate at Resort Brokers Real Estate in Breckenridge. Contact him at (970) 393-3300 and/or Daniel@YourMountainBroker.com.
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