Banks Destroying Real Estate Market

[Account Closed]

Heard from a real estate agent this morning:

House down the block from mine, listed at $385k, accepted a good offer of $345k. Bank appraisal came back at $243K.

Banks are using their own foreclosures as comps. So even though there are willing buyers out there, trying to buy houses for a fair market price, the banks won't lend.

It's very short sighted. The banks are artificially holding the prices down to the fire sale level. If they would accept bonafide offers from willing buyers as market value (which is what they are), then there would be comps that support the higher prices and prices would raise to meet the comps. Even the banks would be able to sell their foreclosures for higher prices.

[Mark N.A]

Here's what I'm seeing from the other end (three recent examples I was interested in purchasing):

1) foreclosure being destroyed from the ground up by termites: bank sits around waiting for unrealistic price while damage grows.

2) foreclosure being destroyed from roof down from multiple leaks: bank sits around waiting for unrealistic price while damage grows.

3) foreclosure on bad side of town getting destroyed by all of the above plus vandals: bank sat around too long and now the property is scheduled for demo on the bank's dime.

Hellooooo..........