Real Estate Investor · Toledo, OH · Member since 2008 · 234 posts · 53 votes
So we put in an offer last week on a REO/Foreclosure. We put in their asking price...cash and no inspection. We were the first ones according to the selling realtor. But then she comes back the next day and says they got 4 more offers and to give our highest and best. What the heck?! It's just frustrating when the banks do this and want to turn these into auctions with bidding wars. We offered exactly their price, plus cash, plus no inspection and ours was the first offer the bank received. I think it's just wrong. Granted I know they can do whatever they want but it's just B.S. in my opinion. And I wish there was some sort of policy where if they put a price out there on a property and the first offer received meets their requirements that they should have to take it. In a perfect world right? LOL!
Anyway, we told our realtor we won't get into a bidding war and that is our highest offer. Haven't heard back but I'm pretty sure we won't get it. There will be others.
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
16y
Originally posted by Rich Weese:
Just a quick follow-up. My area, ft. myers/cape coral has just been rated 3rd worse in current foreclosures behind Vegas and Modesto, CA. Highest increase in foreclosures from qtr 1 2009 till qtr 1 2010. Sounds like bottom hasn't been reached here yet, imo. Rich
Yup...I'm still thinking we're a year from bottom...between alt-a defaults, option arm defaults, the tax credit and the seasonal downturn next Fall/Winter, I don't see a pop in prices until at least next Spring...
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
16y
I don't think it's unreasonable for the bank to try to get as much as they can for a property, even when it's more than the asking price.
When I sell my houses, the best case scenario is that I get multiple offers, and if I get an offer in the first day or two, I'll generally stall to see if I get more (even if the first offer is full price).
If the bank can get more than full price, why should they settle?
SFR Investor · Orange County, CA · Member since 2009 · 1k+ posts · 1k+ votes
16y
I witnessed the same tactic when we bought a rental home last summer. It was listed at a ridiculously low price, for no other apparent purpose than to create a flurry of activity.
It might sound nice on the surface to have a law that mandates a seller must accept the first offer that matches their "asking" price, but then I think you'd find the asking prices much higher.
Real Estate Investor · Toledo, OH · Member since 2008 · 234 posts · 53 votes
16y
If for nothing else the tactic wastes my time. But yes, they can do whatever they want. I see why though some investors don't waste their time on the bank owned. I see a number of them seeking other avenues such as advertising that they buy houses, etc., and let the sellers come to them. Probably a lot less time wasted that way.
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
16y
Originally posted by Kel S:
I see a number of them seeking other avenues such as advertising that they buy houses, etc., and let the sellers come to them. Probably a lot less time wasted that way.
Only if you consider it not wasting time to get 200 phone calls from sellers who are not really motivated to sell and have no equity in their homes... :wink:
Real Estate Investor · the villages, FL · Member since 2008 · 5k+ posts · 3k+ votes
16y
There are lots of posts and threads on this avenue being used by the lenders. I posted an example of a home I was interested in. It was on realtor.com at $194,500. By the time I contacted the realtor, they had received 34 offers and had an offer over $300,000! They were accepting offers till the end of the month. The listing price was just a come on. This is one of the main reasons I gave up on buying a short sale or rEO and finally found a motivated seller.
I'm currently sitting on the sidelines. I remember the last time there was a feeding frenzy and "auction scenarios" on properties. How did that turn out for the buyers? I'll wait for the next wave and dip a year or two from now! Rich
Real Estate Investor · the villages, FL · Member since 2008 · 5k+ posts · 3k+ votes
16y
Just a quick follow-up. My area, ft. myers/cape coral has just been rated 3rd worse in current foreclosures behind Vegas and Modesto, CA. Highest increase in foreclosures from qtr 1 2009 till qtr 1 2010. Sounds like bottom hasn't been reached here yet, imo. Rich
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
16y
Originally posted by Rich Weese:
Just a quick follow-up. My area, ft. myers/cape coral has just been rated 3rd worse in current foreclosures behind Vegas and Modesto, CA. Highest increase in foreclosures from qtr 1 2009 till qtr 1 2010. Sounds like bottom hasn't been reached here yet, imo. Rich
Yup...I'm still thinking we're a year from bottom...between alt-a defaults, option arm defaults, the tax credit and the seasonal downturn next Fall/Winter, I don't see a pop in prices until at least next Spring...
Wholesaler · Fort Myers, Cape Coral, Naples, FL · Member since 2009 · 185 posts · 33 votes
16y
I'm just getting over this low starting teaser price.
I am not sure if all these homes in Ft. Myers/Cape Coral are getting tons of offers. I am seeing many being dropped in price after awhile. But perhaps this is to get a second wave of offers in. All I know is Rich is correct, there are a ton of foreclosures in this area - way more than I could ever look at.
I am doing comps for the properties and if I need to be able to offer more than the list price that's fine - if it meets my 65% of APR price.
I am still in the research phase, but will be flying down to Fort Myers next week to look at some properties and meet with a buyers agent.
San Francisco, CA · Member since 2009 · 171 posts · 24 votes
16y
Kel,
I hope this finds you well. More than a few seasoned investors have supplied a few starting pegs for any strategy; viz:
(1) always list Highest and Best on the offer - it's assumed only about 5% of competitive bids will ascend victorious - "submit it and forget it"
(2) always consider securing deals with an EMD to show the intent to close quickly;
(3) always consider including clauses in contracts that the seller pays you for any outlays of time due to inabilities to close quickly
It honestly depends on your strategy and personal goals.
My bias comes from a strong need to be as efficient with time as possible. Generally, the freedom from stress & time to invest in learning and community building is paramount.