Alpharetta, GA · Member since 2015 · 15 posts · 1 vote
Hi there, I am a newbie and I am just curious...Can a good deal (generally speaking), be on sites like realtor.com, redfin, hubzu, zillow and the likes for too long, meaning like a month or plus? I think this shouldn't be the first criteria to look at while finding/analyzing a deal, but how much importance do you place on how long a property has been listed for sale on those sites?
Lender · Playa del Carmen, México · Member since 2014 · 2k+ posts · 1k+ votes
10y
@Maurice Mugabo, yes, good deals can be on home marketing sites for a while!
Some homes may be in areas that just don't get a ton of attention and therefore may sit on a site for months. These could become great deals, if the wait-time means the seller is now more motivated.
Also, sometimes a great deal gets hidden due to human error. Keep in mind that sites like realtor.com and redfin are fed by local MLS systems, which in turn get fed by fallible humans. If a listing agent mistakenly claims a home has only 3 bedrooms and no basement, when in fact there are 4 bedrooms plus a basement, a stinker could suddenly become a smoking hot deal!
Lender · Playa del Carmen, México · Member since 2014 · 2k+ posts · 1k+ votes
10y
@Maurice Mugabo, yes, good deals can be on home marketing sites for a while!
Some homes may be in areas that just don't get a ton of attention and therefore may sit on a site for months. These could become great deals, if the wait-time means the seller is now more motivated.
Also, sometimes a great deal gets hidden due to human error. Keep in mind that sites like realtor.com and redfin are fed by local MLS systems, which in turn get fed by fallible humans. If a listing agent mistakenly claims a home has only 3 bedrooms and no basement, when in fact there are 4 bedrooms plus a basement, a stinker could suddenly become a smoking hot deal!
Los Angeles, CA · Member since 2015 · 197 posts · 59 votes
10y
It really depends on the local market. Here in Los Angeles great deals rarely make it to the MLS and are snatched up quickly once they do. Sometimes listings linger for a while because the asking price is too high. Bottom line is that nothing is a good deal unless you have it under contract, but I suppose that's semantics.
Rental Property Investor · OK · Member since 2015 · 316 posts · 216 votes
10y
I would also say, yes, definitely. This is completely anecdotal, but the first property I bought in one of my partnerships was a half duplex that had been on the MLS for nearly 6 months. My partner and I were convinced we were missing something, but the numbers looked really good. We pulled the trigger and now have a completely renovated rental, being all in at 70k, and get $995 in rent. To this day we still aren't sure why we were able to get that deal, but it looks like a combination of a bad realtor, bad tenant and bad landlord.
Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
10y
Every MLS listing has a DOM(days on market). The bigger it gets, the more suspect your "good deal" becomes. Starting with a greedy asking price is a fundamental mistake from which it is difficult to recover and you create a negative marketing spiral - -
wait 30 days to learn, oops too high
so adjust the price which signals the mistake and
if another 30 days lapses,
you just signaled there's something wrong with the property (when in fact that's not true at all).
Alpharetta, GA · Member since 2015 · 15 posts · 1 vote
10y
Ok good thank you all, now I won't be scrolling thru saying how can this be on the market for this long? Also, another question on these sites, I looked at a property on realtor, checked the schools around, they were ranked 1, 3 and 3. Checked the same property on zillow, the schools were rated 6,6 and 8...Where do you go for reliable data especially on how much houses rent in that area and how the schools nearby are rated?
Thank you.
Real Estate Agent · Highland, UT · Member since 2015 · 407 posts · 272 votes
10y
In my area some listing stay on the market for a long time because they are short sells and the agent is using them to get leads for buyers. Technically the short sell isn't under contract until the bank accepts the offer. If the house already has an offer on it accepted by the seller but not the bank it's not under contract so it can still be marketed.
Investor · Berkeley, CA · Member since 2015 · 10 posts · 3 votes
10y
Yes, especially because sometimes the seller is super motivated/frustrated by then and will take a much lower offer than they would have earlier on. Good luck!
Buy and Hold Investor · Nashville, TN · Member since 2013 · 264 posts · 102 votes
10y
I've found good deals on the MLS even in Nashville's red hot market because of complications (only wanting to sell to owner-occupants) or mistakes (listed in 37207 when it's really in 37206 -- big difference between those two zips).
In slower markets it seems to be standard for stuff to sit for a month, two, or six.
Real Estate Agent · Las Vegas, NV · Member since 2015 · 2k+ posts · 1k+ votes
10y
the great mystery of the mls ,which everyone has gone through,is whenever i put an offer on a property thst has been on for a while,I find myself in a muliple offer situation.
Alpharetta, GA · Member since 2015 · 15 posts · 1 vote
10y
Steven, you mean like putting in an offer for one property and that same offer goes to multiple properties? Mmhh that is a bug in their system, could they do that on purpose? No I think it's a system issue
Investor/Landlord · Farmington Hills, MI · Member since 2011 · 1k+ posts · 1k+ votes
10y
I have purchased properties that were on the market a long time that were coded for the incorrect map coordinates. If the map coordinates make the property look like it is in a less favorable school district it may sit for a while. Sometimes listings count bedrooms that don't have closets--an owner/occupant who needs that bedroom will not be a buyer so the house sits. Sometimes they will count a lone toilet without any walls or a sink in the basement as a half bath. Sometimes they will miss a basement that is prepped for a bath which can be added at little cost.
Steven, you mean like putting in an offer for one property and that same offer goes to multiple properties? Mmhh that is a bug in their system, could they do that on purpose? No I think it's a system issue
No I mean that all of a sudden multiple offers come on the property that has been sitting on the mls for many days after my offer is submitted
Real Estate Consultant · Chattanoooga, TN · Member since 2008 · 194 posts · 52 votes
10y
@Account Closed The answer to your question is yes you can double close on the property that is listed on the mls. That means though you would have to fund the first closing before you could sale the property in the second. In Tennessee what I have been told is that our TAR contracts are all assignable. I am an agent myself, and I have a company that has a contract on a house right now. I already have a buyer for it and we have done a contract with him. Our closing is schedule for next week right now, so I will let you know how that goes. My plan is to assign the original contract over to the end buyer.
Real Estate Consultant · Chattanoooga, TN · Member since 2008 · 194 posts · 52 votes
10y
@Maurice Mugabo One of my search criteria on the mls is for REO properties that have been sitting on the mls for 120 days and I have another for 90 days. I am now playing around with estate sales that have been on the market for over 200 days.
Investor · Portland, OR · Member since 2013 · 143 posts · 105 votes
10y
They can, especially if you are willing to take on properties that others are not. I will be closing on a 6 unit in a few weeks that has been listed off and on for 4 years. The problem is the rents are severely under market, the property has a meth lab in one unit, trashy tenants in the other 5, and the listing Realtor is a buffoon. In addition, the property taxes are extremely high and all said and done the numbers don't make sense. Because of those problems, it has had only one offer in the last 4 years, which fell apart because of the high taxes. I came across it and contacted the dept of assessment and taxation who informed me, after having them dig into the legal coding, that the taxes were way higher than they should have been because of sewer assessments, but they didn't know what that meant... After calling the sewer company and bouncing from supervisor to supervisor I was told, in the most uninformative and general terms, that since the property is in a grey area where another utility supplies the water, they have no recourse, like tuning off the water, when the sewer bill doesn't get paid. And that this sewer bill "may of may not have been paid in a long time... like years." So that bill and fees are applied to the tax bill. The assessment is considered additional taxes and are indistinguishable from the rest of the tax bill unless you dig into it further. Apparently, since the utility provider is part of city government they can handle it that way instead of placing a lien on the property. At any rate, the taxes went from over 18k to under 7k, a total savings of almost $9000 per year... AND now that the title company knows, she has to pay off the back sewer bills on closing as well as the property taxes. All said, after the first year of rehab and re-positioning, I will be looking at around 80k in equity above my down payment, and about 22% cash flow based on my initial investment...
Investor · Cincinnati, OH · Member since 2008 · 319 posts · 243 votes
10y
Of course there are deals to be had on old listings. Part of this is in how time effects the psychology of the seller. @Jeff B. mentioned the downward spiral of an improperly priced house.
You can kinda get in front of the price drop though. Essentially capitalizing on the inefficiency of market communication. Lets say the owner was thinking about dropping the list price by 20k, you offer something that is 25 or 30k under list price. Only legit offer they have received in 3 months. They are likely to take it very seriously. Lets say you waited for the 20k price drop though. Then you are competing with other people who also saw the price drop.
Investor · Orange County, CA · Member since 2015 · 2k+ posts · 3k+ votes
10y
I bought my primary residence off the MLS and it had been on there for over a year. They put it on for way too high, it was a cosmetic fixer that they didn't want to spend a dime on to get market ready and yet wanted a full blown turnkey retail price. Of course, it didn't sell, so they lowered the price. Only by the time they lowered the price the market was tanking, so they were chasing the market down for months. By this time everyone assumed there was something majorly wrong with the place when really it was only mispriced so it fell off the radar. Then in 2012 they did one last price reduction as the market started going up ... they finally caught up with the market. We came in and offered well below their finally reasonable asking price and because by this point they wanted to be done with it they accepted our offer. The house appraised for far more than our offer, which rarely happens.
So, long story short, yes, it is possible to get a good deal on a place that has been listed a long time. Not sure that this type of scenario would apply to today's market, but I could imagine other scenarios that would apply in today's market and most involve over pricing the listing initially. The other scenario that comes to mind would be short sales; if the bank finally approves a sale price and it is a good deal but the buyer with the approved offer falls through for one reason or another.
San Antonio, TX · Member since 2009 · 3k+ posts · 1k+ votes
10y
What makes a deal is very subjective. Everyone has different criteria. Though, it's possible a deal may sit. It's just finding someone who sees the opportunity. Good luck!
Merrillville, IN · Member since 2015 · 15 posts · 0 votes
10y
Thanks for this thread, Maurice Mugabo It's something I've been wondering about. I analyzed a property that seemed like it could be a good deal but stopped myself because it had been on the MLS for about 5 months.
Alpharetta, GA · Member since 2015 · 15 posts · 1 vote
10y
@Robert Cornoyer, @Pyrrha Rivers, you are welcome...yes this is what was coming to my mind for most of the properties that I looked at, so I said let me ask...great responses, thank you all... Another thing is, where does Zillow get those rents estimate? They always seem to be high, am I right? Where to go for good information about rent in any given area? Thank you...