Short Sales-Pricing Them to Sell isn’t Rocket Science

By
Real Estate Agent with Integrity Real Estate Group

Short Sales-Pricing them to SellOver the last few days I've had a number of calls from agents on my Belmont Bay short sale listing  Some of them have asked the important questions about the short sale package but most of them have skipped past it and asked "so what will the bank take?"

In fact pricing a short sale listing is the same as pricing any other listing.  You can list it low, you can list it high or you can list it in line with the other comps in the area.  If you list it low sure you can generate multiple offers, which on a short sale isn't always the best way to get the bank to act or you can list it high and give a buyer the opportunity to feel they are getting a deal by making a lower offer.

However if you price it right and the bank sends out an appraiser who says "yes it is priced right" you have a much better chance of getting your deal closed.  So when an agent asks "so what will the bank take" my answer is always going to be "list price."  Protesting that the bank should be "happy" to receive a cash offer of $50,000 to $75,000 isn't realistic and I wouldn't be doing my duty to the seller by telling them to accept it. 

Though I don't list short sales by the dozens I did just get an approval back from the bank on one in 14 days recently.  The appraisal supported the contract price which I think made it a "no brainer" to the lender.  As we see the percentage rate of short sale closing move upward I think more agents have gotten the message that short sales need to be priced where the market dictates.  Pricing them low or pricing them high isn't going to get you to closing.

Check the comps before you ask "how much will the bank take?"  If the property is priced right then, say YEA and know your client has an opportunity to get a nice property at a great price.

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If you are interested in learning more about the Northern Virginia Real Estate market including Alexandria, Arlington, Fairfax and Prince William Counties give Cindy Jones and Integrity Real Estate Group a call at 703-346-2213.

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Topic:
Real Estate General Information
Location:
Virginia Prince William County Woodbridge
Groups:
Dedicated Bloggers
Northern Virginia Real Estate
Realtors®
RE/MAX Active Rain Bloggers
Virginia Foreclosures Short Sales and REO (and Pre-Foreclosures)
Tags:
belmont bay
short sales
woodbridge
prince william county real estate

Comments 13 New Comment

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Rainer
36,487
Donald Wenner
Keller Williams Maplewood Mid-Town Direct

Good Morning Cindy,

Good information on short sales.  Pricing the property right HAS to be the key.  But hearing back from the lender in 14 days?  Does that qualify for some type of record?  Seems quick in comparison to many I have heard of.

DW

March 28, 2009 08:04 AM
Rainer
46,946
John Secor
EXIT Real Estate Results

Cindy,

I'm listing 2 short sales today.  Both are in low income areas with minimal recent sale activity which makes the CMA almost useless.  In this case I must go with my gut and see what the market tells me.  I will likely list them priced with comparable actives rather than comparable sales and adjust as opposed to listing them low initially.  Sometimes it's a crap shoot, not a science.

March 28, 2009 08:25 AM
Ambassador
1,806,999
Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
Integrity Real Estate Group

Donald-I'm not sure it was a shock to me to see the letter and get the VM telling me it was approved.  Now I can't wait to see if the buyer agents survives the shock.

March 28, 2009 09:47 AM
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Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
Integrity Real Estate Group

John-I suspect your gut will put you close to the right price.  I'm still surprised when I see listings that are so undervalued as they only thing an agent can think is that someone is trying to start a bidding war.  I've seen that tactic turn off many buyers.

March 28, 2009 09:50 AM
Rainmaker
73,175
Maria Mastrolonardo
Realtor, Naperville, IL Real Estate
RE/MAX of Naperville

Cindy - Your right, with all listings price is everything. I tend to be on the conservative side when pricing, especially a short sale.

March 28, 2009 10:35 AM
Rainmaker
113,956
Peg Gilliland
Broker, GRI, CDPE
Charlottesville Solutions

Wow thank you Cindy for the great update on the topic.

-Peg <(-.-)>

March 29, 2009 04:46 PM
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Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
Integrity Real Estate Group

Maria-pricing short sales is like Goldylocks and the Three Bears.  Price them just right and the lender might just approve the sale!

March 29, 2009 07:47 PM
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Todd Clark
Broker - Beaverton, Oregon Real Estate Expert - (503) 524-9494
Keller Williams Realty

I think we are also getting more and more banks willing to listen to us if we play fair with them as well from the start.

 

March 30, 2009 12:14 AM
Rainer
151,302
Ken Montville
The MD Suburbs of DC
RE/MAX United Real Estate

It always nice to have a responsive bank (and to think that two weeks is now considered speedy). But finding the right bank or loss mitigation specialist or whatever to work with the listing agent to move the house may not be rocket science but it may be more like a trip to Vegas -- a real crap shoot.

March 31, 2009 09:47 AM
Rainmaker
312,527
Carol Culkin
Overland Park
Reece & Nichols

Cindy - Yup, pricing it to stand out - that's what is key for short sales ...and the traditional sellers need to know this to compete with short sales. Unfortunately, it's a viscous cycle.  

March 31, 2009 03:27 PM
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Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
Integrity Real Estate Group

Todd-they do seem to be more responsive than they used to.

March 31, 2009 08:15 PM
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Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
Integrity Real Estate Group

Ken-on this particular deal the initial response came quickly but there are a few sticking points that are keeping us from jumping up and down with glee.

March 31, 2009 08:16 PM
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Cindy Jones
Pentagon, Fort Belvoir & Quantico Real Estate News
Integrity Real Estate Group

Carol-I think if you price them according to the market and don't try to play games with the lender and potential buyers you are more likely to end up with a positive outcome.

March 31, 2009 08:17 PM
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Cindy Jones

Pentagon, Fort Belvoir & Quantico Real Estate News
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