Shadow Foreclosure Inventory impact Sellers

By
Real Estate Agent with Re/Max Southern Shores
Yesterday a financial planner was consulting with one of our buyers interested in a home in a desirable neighborhood in Myrtle Beach, SC and she reiterated a key point and change with lending institutions regarding foreclosure inventory. Banks have been holding many foreclosures, getting them ready to sell, and releasing slowly so not to flood the market. However, Bank of America just announced they will change from releasing 7500 foreclosures a month to 45,000 (THIS IS HUGE, BUT THERE IS TIME TO REACT). In addition to the shadow inventory, also referenced as "black cloud" inventory, there are the other foreclosures banks are assuming daily. In Myrtle Beach, SC and elsewhere, prices are not increasing anytime soon ... but just the opposite due to the foreclosure inventory. I too have turned my head at the words "double dip recession" but the numbers are staggering. Foreclosures are selling because they are priced at 57% of a properties' value (SHORT SALES ARE 87% OF PROPERTY VALUE ON AVG.). Therefore, it is only FACT that a home someone paid $300,000 for could be valued at $171,000... JUST A REALITY. *Experts predict foreclosures WILL dominate the market until 2012 and recovery will begin in 2013. *APPRAISERS ARE CHECKED BY LENDERS TO USE FORECLOSURES AS COMPARABLES -FORECLOSURES COULD BE COMPARABLE SALES FOR YOUR HOME/PROPERTY HOW CAN WE SELL YOUR PROPERTY in Myrtle Beach REALIZING WHAT THE FUTURE MAY HOLD: 1. PRICE TO SELL... ALLOW SMALL ROOM FOR NEGOTIATION. (EX. PRICE AT $170,000 INSTEAD OF $200,000 IF YOU WOULD TAKE $165,000) 2. ADD A SELLER'S AGENCY BONUS, PAY BUYER'S CLOSING COSTS, BUY DOWN BUYER'S INTEREST RATES (WE HAVE TO GET CREATIVE); OFFER OWNER FINANCING, OFFER TO HOLD A 2ND MORTGAGE 3. MAKE YOUR PROPERTY EASY TO SHOW; KEEP IT CLEAN & CLUTTER FREE; LIGHT & BRIGHT This info. is to help you prepare for the future. If you want to sell, prices are not predicted to improve for 3 years, so make the changes necessary to move forward. In Myrtle Beach prices have dropped 7.8% per sf & 23.8% on average over the past year. Myrtle Beach currently has 4513 resales on the market and 561 in the pre-foreclosure or foreclosure process. Myrtle Beach home sales have decreased 63.8% over the past year. Want to sell... price to sell... want to buy... NOW IS THE TIME. For the folks who have saved and have money on hand, the future is yours. Search local properties for sale at www.myrtlebeachrealestatetoday.com/ for foreclosures & all properties in the area.
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Topic:
ActiveRain Community
Location:
South Carolina Horry County Myrtle Beach
Tags:
myrtle beach foreclosures
myrtle beach homes
myrtle beach shadow inventory
myrtle beach economy

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Rainmaker
967,339
Gary L. Waters, Broker Owner Waters Realty of Brevard, LLC
Personal Service, always.
Waters Realty of Brevard, LLC

Banks releasing a massive foreclosure inventory can be seen as a quick solution but it will kill the "normal" seller for a period. I am not sure I believe anything BoA says!

June 10, 2010 08:35 AM
Rainer
163,506
John Franc
Honesty & Integrity in all I do!
John Franc Realtor ABR Smart Way America Realty

We are in the same situation here in the Poconos.  Short-sales & foreclosures continue to dominate the market.  If that "black cloud" does burst then the fear of the "double dip" will likely occur.

June 10, 2010 08:44 AM
Rainer
2,593
Linda S. Lin

It looks like the foreclosure houses have been increased everywhere, even in Nebraska.  It's sad to see the property value going down so dramatically, but for the investors, this is a GREAT time to buy.

June 10, 2010 08:45 AM
Rainmaker
1,346,764
Andrew Mooers
Northern Maine Real Estate-Aroostook County Broker
MOOERS REALTY

So so different in Maine...don't have the foreclosures with low low priced homes and most folks with no mortgage, a small one when the price tags are so low. Saving money, not having everything under the sun is a simple lifestyle others could adopt, benefit from. Golden handcuffs...you don't see them in Maine.

June 10, 2010 08:54 AM
Rainmaker
26,883
Terry Adams
Condolux Real Estate & Vacation Rentals

Some of those tips sound a bit dicey. I hope it all works out.

June 29, 2010 02:01 PM
Rainer
14,672
Darrell Catmull
Destiny Real Estate

Interestingly enough Asset Managers instruct their agents to NOT pick short-sales and REO coparables.  They are adiment about this because they want to get the highest price they can in 120 days.  Its an urban myth that foreclosures are good deals by default.

Banks rely on the BPO agent or appraiser to select non-distressed sales we should trust that foreclosures are first competing at the same prices of non-distressed property and only consider reducing their price at 30/60/90/120 days.

 

July 15, 2010 09:33 AM
Rainmaker
1,002,783
Charles McDonald
REALTOR®, Blogger, Principal Broker®, Owner
Charlottesville Real Estate Solutions

Wendy

we miss seeing you in the rain, I hope all is well in Myrtle Beach!

your friend in Charlottesville

August 25, 2010 09:29 AM
Anonymous
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Rainmaker
60,675

Wendy Hodges

Davis & Hodges
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