It's A Slippery Slope To Sell Buyers What They Should Not Buy...

By
Managing Real Estate Broker with RE/MAX Executive Realty
http://actvra.in/DDM

Bank owned properties have been a phase of real estate that my team and I do not handle.  Those are listings that are ideal for investors who are set up to rehab and often totally rebuild.  Not every buyer is a good candidate for a bank owned property and they’re management intense if the listing agent is doing a good job.

I have witnessed many buyer agents working with buyers who are referred to them by friends and past clients, and those buyers are being shown bank owned properties.  Because a home is within a first time home buyer’s price range does not mean that the home is the right fit for that buyer.

Bank properties are sold “as is” and the buyer is on his/her own to correct any problems.  There are no protections for that buyer beyond the home inspection.  The listing agent knows as much as he/she is told.  There are only so many inspections that are available, and the costs begin to add up to an astronomical figure.

Bank owned properties are not for everyone and buyer agents should be very concerned if a first time buyer is interested in seeing them.  First time buyers need to be educated on this topic and shown homes that are not beyond their ability to repair.  If a buyer likes the home and you know there are problems, you’re headed down a very slippery slope, buyer’s agent!!

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Topic:
Real Estate Sales and Marketing
Location:
Massachusetts Norfolk County Franklin Top Listing Real Estate Office Re/max Executive Realty
Groups:
Real Estate Rookie
RE/MAX Active Rain Bloggers
Posts to Localism
Be The Best In Your Field
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Tags:
selecting homes for first time home buyers

Comments 24 New Comment

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Rainmaker
595,608
Nancy Conner
Olympia/Thurston County WA
Managing Broker - City Realty Inc
This is so very true! And what's frustrating to me is that some REO's are moving to an initial period where investors cannot make offers.....even when clearly the property condition really means a buyer with experience in evaluating rehab needs and costs is a much better fit - a buyer like many investors....hmmmmm.
July 09, 2012 09:05 PM
Rainmaker
725,110
Gabrielle Kamahele Rhind
Broker/Owner
KGC Properties LLC, Tucson Property Management & Real Estate

GOOD MORNING BARBARA!  Gotta get the buyers away from just looking at the price - especially on REOs.  Even experienced investors buying REOs find repair surprises - but are prepared for it!

July 10, 2012 04:12 AM
Rainmaker
779,933
Al Raymondi
Ormond By The Sea Florida - Home and Condo Sales a
Ocean View Realty Group in Ormond By The Sea Florida

Absolutely correct Barbara, there is a reason some REO homes appear to be priced below market and most buyers are not able to handle the potential problems that these homes may have.

July 10, 2012 05:15 AM
Rainmaker
204,179
Peggy Wester
Real Estate Agent Ozaukee & Washington County Real
Think Young Team--Realty Executives Integrity

I echo Carla's (#19) comment above. I'm currently working with a first-time buyer who is approved for a house in the $60,000 price point. Those simply don't exist in our area except for a few foreclosures, and those, quite honestly, are more likely than not structures that need to be torn down and rebuilt. Sometimes it takes awhile for the buyer to fully understand the work they are undertaking with any foreclosure; and sometimes they realize it's theh perfect option for them and sometimes not so much.

July 10, 2012 05:40 AM
Rainmaker
1,753,849
Gita Bantwal
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel
RE/MAX Centre Realtors

Barbara, I advice buyers about short sales and there are many questions that I ask them . The first thing they should know is that it may take months and they should have the option to continue their lease at current place on month tto month basis or move in with family.

July 10, 2012 06:25 AM
Anonymous
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Rainmaker
1,828,713

Barbara Todaro

"New Franklin MA Homes"
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Additional Information

The Kuney-Todaro Team is the "#1 team in Franklin's #1 office." Our expertise is in marketing new construction and resale properties. New construction is our niche and we have sold 40 subdivisions in the area of Franklin MA.