A million short sales in 2013? I doubt it and here’s why.

By
Real Estate Agent with Better Homes and Gardens Real Estate Metro Brokers

A million short sales in 2013? I doubt it and here’s why.Some prognosticators have predicted that the number of short sales completed in 2013 will double the mark set last year and approach one million for the calendar year.

Full disclosure: I am NOT an economist. I am NOT a statistician. My rebuttal is not predicated on anything more substantial than common sense.

But here are my reasons that we will not see a million short sales this year:

First and foremost, the system can’t handle the volume. There isn’t enough infrastructure in place to successfully complete that number of transactions.

Second, most of the pre-2006 investors are already out of the game. We are seeing less of these kinds of “bulk” short sales these days.

Third, many properties are getting closer to the “treading-water” mark and the sellers are less likely to succumb to the rigors of short-sale scrutiny, and will opt to test the market in hopes of a non-distress sale.

And finally, and this is the one where common-sense applies the most, many of the over-appraised, high interest rate loans have already been converted to lower principle, lower interest loans either by attrition or modification. Five years is a long time in a world where the average seller has owned their home for about seven years anyway.

I could be oversimplifying the situation. Perhaps I am missing something obvious.

Only time will tell!

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Tammy Lankford
Your Lake Sinclair Expert (706-485-9668)
Lane Realty

our area never had a huge % of them.  Now if we can get throught he flood of foreclosures in our market, we can get back to the business of real estate.  And the fact that I thought and still think they will come to an end is exactly why even though I learned them, I did not put all my eggs in that basket or market myself as a short sale "specialist"

February 28, 2013 01:49 PM
Rainmaker
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Nancy Conner
Olympia/Thurston County WA
Managing Broker - City Realty Inc
I think you're right - we're seeing declining numbers of short sales in our market, with low inventory starting to nudge prices up a little bit. The other thing I've realized is that when anyone talks about the number of properties that are "under water" as being part of potential short sale numbers, that ignores the fact that many under water homeowners are doing OK making their payments and have no need to sell at this time. And still others have the ability to make up the difference in amount owed and amount they can sell for, so do not need to do a short sale either.
February 28, 2013 03:08 PM
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Brenda Mullen
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RE/MAX Access

I would have to agree with you Richard.  I don't see short sales going up that much.  The market is improving a bit and those who would have had to do a short sale before are now able to get by selling with no money out of pocket. The short sale process across the board has seemed to get a bit better, but a million is a bit much.  

February 28, 2013 06:10 PM
Rainmaker
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Kathy Sheehan
Movement Mortgage 770-634-4021

Richard, I don't see the number of short sales doubling... in fact the last three contract I received are seller owned, not REO properties.

February 28, 2013 07:02 PM
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Bryan Robertson
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Catarra Real Estate, Inc

With property values rising in many of the hardest hit markets, I doubt sort sales will be much of an issue in 2013.  Even in some of the hardest hit areas of California, values are coming back.  I think the economists making these predictions are just guessing based on a few stats and not reflecting the rapidly recovering market.

 

March 02, 2013 08:02 AM
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Richard Weisser

Richard Weisser Coweta Newnan Homes for Sale
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Additional Information

Author Bio: Richard Weisser is a Georgia real estate broker, licensed auctioneer, and has been writing about Georgia Real Estate since 1999.

Coweta Fayette Real Estate offers opinions and helpful information to consumers and real estate professionals in the Coweta County Georgia area.

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