Are foreclosures truly a bargain?

Steve Brown talks about auctions in the Dallas Morning News today.  It's a good overview of the auction process but also echoes what agents have been saying for the past six months:  don't expect foreclosures to be priced at 50 cents on the dollar.  Why?  Because the mortgage company owners have done their due diligence and know what the market value is.  The list price is typically about 85% - 90% of the market value and that's the amount the mortgage company is looking for.

Auction properties, as Steve points out, most often are properties that have already been marketed for a lengthy period of time and weren't purchased.  For those homebuyers or investors who don't mind major repair projects, auctions can be a good resource for a property.

What caught my attention in this article was Steve's guidelines for finding foreclosed properties:

1.  Contact a local real estate agent.  (I say this a lot, but I'd add, not just any agent, a Realtor, preferably a RE/MAX Realtor.)

2.  Watch for auctions.  You can get a list of auction sites from your Realtor.

3.  Shop government listings.  I routinely direct clients to the local HUD site and several clients have bought HUD properties which were very good values.

To quote Brian Buffini, "a recession is a terrible thing to waste".  It certainly has directed a spotlight on foreclosures and for some buyers, it could be happy ending. 

 

A Realtor really IS your new best friend

Most likely you know someone who has lost their job or may be aware of someone who's near the edge financially and trying to keep up their mortgage payments.  Millions of people are swimming in debt, barely treading water.

1.  Your mortgage:  There are options available to people who are having difficulty paying their mortgage.  One possibility of course is selling the home, but there are others.  

2.  Credit issues:  There are reputable companies available to help you turn your credit around, sometimes in as little as 90 days.  

The best advice I can give you is to make sure those you love and care about know that there's help.  Engage the services of a professional Realtor who can provide information and guidance now -- before it's too late and foreclosure or repossession becomes a harsh reality.

Is it over? (the recession)

It's glorious to wake up and check the national business journals to find an actual positive headline.  Today the Washington Business Journal says that new construction was up 22% in February.

While that's not where I live, I want to capitalize on every piece of positive news available as counter to the tsunami of negative reporting.   My region is the south and it's also positive -- housing construction permits up 5.9% from January.  Unfortunately sales in February were still slightly down from a year ago in every suburb in the Dallas metro area with the lone exception of Celina (Source:  NTREIS Activity Report, February, 2009).

Real estate is not only local, in a large metropolitan area like ours, it varies widely from suburb to suburb.  Park Cities sales are down 48% in February from a year ago; the far north Dallas (north of LBJ) area is down only 5%.

So is the recession over?  A client told me on Monday that it was.  He's an economist; I'm not.  His statement was based on the fact that "people are beginning to ask if it's over, and that's how you know it is".  This is what I know:  I talk to new buyers and sellers every day.   Our market may not be moving quite as fast as last year, but it's definitely moving.  And in a good direction.

For a copy of the February, 2009 NTREIS Report (MLS report), click here.