In the last 7 days we have watched as the prices have changed on 25 Santa Clarita Valley real estate listings. Of those 25 – 9 were price increases.
You read that right – 9 were price increases. Looking at each specific listing – It was easy to see that a majority – 8 of the listings were increases in price because of their short sale nature.
Reminder - Short Sales are properties where the “human seller” has had a life changing event. They are no longer able or desire to continue making their mortgage payments. Typical reasons this may happen are the four “D’s” – Death, Divorce, Disease, Detachment(job loss). Sometimes, Short Sales are done in a strategic fashion – but most are “hardship” in nature.
With short sales – the approval process takes time. After short sales are “approved”, which includes the “bank that owns the larger part of the loan”, approving or rejecting the offer that has been written on the short sale. This is also the part of the scenario where the bank establishes the price they want the property to sell for.
They establish the value of a Short Sale a couple of ways. They may order an apprasial – but most likely not at this stage. Most of the time they have something called a BPO completed. BPO – Broker Price Opinion. Real Estate Broker/Agent will get paid for going to a specific property that has been assigned to them. They are responsible for completing investigations about the home itself. These agents typically investigate these properties by – photographing – noting upgrades and downgrades – comparing the target property with those that are currently for sale(competition). These agents also take note of others that are currently in escrow and the Sold Listings that have closed in the past 6 months that match the subject property.
If the agent was in error in the beginning when pricing the short sale and they priced it too low – the bank will request the current buyer step up to a different(higher) price – or that buyer is kicked out of escrow. At this time, a new buyer has to be secured or listing agent will risk the property going to foreclosure.
As a buyer, it’s not a HUGE deal – you don’t lose anything but time and potentially the “home where you had hung your mental curtains”. However, Losing Time can be problematic – especially if you have not been having your real estate agent keep you appraised of other listings that may have entered the market for sale that you would have liked.
When writing offers, buying real estate, exploring your options – get the best of advice. Speak with professionals and work with local real estate agents. I have written about most “real estate related topics” at one time or another. Type your questions below into our Google Custom Search to access all of the REMAX of Santa Clarita Paris911 Team Resources.