HUD homes: Investors can only bid in EXTENDED listing period?

Foreclosures, Short Sales, Tax Foreclosures
1

There are several listing periods: lottery, exclusive and extended.

To clarify the only listing period in which a wholesaler may bid on the property is in the extended period correct?

2

You need to look at the definitions for what those terms mean in the context of that listing. For the HUD homes we’ve bought and watched, it simply listed a period as an owner occupant period before it opened up to investors. If a person gets an accepted offer during an owner occupant period, they will have to sign a paper at closing stating they intend to occupy the house for at least one year.
If I had to guess in your case here, I would say exclusive was only for owner occupants and the extended would be the period opened up to investors.

3

Thanks for your reply Justin, that does seem to be the case I just wanted to confirm it here. In fact I confirmed this on the HUD FAQ, extended is indeed the only listing period open to investors.

When a HUD property is in an exclusive listing, and the exclusive listing expires and the property moves to extended listing, does that come with a price drop in the listing price? Does the property drop in listing price moving from exclusive listing to extended listing to try and get the property moved?

Thanks

4

If HUD list the property will a real estate agent the price could drop.

5

@Realestateseller
With all due respect that did not answer my question. When a HUD drops from an exclusive listing period to an extended listing period, does that usually correspond with a drop in listing price?

6

Sometime HUD will discount the home if it been on the books for a long time.

7

Samantha,
My experience with this has been the following:
House is listed by HUD for a certain amount (let’s call it price #1) and open only to owner occupants for a certain length of time. After that length of time, they can either extend it for owner occupant or they can open it to investors (the extended time frame you asked about). If it still doesn’t sell, they will likely drop the price some (price #2 now) and then restrict it to only owner occupants for another set period of time. This cycle repeats until the house finally sells.
I’ve seen it happen where the process is almost mechanical in that the price goes down by so many thousand or a percentage for a period of time and then it drops another few thousand after a few weeks so you can actually watch the price walk down over time.
The other thing I’ve noticed is that the website seems to reject bids unless they’re a certain percentage of the list price. My Realtor told me it’s usually around 85-90% of list price.

8

It mostly depends on the HUD determining whether they should still extend it or not… in terms of listing period.