REIClub members,
Ok so was doing some reading today and was kinda shocked at what it said. Don't know if its true so if any of the more knowledgable investor's can confirm or deny it let me know.
What it said was that Realestate agents list their shortsale properties at ridiculously low prices to draw traffic to thier listings. It also went on to say that these prices are not approved by the lender. Is that ethical? I mean if this is true and buyer's are inquiring about these great "deals" they're seeing. Isn't that wrong? I know I was drooling at the mouth viewing Shortsale listing at realtor's websites.
Can anyone offer any opinion or info on this subject? Thanks in advance.
Glenn Boyce
Hi,
Realtors have been offering short sales in partnership with sellers and lenders to attract traffic, then try to get the "Bring Best Offer" scenerio!
It’s the same thing you and I want as sellers; buy property for a dollar, rehab for 5 dollars, list - market and advertise for 10 dollars and create bidding war between buyers who “Gotta Have It” for 50 Billion!!!
The lender is looking for best offer the market will bear! The realtor is marketing and advertising to get the greatest response, and in a competing property with multiple buyers it ensures the property is going to recieve the best market value offer!
I have made offers for thousands above the listing price making best and final offers against as many as a dozen or more investors!
Supply and Demand? (I am not refering to the huge supply of $25k homes in a questionable neighborhood, but to the great neighborhood with very, very limited supply of homes and models, with huge margins after repair value, making the property extremely desireable to large numbers of investors.)
In real estate it does not matter what you pay or whether it is an up or down market as long as a profitable known profit can be achieved!!!
Good luck,
GR
HI,
Can you tell me that why this false listing is there and why agents dop such?
What the profit they get for doing so?
Glenn
Good to chat.
The price at which the listing is listed at is dictated by the Seller… At times a low price offer, especially when its a Short, can begin to manipulate the value the BPO comes in at and at the same time increase the value in which it is resold…
Its a strategy which works well.
Happy hunting.
Michael
michael,
Thanks for letting me in on 1 of the tactics used to manipulate the BPO and ultimately the value of a property. But what if that tactic ultimately works to the detriment of the seller? For instance...if the bank approved a real lowball offer wouldn't that put the seller in jeopardy of owing the difference between sale price and amount owed on loan? Isn't it in the best interest of the seller to get as much as he or she can to satisfy the lender?
And from what i read in the article i mentioned was that these realtor's were listing properties for ridiculously low prices just to drive traffic to their websites and phone lines. Knowing full well that bank never agreed to such low offers. But looking at your perspective definately puts a different spin on how the article could be construed as meaning. Just trying to understand and sponge up all information i can get. Thanks again!
Glenn Boyce
It’s a long process, but ultimately the seller knows vaguely what he’ll be owing. The seller comes up with the price with the Realtor, the offer is approved by the seller first, and then it goes to the bank to see if they’ll accept it. It’s not just the Realtor and bank making deals and the seller getting screwed.
I am not seeing the seller getting screwed here…