Short Sales - "The Perfect Storm"?

Foreclosures, Short Sales, Tax Foreclosures
1

Over the past few days, I’ve been searching online for deals, in various Counties in my State of Florida (searching classified, realtor.com, MLS, etc.).

And here’s my observation, that I wanted to share with you all here:

I found a nice duplex (short sale) listing. This 3200 sq. ft. duplex on a large lot, in a nice suburban area and just a couple of years old (…and with a little due diligence: no Chinese drywall, no assessments or back taxes or other major issues of note).

So why am I posting this information to you all?

Well, I further noticed, that this real estate agent, had another 60 listings (most were also short sales).

I called the agent’s assistant, Lisa to learn that this agent turns over these short sales every couple of months, wow!

So I said to myself, “let me get this straight”? An agent in a small South Florida community, is able to get 60 short sale listings over and over again, and these listed short sales average just a couple of months on the MLS, and then sold? Yikes!

This agent is working with investors that are doing “big business” with her (the agent) month after month.

The more I looked, the more I see short sales everywhere.

So, is this the “perfect storm” for you? (The investor!)

I think so!

RD

2

first off, we avoid realtors completely. for one reason, they want it to sell for the highest possible price so they get more commision. conflict of interest there, secondly, most dont even do anything, they just load up their pipeline and see what sticks (hence 60 deals). there is NO way one person can handle 60 short sales, just isnt possible, not in the way you are going to get it for the best price, BIG DIFFERENCE between negotiation of a short sale, and just putting in a high offer that appears to be a “short sale”. see my point. do yourself a favor, avoid the realtors, find the deals yourself, NOT on the MLS. clean slate, name your own price. no bs to deal with realtors.

:beer

3

Short sales can be a nightmere. You can find deals but you are better off buying at auction, as an REO or straight from the seller. If the listing agent writes your offer then they can double side the commission and often they will work hard for you. But that doesn’t mean the bank will except your low offer. I have a short sale under contract for the last 2 months. Now a phantom lien has shown up and the owners are making a mess out of it. Total nightmere and it will likely fall through but it is one of the best deals I have ever found if it does go through.

4

Can it be a good idea for an investor to work with a realtor on their short sales? Yes. It can also get you in trouble if the realtor is steering their clients to just one investor.
Can a short sale be closed in 2 months. Yes, but most take much longer.
Can a realtor get 60 listings? Sure, but all these things are not happening here everytime. This agent is not coming close to turning over all his listings every 2 months. You can check out the deals he closes.

And is the phrase “perfect storm” one of the most annoyingly overused phrases? YES! :slight_smile:

5

It’s very possible to work with realtors. I’ve got quite a few presentations and discussions on my site about how to work with them succesfully. They can take over some of hte workload allowing you to build a larger pipeline… but they also eat into your potential returns on your investments. So it’s an individual choice.

Positives:

  1. Remove some workload from you
  2. Can be actively finding leads
  3. Allows you to increase your pipeline for more deals

Negatives:

  1. Less control
  2. eats into returns
  3. may not be desirable
  4. you are correct on the possible conflict of interest, but it can be mitigated by volume. Your involvement is supposed to make the realtors life easier, right? (win-win)
6

There are a LOT of investors out of the Florida area who do short sales. Just search for Nathan Jurewicz, Chris McLaughlin, Jason Medley, Kris Dehnert, the list goes on and on. Most of them sell large information products about short sale strategies and such. They have an impressive social media presence. It isn’t really the perfect storm it is made out to be for the vast majority of people although some make it work.