What I am seeing happen occasionally, the bank just doesn’t bid at all, and man are the guys buying these getting good deals. I’m watching 200K houses sell for 100K, sometimes even better. The craziest of these deals is going on right now. A builder who went tits up is losing all of his lots with partially built homes. There is 10 lots secured by this deed of trust which is listed at 1.4 Mil. The local bank just didn’t bid it up for who knows why, and it’s in the “upset bid” phase (unique for NC I think) for 285K right now! Crazy! After his downpayment the builder paid about 2 mil for these LOTS just a few years ago. Some of them, two I think, are even completed homes and are assessed at around 400k a piece! The others are pretty far along from what I can tell from the road. I wish I was a builder! I know the areas these are in and lets just say they will sell at 300K even in this market.
Well I wasn’t able to complete this post because it was “not acceptable” when I submitted it.
I’ve been telling you about these properties (In New England) for a year now.
I thought you said those kinds of deals didn’t exist where you are??
Just kiddin’ man… :beer
CASH IS KING!! And if you have it…
You are the EMPEROR!!!
I have just recently started seeing these deals as of maybe two months ago. I wonder what took so long for them here.
New England entered the recession well ahead of the other parts of the country. So it’s not surprising to see the better deals up here and you guy’s just starting to see them now.
It’s all about CAPITAL…The project you mentioned in your post will NOT (in all likelyhood) sell for $285,000…In my opinion, what you are seeing is the same thing that has been happening up here for over a year. Banks are placing these properties for sale at GIVE AWAY PRICING…This gets LOTS of ATTENTION from investors…Prices get bid UP…and the banks end up selling for HIGHER than that $285K. There are STILL a lot of people with CASH…Any developer wotrth his salt, saw this entire BUST coming from miles away. Developers keeps HUGE reserves of cash on hand to make BIG BUYS during these types of times. Those guys are gonna eat that property up!!!
I know I would!!!
Y9ou can USE this to your advantage…
What I do is this…I take those GIVE AWAY prices with me when I look at a property. I show them to the owner…It’s right there in black and white…Very HARD to argue with. Then I make MY offer. THAT’s exactly how I get my bargains!!
What you’re talking about just happened here on an auction last night. A house was listed for 30k on the MLS. Then I noticed it was going to auction with a starting bid of 16,750. When it actually came on auction, the starting bid was only 7,750. It ended up selling for 21,250. In our market, it was only worth about 16-17 to an investor because it was a 2/2. Would’ve been a great home for an older couple for OO. I just couldn’t justify going up that high as my rent would’ve been capped at about 525 and I already have a good inventory of 2 bdrms.
Well another one popped up. Somebody is gonna make a ton of money with these. This one is three lots with homes between 350-400K built in 2007. Builder lost them, never been lived in. They can be bought for around 400K from what I can tell. Lien check is good. It’s crazy!!! What appears to be happening, these small local banks that did the loans, just aren’t bidding at the auction to protect themselves. They must be in real trouble.