Short Sales, The Good, The Bad, and The Ugly

Generally speaking, you should view all available options to you on the San Diego real estate market so that you can make decisions on which home you’d like to purchase.

Here is the catch…

Sometimes these short sales are really deceiving.  Often they advertise a sale price that is completely out of whack with the market.  Almost 200K less than the last sale on a 330K appraised value?!  What does that do to a person’s property value?  It makes the real estate market worse than it needs to be.

And the ugly part of this is that recently it appears as though quite a few agents will tell you that they are taking your offer on the short sale.  Then they drag out signing acceptance on the offer or they put the property into “contingent” status and just a few days before the bank approves the short sale, they put the property back on the market to collect more offers.

Why?  Fear.

So often buyers walk over the slightest whim.  They submit an offer and then change their minds.  They are hesitant.  There are options, and sometimes they get cold feet.

The agents working for the sellers know that, and in order to protect themselves and their clients, they get in as many offers as possible.

The really ugly is when your client waits all 6 months for the property to be ready to go into escrow and is beaten out by another offer out of nowhere after changing the property status from “contingent” to “active”.

It’s a tough racket out there, and I always recommend that buyers continue looking at other properties if the short sale won’t commit to them.  The ugly is that sometimes they fall in love with that property and nothing else compares, no matter what you tell them.  Until they are left with empty promises of a potential short sale and empty hands.

Please, be very careful when writing offers on short sales.  No one has really formalized a system for working them, they are wild cards.  Sometimes they work, sometimes they don’t.  Don’t get your hopes up, that San Diego dream home might have just passed before your eyes.