In a mere 2 months, the average price per square foot has dropped 5% (for the homes I track that meet my criteria in Folsom and El Dorado Hills). There were some substantial price drops in the last two weeks, and I am now seeing several familiar listings coming back on the market after taking a winter break. Now that my sample size has grown significantly, I think these statistics can be interpreted as more indicative of the broader market (albeit the lower end).
On the flip side, there art a lot of homes in escrow right now. However to give a little context, last March was also the record for my pending to total ratio (34%, with 22 pending and 43 available). The main difference is that there are so many more homes that fit our criteria now. With 50 homes pending and 102 homes available, for a ratio of 33 pending%.
But here is the kicker....by early May 2007 that ratio had dropped down to 18%, one of the lowest points of the year.
Separately, our home search is on hold for a month while we wait to hear from the bank on the short sale we submitted. I'm not too hopeful, as the seller thinks the offer is low (of course its all semantics, since I think the offer is very reasonable). We actually lowered our original offer once we agreed it would be a short sale, to cover the "as-is" factor as well as the fact that short sales take several months to work out.
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A month? ask around as I hear maybe 2 months is norm to hear on a short sale...
Your offer should expire in a few days so if you find something else, I wouldn't hesitate to submit an offer and possibly cancel the other.
Short offers usu only get accepted if the agent can show "comps" - a valid reason for the bank to accept the number.
Good luck!
Sippn, are comps the only criteria or are their others? Before we put an actual bid on a home, we do research and put together a 'case' for my bid. It would be nice to know other 'valid reasons'.
Regarding the time frame on a short sale. We put in an offer on a short sale home in Folsom that was on the market for over one year at the beginning of December 2007. Went through all the hoops, extra paper work, discussions with the owners, agents etc.
Two months later we got a negative reply and the next week the house goes pending.
BTW, it is still pending over a month later.
LIke I said, working with short sales sucks...
The bank may not even know its on the market and of course, is owed more. They don;t have to agree if the seller is able to pay the mortgage payment anyway.
What you describe I believe is typical.
"Comps" establish value. Now days, many comps are damaged anyway, already discounted.
In the old days, to get a great deal, you would find a seller who really needed to sell quickly, but had enough equity to get below the comps without shorting the loan.... then its just the seller's decision, not a bank committee.
There are still homes for sale like this, easiest to buy quickly....still have light fixtures, ha!
Sippn -
You also forgot to mention that most agents hate to do them since their comission is set by the bank.
Luckily we aren't in a hurry. I have another year and a half before my daughter starts kindergarten.
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