short sale

Killer Mindset For Today’s Market

Mario AvalosLeave a comment

White LionBuyer mindset for today’s market. What’s it like? How must you think to score the right deal given an opportunity?

The only way I can describe what you must be: patiently aggressive. Now…what the heck is that?

Today’s market consists of a historic low inventory. Add to that the portion that is made up of foreclosures and short sales. These type of properties are usually priced from fair market value up to 10% below it. This combination has created an outrageous demand for good homes in good areas.

Patiently aggressive buyers are like tigers hunting for deer after months of hunger. They wait for the right deal to cross their way because they know its coming. And once it comes, they don’t think. They act. They don’t plan. They execute. They don’t compare, analyze or start pondering if there is a better deal out there.

And in today’s market, for you the buyer, this is the right mindset you must have in order to score on a great deal. Ever heard of the saying, ” the deal of the century comes once a week”. Well, in this market, its coming once a month. So you must be ready.

Off-course, nothing is ever done without the right preparation. And where do you start? With a real estate agent?

Before stepping onto your car to view a single property, a real estate agent must explain to you three factors and not just simply throw you into a safari with a blessing. The three factors are:

  1. Expectations of how the market is, or how are other buyers’ conduct in buying properties so that you know how to compete in order to score a deal. Yes…as much as you may not think…this is competition. You are competing with other buyers.
  2. The process of making an offer within 24 hours from viewing the property.
  3. What are all your “ways out” of a contract after you submit an offer to a seller.

In conclusion, the above explanation is for buyers that claim they want a “hot deal”. And most buyers do. The problem is that lost of buyers and or their real estate agents are not aggressive by nature.

Short Sales Suck? Not So.

Mario AvalosLeave a comment

Short selling a property in today’s market is a whole different ball game than what it used to be a year go or so. For the better. A combination of a dried-up-inventory-market and quicker negotiation turn-around is making short sales (aka: underwater homes) that much more attractive.

Back in the day it was normal to work with a buyer’s offer without collecting earnest money upon execution of contract. The bad part about this old way to handling a short sale was that 6 months down the road, once a short sale was approved, most buyers would go MIA (missing in action). This created a mess in terms of having to re-approve the short sale with a new buyer’s name often delaying the process another two or three months.

Now that inventory is dried up and short sale departments are on the ball about getting short sales approved, they are a commodity. Considering all the bidding wars and multiple offer situations that exist in well priced properties, it can be somewhat emotionally complicated to buy an REO making short sales a good option to go after assuming a buyer does not need a home within the next 6 months to a year. Because of this, demanding (as part of the negotiation process) buyer-earnest money upon execution of a contract is a must…and buyers will wait.

If a buyer does not want to put money up front, move on to the next. And the next. And the next. Until a buyer is found that will stick with you until the short sale is approved. It’s a seller’s market out there, even if your upside down.