What Have You Heard? About the national foreclosure trends? About your local market?
Check Out These Local Opportunities • $450k • $249k • $89k
Top Three Benefits for Buyers 1.
Own Your First Home: It’s More Affordable Than Ever
2.
Invest: Values Mean Stronger Cash Flow, Better Returns for You
3.
Move Up Now: Get More Than You Thought, and Sooner
Win in Five Steps 1. 2. 3. 4. 5.
Know the language, playing field, and rules Seize the opportunity. Ignore the myths. Be ready to go. Build a strong team with your expert distressed property agent.
Know the Language, Playing Field, and Rules •
Language and Playing Field – Get Familiar with Foreclosure Terms, Players, and Motives
•
Rules – Know Them and Follow Them
Distressed Property
Rules: Traditional vs. Distressed • They’re different! – Price – Speed – Decision-Making – Communication – Negotiation
Knowing these differences will give you clear expectations—and help you get what you want!
Rules – Price Traditional • Seller motivation and emotion play a big part
REO • Priced to sell by institutions with no emotional stake Short Sale • Priced by listing agent and owner; bank must agree to this price
Rules – Speed Traditional • Normally proceed with all due haste
REO • Offers get quick reply • Last-minute closing delays common Short Sale • Slow offer response • Acceptance brings fast close
Rules – Decision-Making Traditional • Homeowner/seller decides
REO • Bank or lender decides Short Sale • Seller decides what offer to accept; lender must approve
Rules – Communication Traditional
REO and Short Sale
• Good communication expected but not always practiced
• Banks, listing agents pressured by volume— hard to reach • Buyers must insist on— and provide—great communication
Rules – Negotiation Traditional
REO and Short Sale
• Negotiation common on price, condition, and terms
• Some negotiation possible with Fannie Mae REOs • Short sale negotiation rare—properties sold “as is”
Seize the Opportunity Six Realities Define Your Opportunity 1. 2. 3. 4. 5. 6.
Buyer’s market—capture value now! Mortgage rates are great, but for how long? Affordability—home buyer dollars going further Number of foreclosures remains high Foreclosure inventory nearing peak All parties motivated to sell
Percentage of buyers who bought distressed property tripled from 2008 to 2009.
Six Realities 1.
Buyer’s Market—Capture Value Now
Balanced Market Inventory (6 months)
Six Realities 2. Mortgage Rates Are Great, But for How Long?
Current Rate: 5.00% 75% of distressed property buyers say low rates are their prime motivator.*
Sources: Mortgage Bankers Assn./KW DP Buying Survey*
Six Realities 3. Affordability Strong—Home Buyer Dollars Going Further Now Cost of home ownership headed down. Median-priced home monthly cost is about 15% of median income; this is down from 23% three years ago. How long will this last?
“Kiss 4% Mortgage Rates Goodbye,” CNNMoney.com (Dec. 30, 2010) Fortune Magazine and Money Magazine said in 2010 that BANK REO’s may present the “best” buying opportunity.
Six Realities 3. Affordability Strong—Home Buyer Dollars Going Further Now Cost of home ownership headed down. Median-priced home monthly cost is about 15% of median income; this is down from 23% three years ago. How long will this last?
Opportunity: 203k Loan FHA-backed Home Purchase and Renovation Program – – – – – –
Purchase price and documented repair/rehab costs bundled in one loan One set of closing costs 3.5% down; can be gifted Eased qualification standards Loan limit range $271k-$730k Possible energy-efficiency add on
Six Realities 4. Number of Foreclosures Remains High
Source: KW Distressed Property Buying Survey
Florida: Foreclosure Percentage
Source:2010 RealtyTrac
Tampa Bay Market: 2010 Traditional vs. Distressed Sold
Tampa Bay Market: 2010 Traditional vs. Bank Owned Sold
Six Realities 5. There’s Still Time— But Mortgage Rate Re-Set Peak is Near Mortgages resetting to higher rates are a big driver of foreclosures. Mortgage reset volume will top out in late 2010. Source: Credit Suisse Bank
Six Realities 6. All Parties Motivated to Sell –
Distressed homeowners—protect credit and escape payments – Lenders—get foreclosed property off their books – Agents—investing time and money in inventory; their clients need it sold + Your motivation to get a great deal means a win-win for all.
What’s Stopping You? What have you heard that concerns you about buying?
Ignore the Myths 1. Myth: Foreclosures are mostly low-end, in poor condition, and in bad areas. 2. Myth: Foreclosures have lots of title problems including liens.
Ignore the Myths 3. Myth: The best foreclosures get sold in bidding wars. 4. Myth: Loans are hard to get for foreclosures.
Ignore the Myths 5. Myth: Foreclosures take a long time to close and aren’t worth the wait. 6. Myth: The best opportunities have already been snapped up.
Buyer Success Bank REO Listed $175,000 $56,000 SOLD $54,000 Cash Remodeled Bank REO Listed $299,000 $255,000, $210,000 Sold $144,000 Brand New ! Motivated Seller Listed $599,000 $420,000, $320,000 Sold $310,000 New Remodel !
Corp Owned Listed $589,000 $339,000, $233,000 SOLD $229,000 Brand New Estate Sale Listed $535,000 $399,000, $300,000 SOLD $232,000 6BR 3BA by Beach Motivated Seller Listed $579,000 Sold $372,000 Bayou Country Club
Be Ready to Go 1. Motivation + 2. Preapproval + 3. Expert Advice
=
Success
Be Ready to Go 1. Strong Motivation Know your “Big Why� Have criteria set and be prepared to make decisions. Be ready to communicate clearly at all times.
Be Ready to Go 2. Preapproved Wallet Whether all cash or financed, solid buyers are the winners in this market.
Be Ready to Go 3. Expert Distressed Property Agent on Your Team In this market, more than ever, you need great representation! Quality advice counts.
Build a Strong Team A strong team that communicates well will get a winning result. Combine your wants and needs with local expert knowledge and experience. Here’s how we’ll work together …
Let’s Get Started— Now Is the Time What Questions Can I Answer? www.KeithConnors.com