I live in Florida where the housing market crashed and burned. Several months ago I inquired about a home and was told it was $158,900 in a neighborhood that by all accounts seems to be about the same price. Several weeks later I got a call from the agent saying the price had been lowered to $134,900 and she asked if I was still interested. I told her I'd drive by and check it out. A few weeks later she emailed me and asked if I drove by and I replied that I didn't. She emailed me back and stated she could come down on the price, which I didn't think much of. Yesterday, after several weeks of not talking to her, she called me and asked me if I ever looked at it again. I told her I wasn't interested and she came out and admitted to me that the owner owed $120,000 on the mortgage but would accept any offer. To be honest, I was trying to get rid of her and I said, "I wouldn't offer you more then $100,000." She replied, "If you are serious I will put together an offer." At this point I was kind of shocked so I told her I'd drive by and check it out one more time.

I guess I have several questions, as someone who has never purchased a home. They are coming down almost $60,000 from what they were originally asking and I have to wonder if that is desperation or if they know something I don't know. Mind you, she keeps contacting me, I'm not trying to contact her. Second, assuming the market picks up in the next year is possible this home could jump back up to $158,900 or is that just a price they threw out there originally. I guess what I'm really asking is, how can I find out the real value of a home? I'd love to go in and steal this place and when and if the market goes back up turn around and sell it but I don't know how to determine the real value.

Any input would be appreciated.

Fr_Chuck

It is very possible that they owe 120,000 but can't pay the mortage, and want to sell it before the bank takes it.

** now they may have also found it is located on an ancient indian burial ground too ???

But if they owe 120,000 on it, and you make a offer for 100,000 this is called a short sale, in these cases the mortage lender has to decide if they will lose 20,000 on the sale, alot will depend on how bad the market is there, and also how for behind the owner is.
I have had trouble getting short sales approved, but I understand some lenders do it fairly easy.

To see the real value, look up other homes in the same area that has sold in the last 6 months, also look at other homes in the same area that are for sale, what is thier asking price.

jillianleab

Chuck is right, this sounds like a short sale. He's also right that you should look up similar homes in the area to see what they've been selling for. I like this site: Real Estate Valuations, Homes for Sale, Free Real Estate Information | Zillow Real Estate. Also, the agent who keeps calling you should provide you with neighborhood comps, if you request them.

It is very possible this is a steal for you. I don't know too much about the Florida housing market, so I can't say for sure if the house will go up or down in value, but certainly it's possible that it will go back up. If you are afraid the home isn't worth the asking price, or that there's something horribly wrong with it, make sure you have an appraisal (most loans require this anyway; if it won't appraise for the asking price, you don't get the loan),a home inspection and pest inspection. The home inspection will let you know if there are any major things wrong with the house, and the pest inspection will tell you if there are termites, termite damage, rats, mice, etc.

Good luck to you!

Fr_Chuck

yes, I got rid of most of my properties right before the biggest part of the fall in my area, on my main home I was finally able to sell it and make a 1000 or so but I had to reduce it about 40 percent of its appraised value to finally sell it. So someone walked in to a home at a price less than I had paid at a bankruptcy sell 5 years earlier. Now they did also get the red neck neighbors and the busy body neighbor free of charge. But I was afriad I would have to sell it for less than I owed on it to ever get it sold.

So deals like this do happen in this market, If you are going to live there for years, you will be ok, will the market keep going down over the next few years, most likely, but not all neighborhoods, but the values will be going back up in a few years, so now is a great time for long term buying

chuff

Thanks for the information.

From what she told me, this is not a short sale yet, but apparently could be soon as the guy who owns it is desperate. In fact those are her words, she said he was "desperate" which is why I was kind of surprised, I didn't think she would want to admit that. The problem I have been facing is not the mortgage payment, but the ridicules taxes and insurance rates down here which basically double the monthly payments. In fact that's why the housing market has crashed here along with the high rises going up everywhere.

I'm going to talk to her tomorrow and get a comp sheet. I was just talking to this guy I work with and he said, I might try and offer $80,000 and see if they take it. Is that going to low? Basically taking half off?

Scleros

Many localities have their tax information in a Geographic Information System (GIS) that you can Google for and lookup the appraised value as well as owner and other info. Or, you can simply ask the department that manages personal property taxes. I consider the tax appraised value = public auction value = "real" value. If you purchase for less than or near the appraised value, it's unlikely you would ever lose money reselling the property.

What's the address? I'll look up the info...

chuff

720 45th Ave St Petersburg FL 33713

Don't be stealing my potential first home.

Fr_Chuck

well the problem with this is that if the loan on the home is 120,000, it will be a short sale, and I don't think any loan company wil take a 40,000 loss, they would be better off foreclosing and selling the property thierself
(*normally) But then all they can do is say no, on most of the properties I have bought, I have two or three where they laugh at my offer.

Scleros

Who me?

Visit City of St. Petersburg GIS. House 720 45th Ave. N. has value of $126,300. Google maps even has a street view with realtor sign in yard! Most houses near that corner on same side of street are in the $40-80,000 range. I can't see back of house, is it much larger than neighbors? Might be able to get it less.

jillianleab

I've found that in my area, the web searches are unreliable for comps; the data doesn't get put in right, or it doesn't get updated.... Also things get really skewed because right now there are so many foreclosures. On my street, for example, one house is going for $200K; another is going for $350K. I'd take the advice of an agent, who can look at the sold details of the property, and inform you better. Web stuff is good for an idea, but what you really need are the Realtor resources.

Also, are you working with this agent? Did you sign a buyer's agreement with her? She might be pressing you because if she gets the sale and the purchase she makes more commission... that means she might not be working with your best interests in mind.