How is it that banks can still be making idiotic decisions this far into the real estate bust? Why do they seem unable to grasp the basics of their own business?
For example, I am involved in a short sale with Wells Fargo at the moment and this particular deal involves a decent property in a so-so neighborhood that was listed for $165,000. The mortgagor in this deal has not paid any mortgage payments for 10 months and has filed his hardship paper work with the bank. One week after the property was listed a solid offer was tendered on the property at $160,000. We sent the offer in and then we waited, and waited, and waited… Nothing.
I come to find out that the loss mitigation department at Wells Fargo had performed an appraisal on the property and had valued the property at $295,000, an insane amount and almost double the price for which it was listed. This over-valuation being so absolutely ridiculous I called the negotiator to get an explanation.
After an hour on the phone with no less than 3 of the underlings that answer the phones and read the scripts for big banks such as Wells Fargo I finally force one of them to put a supervisor on the phone. The supervisor gets on the phone and seems to be appologetic and informed. Now I’m thinking ‘hey, I’m finally going to get some straight answers’. Nope, not even close. The supervisor proceeds to inform me that not only am I not allowed to speak to the negotiator but I am also not allowed to see their ludacris appraisal. And, oh yeah, because of the outrageous appraisal value on this property your realistic offer has been denied and thrown in the trash. Now keep in mind that this was at least 4 weeks after they had made the decision to deny the offer and no one there, including the negotiator, even had the common decency to call and let us know they had made a decision. Amazing.
So, if any of you out there have to deal with Wells Fargo in a short sale situation take this story to heart and be prepared for the ridiculous, the outrageous and the inept.
Considering what has happened to real estate prices throughout our country I think it is fair to say that America is on sale. Home values have plunged as much as 50% here in Bradenton, Florida and there could not be a better time to invest in real estate, either for a primary residence, vacation home or rental property. There is some concern over where the bottom is and many folks may be a bit afraid to come in off the sidelines for fear that values will continue to slide. That is a valid concern and one that cannot be ignored.
However, I suggest that if you find a property in good condition, in a good neighborhood, on sale for less than $100/sq. ft. then you have found a good deal, no matter what the market may or may not do. The going rate, approximately, for construction of a new home - or what we refer to as replacement cost - is currently $125/sq. ft. So if you can find a home that can be purchased for less then the cost of building that same home then you have found a deal. Moreover, I am seeing certain properties in my market that are selling for less than $80/sq. ft., and they are not tear-downs.
When everybody is selling you should be buying, when everybody is buying you should be selling. Right now everybody is selling and it is a fantastic time to buy a home. The American economy will rebound, like it has before, and when it does those who made smart decisions will be reaping the benefits.
If you are not holding open houses you may be missing out on one of the most productive lead generation tools available to real estate agents. Although the opinions on the validity and productivity of open houses are widely debated in our industry it is my experience that for the time invested and the quality of client procured it is advisable to hold as many open houses as possible. Moreover, the continuation of drastic price reductions coupled with our record inventory can only mean that the amount of foot traffic for open houses this winter is going to be spectacular. I know I will be out there, every weekend, holding as many open houses as I can. Will you?
The SAR has lost an ethics violation against Marc Rassmussen, a real estate agent in Sarasota, but has succeeded in stealing Mr. Rassmussen’s domain name, www.TheSarasotaMLS.com. The geeks at the SAR claim that they own the rights to the letters MLS and that no one can use those three letters in that order in a domain name and the Internet Corporation for Assigned Names and Numbers (ICANN) agrees and has directed Mr. Rasmussen to transfer, without compensation, his domain name to the SAR! So now all the time and money Marc has spent building his business and his name is wasted and he is left with nothing and has to start all over again.
Hey, Marc! How’s it feel to be railroaded by a bunch of greedy Facist’s? Welcome to the New America, everybody, you’d better buckle up.
Barack Obama’s economic philosophies are bad news for the real estate industry and the country in general. If he actually does what he claims he is going to do - raise taxes on businesses that make over 250,000/year - in this economy it will spell disaster for this country. Anyone who knows anything about economics knows that in a sagging economy the worst possible thing you can do is to raise taxes. Higher taxes, especially on businesses, means that profits will decrease, prices will increase, wages will stagnate and people will lose their jobs. And if folks don’t have a job how can they afford to own a home? Moreover, according to the SBA (Small Business Administration) 250,000 dollars in annual receipts is a pittance. For example, to be considered a small business in the service industries you must have less than 32.5 Million dollars in annual receipts. 32.5 million! So Obama’s 250,000 dollar mark only serves to further expose his lack of understanding and socialist mentality.
I also believe that what we are currently witnessing in the stock market is a direct result of businesses being afraid of an Obama presidency and taking money out while there is still money to take. Business people know that if Obama is elected and he raises taxes that it will kill American business. America currently has one of the highest corporate tax rates on the planet and Obama and the Democrat party want to increase it. Why on earth would anyone increase taxes, especially when the economy is struggling?
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