Here they are for all you Craigslist users!
10 Homes in Sonoma County for under $250,000
For some very strange reason, craigslist.org won’t allow me to post links to the properties in the cragslist ad itself. So, my apologies, you have to visit my blog first to see the properties! Of course, if you’d like to see any of these, feel free to give us a call.
707 771-0550
If any of you read the Petaluma Argus Courier on a regular basis, perhaps you came across my last article published on February 26th:
http://www.petaluma360.com/article/20090225/COMMUNITY/902250928
Feel free to read the full text if you like, but it was basically a piece about foreclosures and why sometimes the highest bidders don’t win in multiple offer situations. At the close of the article I pointed out that contrary to what you may hear from various websites and talk-radio advertisements, you won’t be ‘flipping’ foreclosure properties for huge profits like it’s 2005. Apparently one person was listening…
Sean O’Toole of Foreclosureradar.com and Foreclosretruth.com took ’serious issue’ with my comment, and posted the following reply on Petaluma360.com: (see full post here)
Armand – I have to say that I take serious issue with your saying that ForeclosureRadar has ever claimed anyone can buy a foreclosure for pennies on the dollar. If you had ever visited our website, my Blog, our forums at ForeclosureTruth.com, read my posts at Inman.com, seen me on the news or heard me speak you’d know that not only does ForeclosureRadar not make those claims, we actively work to set the record straight.
I’ve personally purchased more than 150 foreclosures, but even with all my experience I have rarely bought a home for 50 cents on the dollar as other foreclosure services claim anyone can do.
Clearly you are frustrated with the REO process. We are working hard to provide greater transparency to the process and make it easier for Realtors(R) and the other professionals we serve to do business in this market. Unfortunately we can’t control the lenders actions, but we are doing our best to help.
Having recently purchased an REO, I will say that the terms of the offer are VERY important as you suggest. But that has always been the case. When the market was hot, sellers would often pick the best offer not only on price, but on contingencies, the quality of loan approval, and other offer terms – that is just good business sense.
My suggestion to buyers who are having trouble getting their offer accepted – find an agent with experience representing buyers in REO purchases, they’ll know how to submit a good offer.
Best Regards,
Sean O’Toole
ForeclosureRadar.com
ForeclosureTruth.com
Well Sean, thanks for your input. Furthermore, I’m glad to hear that we seem to agree on a couple points.
First, that even as founder of one of the most thorough databases of mortgage default data, even you agree that the best way to purchase an REO is to find an experienced Real Estate agent! (foreclosureradar.com is a database of notice of defaults (‘pre-foreclosures’), notice of trustee sales (‘home auctions’), foreclosures and market stats) If there’s any homebuyer who could manage on his own, it’d probably be you, and even you recommend using an agent.
Second, that as you’ve found in your experience, rarely will you ever find a home for 50 cents on the dollar by scouring notice of default lists. In Sonoma County at least, I’ll add, rarely will you find a home on the auction block that has any equity at all. Local Realtors in this area are so on the ball, should anyone who’s late on their payments actually owe less than their home’s worth they’ll certainly be contacted and have the opportunity to sell their home before losing it to foreclosure.
As far as your website is concerned and the claims that it makes, yes, I do owe you a ‘retraction’ – to my knowledge, you or your site never made the statement that you can purchase homes for ‘pennies on the dollar.’
However, being a member of your site for the past few months, I suppose I’m entitled to my own customer review.
As a ‘visitor’ to the site, you won’t see much, mainly just some text about the site’s benefits, features, etc. Buy an account, however, and you’ll see that trademark mapquest screen with the blue, green, and red dots as seen on CNN that’s liable to send chills down your spine at first glance! Those dots, buy the way, represent properties in the three stages of default – ‘preforeclosure’, auction, and bank-owned. Don’t worry though, many of those green dots (preforeclosure) are short sales that are already on the market, some of which have accepted offers and may actually sell and avoid foreclosure altogether. The blue dots represent properties in auction status, where there’s a set date for them to be auctioned off at City Hall, and the red dots represent ‘bank-owned’ properties (properties that were taken back by the bank in a foreclosure process) that are probably already on the market. (and depending on your market, probably already sold!)
Even as an agent with access to the MLS (the most complete database and archive of listings – the one that feeds Realtor.com and the rest) I’ll say that I find the site impressive. I’ve been searching ‘preforeclosure’ properties (also known as ‘notice of default’) for the past 18 months or so through my title company but seeing them on a map is much more slick and informative. There are some financial calculators for determining potential equity of a property or return on investment, a favorite listings manager, and even an IDX solution for agents. Perhaps the most powerful tool the site offers are the market statistic reports which have made their way into the LAtimes and other large media sources: http://latimesblogs.latimes.com/laland/2008/08/estimate-1300-f.html
However, with all the bells and whistles, we still have the question of value … is it worth it to the average homebuyer? At $50 a month – yes and no.
Yes in what I call the ‘neighborhood watch’, that is, you can literally track the amount of pending foreclosures (and possible distressed properties) in any neighborhood that you’re considering. Find a neighborhood or home that your like and then zoom in to see how many foreclosures will be popping up in the next few months. In most cases, the more foreclosures there are, the more property values will drop. And yes in pure entertainment value, log-in and appear savvy to your friends or colleagues!
No in the simple fact stated earlier by the site’s founder himself. The best way to buy an REO property is to find an experienced Real Estate agent, period. As far as bidding at auction is concerned (buying a true foreclosure and not a bank-owned property) in the lower price ranges I’d recommend against it 90% of the time. Buying a home at auction is a complete as-is sale with no inspections or rights of rescission (most of the properties in the lower end in Sonoma County are moderate fixers or worse), many buyers don’t even have the financial resources to begin with, and furthermore, in case you haven’t noticed, there are plenty of REO properties available on the open market! Many REO properties have also been rehabbed to qualify for FHA financing, making them an option for the low downpayment buyer, and tenant-ready for the investor.
If you’re looking in the high-end market then inspections may not be as critical an issue. However, the chances of someone willing to let his $600-$700K home slip away to foreclosure when he could have pulled out an additional $50,000 in equity isn’t too likely, he’d just sell the home first. In other words, I doubt you’d find a high-end home even worth the opening bid amount in the Bay Area…you will find million dollar REO properties, however.
So in the end, Mr. O’Toole, I’d say that your site does live up to it’s claim – it is the “professional’s choice for complete up-to-date information on every foreclosure in California”. Super savvy investors, like yourself, who have bought many foreclosures before without a Real Estate agent will also benefit by using the financial analysis tools and just saving a heck of a lot of time in driving to the courthouse or title company every week to get the lastest NOD list. As far as the average homebuyer is concerned, you probably won’t be buying a property at auction anyway, so find an experienced agent and tell her what you’re looking for. She’ll get you to your ultimate goal of actually writing an offer and buying a home, not just looking at well-designed websites.
Thanks for the comment Sean,
-Armand Ramirez
It’s not you, it’s them!
Still getting “dumped” by REO properties? What you can do to win in your next multiple offer situation.
Taken from the Petaluma Argus Courier, written by Armand Ramirez
If you’ve ever heard the words “it’s not you, it’s me”, it probably wasn’t a particularly fond memory. Both Men’s Health and Cosmo would probably agree that it’s the most cliché way to soften the blow of a failed relationship, but putting that subject aside, it’s actually a good analogy for why your offer on that REO didn’t get it accepted. You were probably well qualified, highly motivated, and maybe even willing to pay the most money – the reason why someone else got the property probably had more to do with a rather strange lender requirement than you being the best buyer. So, here are a few steps you can take to make sure that you don’t get dumped in an REO multiple offer situation again.
127 Alden, Rohnert Park. $219,900 – over 20 offers received!
Cash is king, not purchase price.
If you were selling a house, would you wait an extra ten days for an extra $10,000 dollars? Sure you would, that’s an extra $125.00 per working hour! But then again, you aren’t Fannie Mae, and you don’t own an estimated $100 billion or more in risky loans. That being said, an all-cash offer with a 20 day escrow at $250,000 is much more attractive to a large bank than an offer at $260,000 with 10% down and a standard 30 day escrow. With competing buyers (in multiple offer situations) banks want the surest deal, not necessarily the most money. In fact, banks don’t even don’t even calculate their P&L in the same manner as you might – they write off their losses in advance, estimating the loss in equity on a property before putting it on the market. Sound odd? Write-off enough losses and shed enough toxic assets (i.e. defaulted mortgages) and you become a superb candidate for bailout funds…or so the rumors in the ‘blogosphere’ go! Lesson to be learned, streamline your financing and make it a quick deal for the bank. If it’s your first home, ask for a family down payment loan or lower your purchase price to make your down payment as large as possible. If it’s an investment, pull out equity on your primary residence to forego secondary financing or mortgage insurance – two words that send chills down any bank’s spine. If you simply don’t have a large downpayment, get all of your loan paperwork in order an write as short a loan approval contingency as possible, cut it to 12 or 10 days from the standard 17 – just make sure that your lender can perform. Remember, the sellers of REO properties are the sellers of mortgages; they know how volatile the loan approval process is. Make your loan as attractive as possible and your offering price will look more attractive in return.
22 Payran, Petaluma. $162,000 - all REO properties are somewhat of a gamble
“As-is”
REO properties are a roll of the dice, period. Many of the homes have had disgruntled owners or tenants (as you can imagine), little or no information on the permit status of improvements or repairs, and some have sat vacant for months. Like any property, a lot can come up on inspections – banks know this well, and make every property an “as-is” sale. “As-is” sales still come with inspection rights and rights of rescission, but if anything scares off a bank, it’s a buyer who demands their standard 17 day inspection period. This issue goes to the heart of the ten day question, if you write a 10 day inspection period and another buyer asks for 15, all other things being equal, you will get the property. Lesson to be learned, line up your inspectors ahead of time before your offer is submitted and ask for a shorter inspection contingency. You can always cancel an inspection if your offer doesn’t get accepted, but scrambling for inspectors at the last minute or demanding too long an inspection period could cost you the deal.
REO stands for “Real Estate Owned” not “REaltor Optional!”
Question: “Can I just make an offer directly to the bank before it his the market?” Answer: “no.” 1) No bank will ever look at an offer before it is assigned to a listing agent and has decided a price. 2) No bank will ever look at an offer from a buyer without an agent (buyer acting as principal). That’s just how it’s done. Put yourself in the shoes of a Chase Manhattan. You own a few thousand properties that you’d like to sell, only problem being that you have no idea what they’re actually worth. They’re being sold in 50 different states, from $5,000 or less in Detroit to over $1 Million in our backyard in Sonoma County. Sure, that all-cash offer for $300,000 a property in East Petaluma sounds great, but what if the home’s actually worth $350,000, or $400,000? Only thing to do is to make a standard of practice in selling all of these thousands of homes, a practice that begins with a Realtor and ends with one – at least that’s what the vast majority of banks have decided. In every bank that I have dealt with in the past two years: a) the property must be listed on the MLS before taking offers, b) all buyers must submit an offer through a Real Estate Agent. Regardless of what the latest talk-radio advertisement or realtygimmick.com website may claim, you will not steal properties for pennies on the dollar and flip them to your early retirement (this isn’t 2005), however, you will see prices that in some areas haven’t been as low since the late ‘90s.
So if you’ve missed out on an REO property in the past, don’t worry because it really wasn’t your fault, it was probably theirs! Now that you know a little more about what qualities banks are wanting in a buyer, get your ducks in a row and get back in the game. Getting preapproved, lining up inspections, determining how much to offer…looking for a place to get started? Of course, look no further than your local Realtor.
Still think that you’re priced out of the market? Here are 4 homes (detached residences, not condos or townhomes) for under $150,000. In terms of monthly payment, that’s less than you’d pay for rent with even close to 100% financing. In terms of an investment, that’s instant cash-flow with just a modest amount down. Without further ado, here are four of the Wine Country’s most affordable digs.
Home #1
2543 Shawnee Street, Santa Rosa – $140,900
3 Beds, 2 bathrooms
1100 Sqft, 6011 Sqft Lot
Listed by Keller Williams Realty
Pro:
Decent square footage & lot, 2-car garage and “retro” rock siding right out of the Flintstones.
Con:
The listing reads “Completely Damaged by fire”, so yes, it’s a fixer.
The Dirt:
It’s been on the market for almost a year now as a foreclosure; with a decent agent at your side, there’s probably some wiggle room on price.
Home #2
823 Link Lane, Santa Rosa – $145,000
4 beds, 1 bath
1103 Sqft, 6534 SqFt Lot
Listed by Creative Property Services
Pro:
Definitely the lightest fixer of the bunch with a decent looking kitchen remodel (80% complete) to boot. 4 bedroom would generate good rent, backs to elementary school – exercise the dog with ease!
Con:
Missing that second bathroom! Roof looks to be shot (what would you expect), busier street than others in the West 8th neighborhood, T-111 siding.
The Dirt:
A great deal for the price. With minimal repairs, this would be a great rental or even residence. Homes on this street sold in the mid $500,000s…that’s not a typo either!
Home #3
710 West 8th Street, Santa Rosa - $149,900
3 beds, 2 bath
1105 Sqft, 6011 SqFt Lot
Listed by Keller Williams Realty
Pro:
Cute, up & coming neighborhood with less traffic than Link Lane. Cool 1950’s Rancher architecture with wonderful redwood siding.
Con:
Definitely a fixer, creepy lino floors (easy fix) – not many complaints
The Dirt:
I’ve recently sold 2 homes in this neighborhood (for $40K more) and my buyers have found tenants with relative ease.
Home #4
1221 Grand Avenue, Santa Rosa - $99,900
2 beds, 1 bath
581 Sqft, 4400 SqFt Lot
Listed by Coldwell Banker
Pro:
A home for under $100,000. (period)
Con:
A fixer of a home – no bank would lend money one it.
The Dirt:
Hey, it’s a home for under $100,000. I haven’t seen this one in person yet, but just reading comments from previous listing agents in 2005 and 2003, the home looks to be roughly 1600 SqFt including a garage-conversion studio. If you’ve got the cash, this would be a great cash buy, fix up, then refinance. With about $50,000 down, you’d have some decent retirement income.
So there you have it…four homes for about the same as a Porsche Sport-Utility. Even in this market, I can guarantee that the car would lose more equity! Feel free to call if you’d like to know what else is available in Sonoma or Marin.
REO of the Week, 672 Casella Way, Petaluma 94954
2006 prices … at a 40% discount!
The Dirt -
Address: 627 Casella Way
Bedrooms: 3
Bathrooms: 2.5
Interior SqFt: 1538
Garage: 2-Car
Year Built: 2006
Asking Price: $350,000
672 Casella Way … the “like new” “cosmetic fixer”!
This townhome (attached on one side) is part of the Chelsea Square complex completed in 2006 by Delco Builders. I can still remember the lines the morning of the auction…buyer’s names were literally drawn out of a hat to place offers on the units. There weren’t any overbids, oddly enough, but they were going like hot-cakes … $550,000+ hot-cakes to be specific. Conveniently enough for the builder, just after selling the last units at prices nearing $600,000, the first wave of NODs (notice of defaults) began to show up on the the public notice section of the Press Democrat.
Walnut cabinets with white-tile countertops … sorry, no appliances.
“Short Sale, what is this, the stock market?” Few had even heard the term before, and even fewer knew what it meant for our market. Yet like a fringe, doomsday prediction come true, the prices started to fall…and fall, and fall! First the overbids stopped, then prices stayed stagnant, and then, WHAM, it hit us … the market is falling through the floor! Just two short years later a home that sold in the construction phase for close to $600,000 now sits 50 days on the market with no offers at $350,000 – roughly a 40% drop in value, that’s $9,375 in lost equity PER MONTH!
636 Casella – a virtually identical, beautified unit in the same complex @ $485,000 in 2007.
“Are we at the bottom”? If I’ve learned anything, it’s to hold my tongue when asked to make Real Estate predictions. What I do know, however, is that with today’s 30-year fixed rates approaching 4.5% at only 1 point, with a modest sum of cash to put down on this unit you’d possibly be paying less by purchasing than renting!
These units have HUGE master suites with 2 closets & dual vanity sinks in the bathroom. (636 Casella)
However, if you’d like a different sort of prediction, try this … if you don’t see this property within the next week or so, it will probably be gone!
Cows as seen along the walking paths by Chelsea Square.
Give me ring if this property looks interesting to you. If 2006’s prices were a bit steep, take 40% and see how you feel – we’ll make that your starting budget and go from there!
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Jennifer Aument Realtor-Associate |
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Armand Ramirez, Realtor-Associate Century 21 Bundesen
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