Lehigh Valley Short Sales – What is the current Market Value?
So, Short Sales are sold at current market value in as is condition OR maybe a hair less…like $5000.00 under. If you get a better deal from today forward – Please let me know because you gotta understand that the seller’s lender is already loosing money because the seller owes more than the property is worth. The purpose of a short sale is for the property to be sold at current market value in as is condition.
So, How is current market value established? This is HOW It should be estiblished.
1) A Real Estate agent should do research in the local MLS to find out what other properties sold for over the past 3 to 6 months that are similar to the subject property.
2) VERY IMPORTANT: The properties that have sold that are simular must be simular in the following ways. you can not just pick from all of the properties that sold over the past 3 to 6 months – they must be simular to the subject property (the subject property is the property you want to make an offer on)
- They must be within 300 sq feet smaller or larger then the subject property
- They should not be Bank owned or short sale properties if it can be avoided.
- The should by the same or simular sytle of the subject property – Like if the subject is Ranch – The sold property should not be a Bi-Level it should be a ranch. If the subject is a Twin it is expectable to use Row or end of Row for a comparable.
- They should be within the same year of the property or max of 25 years if possible.
- They should have about the same lot size.
- They should be within .5 or 1 mile radius of the property if Urban (city) 2 to 4 miles if Suburban (just outside city) 5 miles is okay in Rural areas (country) and 10 miles is acceptable if a very unique property.
3) After 3 sold and settled properties are found then they must be compared to the subject property condition vs condition – if the sold properties are in better condition then you should subtract the repairs that are needed on the subject. An experienced Real Estate Agent who works with Short Sales and Foreclosures should be able to price out a property for you during the showing and tell you a ball park that it will costs to rehab the property – I can do this within about 15 mins of viewing a property. This information must be proven with written contractor estimates which the real estate agent should be able to get for you at no cost – again this is only for those who specialize in these types of properties.
4) All of this information above will establish current market value for you in as is condition – In a short sale situation it does not matter what the property is listed at because so many real estate agents do not know what they are doing in a short sale situation – You should have proven sold and settled comparables as I explained above and expect to pay current market value for the home – otherwise it is a complete waste of your time to wait around for 90 days to see if the seller’s lender is going to approve your offer – Short Sales are sold at current market value in as is condition and nothing less.
I hope this information was helpful to you.