Distressed property sales…. Buyers be ready.

If you are just entering the San Diego real estate market as a buyer…  you’re probably wondering (or might be in the dark) about what we’re actually seeing in our localized market.  I can tell you… distressed sales!  Hold on.  By distressed sales I don’t automatically mean the obvious run down, abandoned foreclosed properties some people believe are dominating the market (oh those are there too).  What I mean is distressed (or stressed) sellers with very little cash to go around who are praying to get their short sales approved through 1st, 2nd and sometime 3rd lien holders (yikes). 

The San Diego market, and greater California market for that matter, has so many short sales that they created a new status option in the San Diego multiple listing service (MLS). And why do I lump short sales in as a distressed property sale?  Because these are very much an “as is” sale.  The seller has experienced a financial hardship (or is claiming such) and is asking for the lender to cover ALL costs of the sale through the gross proceeds of the sale.  And banks are not budging on buyer requests for additional funds needed for repairs that are uncovered during the inspection process.  So guess what buyers….  you have limited options and typically they will end with you footing the bill. 

HOWEVER….  property pricing in San Diego County is down drastically from 3-4 years ago.  I’ve seen some properties selling for HALF what they were at the peak in late 2005. Half!!  So as long as the needed repairs aren’t earth shattering, make sure you’re getting a good price based on today’s values, and go for it.  We even got a roof replaced for one of our buyers while it was in escrow!  She had to roll the cost of $6000 into the purchase price BUT she’s getting a home for $210,000! Wow.  Not possible even 2 years ago.

It’s not a buyer’s market.  It’s not a seller’s market.  Let’s be clear, it’s a really tough market.  But the opportunity is there.  Seek it out and take advantage.

- Tara

Contact Tara at 619-384-6014 or mySanDiegoAgent@gmail.com.