I’ll have the full numbers tomorrow but after reading a question in Trulia Voices from a frustrated home buyer in Phoenix, I thought a brief preview is in order …
As of right now, there are 4,287 bank owned homes active in the Arizona Regional MLS serving the Phoenix real estate market. Over the past 30 days, there were 4,387 closed sales of bank owned homes in Maricopa County.
What you’re looking at is an insane absorption rate of .98 months – roughly 29 days. If no other bank owned homes came on the market (and 675 have been listed this month so far, a fairly pedestrian 60-odd a day), the entire bank owned inventory in the Phoenix real estate market would be sold in under a month at current sales price.
Which makes this question from Trulia unsurprising …
“I am looking at foreclosed homes and have put a bid in on one home and lost it. I have been trying to put a bid in on other homes that interrest [sic] me but it never comes to fruition due to the home going into a pending status before I can get my bid in. When is the best time to put in a bid? Would it help if I wrote a letter to the banks letting them know how much I need and want the home?”
First off, as cold as it sounds, the bank doesn’t care whether you want or need the home. They are completely impersonal in these matters and only are concerned with receiving the highest possible amount of money for the property. Second, given the current environment, list price likely will not be enough to get you a home in most cases. It’s basic economics – demand is outstripping the current supply.
In Surprise, where the above questioner is looking, there are nearly 500 non-bank owned homes and non-short sales for sale. The issue is only one of them is listed below $100,000. But here’s the thing … on a non-bank owned home, you can offer less. Either the seller accepts or they don’t. The leverage you hold as a buyer is the home has to appraise for at least the sales price for your loan to go through; below that mark and either you’d have to bring additional cash or you can cancel the contract. (Those are the contractual options … in reality, it’s not uncommon for the seller and buyer to find some middle ground.)
If you really want and need a home, then you need to look where the homes are. And the non-bank owned segment is where it’s at.
Full stats tomorrow, as always.
[tags]Phoenix real estate[/tags]