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Phoenix Real Estate and Homes for Sale | Jonathan Dalton, Realty ONE Group – (602) 502-9693

Jonathan Dalton
REALTOR
ePro, SFR
602-502-9693

Negotiating to Buy a Phoenix Bank Owned Home

Negotiating to Buy a Phoenix Bank Owned Home

avatarthumbnail.jpgHere was a unique situation … my buyers found a bank owned home that they really liked and made an offer. The house had been on the market for five days but they were fortunate – there were only two other competing offers.

(Wait … you didn’t know that multiple offers are standard for REOs in the Phoenix real estate market these days?)

Back came the bank with the nebulous, ominous counter … give us your final and best offer. At my advice, they held their ground at list price with a small seller contribution to the buyers’ closing costs. And they got the house.

Here’s the key element – the buyers didn’t bid against themselves. They decided before writing the original offer what their best offer would be. If it wasn’t enough then this wasn’t going to be the right house for them.

Holding one’s ground isn’t easy especially after you’ve decided this is the one house for you. But that’s often the best strategy. It’s just a matter of having either a buyer or (more importantly) an agent who has seen multiple offers in the past and knows not to panic – especially when that multiple counter doesn’t have a firm number written in already.

On a somewhat related note, the very wise BawldGuy has taken a long look at the Phoenix real estate market and come to a conclusion eerily similar to mine in its brilliance:

It’s a seller’s market for REO’s only. The rest of the market is still firmly ensconced in the buyer’s market column. FIRMLY. But as soon as the REO’s are gone — guess what? The next cheapest homes are gonna be the ones who’ve been stomped on and falling down the same stairs for nearly three years now. Suddenly, they’ll be the prettiest girls at the dance. They’ll begin to sell in ever increasing numbers.

Since everything’s still ongoing I can’t discuss details but I’ve seen this in action – with the bank owned homes out of the way, the next best priced homes become the centers of attention. It’s not mere speculation.

We may not be at the bottom but the pit doesn’t look nearly as bottomless these days.

[tags]Phoenix real estate, bank owned homes[/tags]

No Comments

  • Very saavy and I completely agree with the multiple offers on REO properties. As soon as we are through those the next set of houses will be ready.

  • Tiffany Cloud says:

    I couldn’t agree with you more and I have been sharing my thoughts on the inevitable shift in market with my clients.

    It amazes me (well, maybe not so much) that the media is mute on the fact that REO’s are in such a competitive market right now. I have buyers that have been out-bid on the last three REO’s they have offered on. We are waiting to hear on the fourth, but there are 4 other offers on that property and another weekend for the bank to collect offers. Why aren’t you hearing about this on the 10’oclock news?

    The housing market is an amazing growing dynamic… If someone told me that we would be competing like this for bank-owned properties with no warranties, repairs or disclosures 6 months ago…I wouldn’t have believed it! While it was inevitable that we would have to work through excess REO inventory to return to a somewhat ‘normal’ market, the surprise for me has been the speed at which we are working though the inventory. That speed is what is creating these competive bidding situation – folks feel the urgency to get these homes while they can.

    Legitimate home sellers that have been able to make your mortgage payments as promised…hang in there, your day is coming and maybe sooner than you think!

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