Thursday, May 19, 2011

Where are the foreclosures?

This Lincoln Square home may be distressed and even already foreclosed on...but you can't buy it if it ain't for sale.

One of our buyer clients earlier this season asked, "Where are all the foreclosures?". To paraphrase, he stated a website he was looking at said there are "42 foreclosures" around his target area for buying a house. "Why are we not seeing those" he asked. Of course, there were no addresses or information about those properties and he'd have to pay to get behind the firewall to view content.

I had three responses:
-First, those nearby foreclosures may not be so nearby when you pay for the content and see what and where those properties are.
-Second, he already sees any and all foreclosed homes that have been brought to the market and are listed on the MLS. The only other type of foreclosure he may not be seeing on our MLS searches may be an auction sale, but those are usually listed on the MLS too and almost do not exist in our target areas of Chicago otherwise.
-And finally, there have been VERY few actual foreclosed homes that have been listed and sold in the past year for our target areas... and that so far there are very few even available now. None that fit the budget and criteria we're looking at.

What most average retail buyers do not understand about foreclosures is you can only buy a foreclosed property if the bank/lender lists it for sale. Period. Many take a year to come to market after a foreclosure is complete. And if it does get listed for sale, you will see it in the property search I have set up.

What happened to this buyer client? A foreclosed property DID hit the market and was sent to them on their property search. It fit the criteria and my clients offered sight-unseen the property the first couple days it was on the market...and won it in a multiple offer! We still laugh about that conversation we had. This was the exception, but they were ready for it after they were educated on the local single family home market.

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