Wednesday, March 18th, 2009 at 3:02 PM
Strategy for REO Offers
Back in the day, we used to love trying to steal the signs of the other baseball team’s third base coach. Other sportsmen have taken it too far, but I think if the other team is willing to tip you off, then you might as well see what you can learn.
As we know, the banks are overwhelmed – most of the asset managers have hundreds of active files, far too many to handle effectively. As a result, their pricing is less than effective, and scattershot all over the map – some way too high.
It is futile to lowball an REO early in the listing – it’s too easy for them to blow you off, and work on the files whose offers are closer to the list price.
But it seems like they have all adopted their own price-reduction strategy. Because the MLS has conveniently included the listing-history button, your agent can chart the progressions of price reductions. Usually it’s about a 5% drop every 3-4 weeks.
Once you think they are getting close to the right price, anticipate the next price reduction, and make your offer a day or two prior – hopefully you’ll be in the right place, at the right time!
Posted on Wednesday, March 18th, 2009 at 3:02 PM in Thinking of Buying? | 1 Comment » | 
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“Usually it’s about a 5% drop every 3-4 weeks” If only the sellers in the high end would follow this strategy, we could see plenty of sales all across the price spectrum, instead of lots of sales in the low end, and almost no sales in the high end.
Spotty | March 18th, 2009 at 3:18 pm