You’ll hear in this tour of Carlsbad REOs that banks are dropping the opening bids at the trustee sales to at, or below, market prices, and they are still going back to bene(ficiary). In the video I lay out the game plan for buying direct at the trustee sales, which I’m happy to do.
But the real test is: what will the eventual list prices be for these? If they list for the same as their opening bids, then forget buying at the trustee sale. I’ll take my chances battling off the multiple offers, in exchange for full rights of house inspection, title insurance, and the ability to finance. It might be worth another 5% or so for that convenience, plus the bank/seller pays the commission.
We’ll see – my guess is that the bank-sellers are going to use the appraisals, and list higher. This group will be our test case.
The other challenge is that most of these bank-sellers haven’t been determining the opening bid until the day of the trustee sale, which leaves you an hour or two to scramble down to the courthouse with your cashier’s checks. For those who are liquid for the entire amount of the purchase plus costs, and have flexible schedules, these are opportunities. For the rest, well I’m still hopeful we can pull financing together.
I prefer not to do these, they are risky and not for the faint of heart. But if it’s where you get the best deals, then it’s my job to facilitate you being able to take advantage.
BTW, at the end of the Mar Fiore rant the camera points at two houses, and I blurt out, “They sold for $1.2 & $1.3”. They sold for $875,000 in 2002 (corner lot), and $881,000 next door in 2003. It’s the third house in that is currently listed for $1,179,000. Other sales on that Cassins culdesac include $1.65 (10/05), $1.575 (7/07), and $1.275 (4/08).
Here is the youtube video tour of Carlsbad shadow REOs:
Excellent stuff as always Jim. Any chance you have input into potential shadow in Carlsbad Sub 500 or SEH areas? Cheers
I really enjoyed that. I am extremely interested in Trustee Sales but want to buy either a home in Carmel Valley to live in OR an investment property in 92083/4.
THANKS!
Does the toilet paper in the tree come with that first house? 🙂
The Wall Street Journal is sending some love today:
http://blogs.wsj.com/developments/2009/07/21/are-banks-holding-a-shadow-inventory-of-homes/
But on the topic of banks deliberately holding back dozens or hundreds of properties, there aren’t many on the tax rolls that aren’t listed for sale.
These vids over the last couple of days include nearly all of the bank-owned houses in Carlsbad, Encinitas, RSF, and Carmel Valley that aren’t on the market, and half of them were foreclosed in the last month. You can expect that there will always be delays due to evictions.
What I need to do is track what happens to the 3,715 NODs filed last month – do they loan mod? Short sale? or get foreclosed?
I got frustrated with the Trustee Sales. The problem that we were encountering is that there are a few guys/groups who are out there daily with $3-5 million in cashier’s checks in hand. They bid-up the really good deals higher than what our threshold might be. I have been out there dozen times unsucessfully. Keep in mind that many properties will go postponed or cancelled at the last minute. It is alot of work–If someone lived close to downtown, it might look more attractive.
Jim, excellent as always. HOWEVER, I believe prices are still headed lower (inflation/deflation adjusted).
It is easy to get excited about these “fire sales” but if you look at the real numbers behind this Depression (thats what we are in by at least 10 qualifying attributes) prices WILL head lower.
How big can the buyer pool be at 500K plus?
I just read my last post–I don’t mean to sound negative, or to discourage anyone from buying at the Trustee Sale, however please go in with realistic views-I had been overly optimistic and became frustrated.
Local Boy, “overly optimistic”? No way 😉
Much superior product for the tours 3 & 4. I’d be interested to see what happens with these same homes. Obviously sales prices will be well over opening bid price. Flipper potential.
And, the height of pessimism was earlier this year, people threw in the towel and the banks with the 1st TD’s took back the houses wiping-out the 2nd TD. That’s one possible way to explain why in most cases they didn’t do a loan mod for the homeowners. There’s money to be made on wiping out a 2nd TD. Now though, I think more people will hold on as things appear to be getting better.
What happened to working for the back gate homes and Pauma/Fallbrook modulars?
My wife and I considered that first house in the Davidson tract of La Costa Oaks, but we were turned off by the hill up the back. From the Bird’s Eye it looks like the neighbor above has a sand-pit volley ball court a little too close up there. The front landscaping is also bit too scrubby for our taste, and I’m guessing the view beyond the houses across the street is over to the power lines. Sure sounds like it would be a good deal at $850K-$900K, down from $1.25M (but it would be really nice to see this trend carry over to some of the other La Costa neighborhoods). I can’t put my finger on it . . . there’s just something about LCO that seems sterile. Maybe the area simply hasn’t matured nicely due to the whole RE meltdown.
wow, WSJ called Jim out by name WITH a direct link. congrats!
Great video Jim. Very interesting.
Mortgage bankers are experiencing a dramatic increase in new servicing hires and loss mitigation staff in order to handle the tidal wave of delinquencies sweeping the nation. Speaking at SourceMedia’s Best Practices in Loss Mitigation Conference in Dallas, Stephanie Lowe, vice president for special servicing and loss mitigation for GMAC Financial Services, said her company has added more than 500 employees and developed a technology system in-house to deal with bulk decisions. GMAC Financial Services offers three weeks of classroom training as well as a week of intense on-the-ground training for employees to learn more about how to explain the Home Affordable Modification Program to borrowers.
First the LA Times article, then the Nightline interview, and now the WSJ with a link! It’s all well-deserved, Jim, very well deserved…
Do people who pay there bills get a loan modification?Why is it the gambelrs get a bailout.Am I living my life wrong?
Nicely done Jim…..looking forward to your interview with Oprah.
I’m frustrated because I can’t enjoy these videos. The whirlin circle comes after about 8 words so no continuity. Does anyone have a tip about what media player I should install? I know you’re not IT guys but any help would be appreciated.
The whirlin circle comes after about 8 words so no continuity.
If it’s not your internet connection, then make sure to update your flash player which is what is playing the video. It’s free, look for the link in the upper right corner.
Flash Player
I’m guessing he has a very slow (dial up or equilvalent) connection. You can start the video, pause it immediately, walk away, and then watch it ten minutes later after it’s loaded.
Great videos Jim. I wish we had a Jim the Realtor in Atlanta.
fd in to, check to make sure you have the latest release of your browser. Do other videos on other sites work okay, or just here?
2Q09 contest wraps up Thursday, today’s count is 5,874.
5,900 Genius
5,950 Erica
5,955 Strider
5,983 CA renter
5,991 osidebuyer
6,000 doughboy
I have four field-level tickets to tomorrow’s day game Padres vs. Marlins at 12:35pm.
Anybody not going to opening day at the track, besides me? You can take in the Padres!
email: jim@jimklinge.com
Jim:
As a former resident of California and now living in Minneapolis, its great fun seeing what is happening in other markets, especially at the prices/sqft that houses are going for.
Love the videos.
Tom
California Dreamin’
http://www.nytimes.com/2009/07/22/us/22calif.html?_r=1&hp
But three decades of staggering population growth combined with three high-impact recessions, budgeting by ballot box, federal mandates, an unusual tax structure and the rising cost of social services have finally produced disastrous results, and the ramifications are reaching across every aspect of life in this state.
The California dream is, for now, delayed, as demonstrated by the budget state lawmakers and the governor agreed upon late Monday. At no point in modern history has the state dealt with its fiscal issues by retreating so deeply in its services, beginning this spring with a round of multibillion-dollar budget cuts and continuing with, in total, some $30 billion in cuts over two fiscal years to schools, colleges, health care, welfare, corrections, recreation and more.
The rest of the nation, which has historically looked to California as a model for fierce economic independence and freewheeling innovation, may now see that the state looks like every place else — just with better beaches.
***
“Compared to the post-World War II era, an in-migrant to California now faces higher cost housing, lower quality K-12 schools, and more expensive higher education,” said Daniel J. B. Mitchell, a professor emeritus at the School of Public Affairs at the University of California, Los Angeles.
“He or she also faces job opportunities that more or less mirror what is available on average elsewhere in the U.S.,” Professor Mitchell said.
California’s in a pinch, Atlanta’s run out of water.
What’s next?
$200/sf in nicer areas, and at today’s interest rates. Now we’re getting somewhere. Not totally there yet, but definitely on the way.
FYI. I went to the El Cajon trustee sale to bid on a duplex. The auctioneer examined my cashier’s checks before bidding and told me, “I can’t use these.” I expressed my dissatisfaction. He told me Cal-Western Recon. will not take cashier’s checks older than 30 days.
Bottom line Ronald is that CA, and SD in particular, is no place to be middle class. The people in that bracket are poverty stricken here, whereas in many other states there are more services in virtually every area for them.
But CA isn’t alone, parts of NY are this way too. And like here, people move elsewhere to build their fortunes.
I must admit surprise at what I found here. I am late for the party, it seems.
How is the middle class poverty stricken, JimB? You and others make blanket statements and then purport your opinions to be reality. Not everything is a conspiracy and not everyone lives in poverty. I guess middle class poverty for you means not being able to eat out every night.
ChrisL,
I know plenty of “middle class” couples that can’t seem to get ahead in SD. I also know (because I travel for work) that couples in other parts of the country have a much higher standard of living and make less $$$ than what people do out here. I guess the term “Poverty” can mean different things to different people.
I don’t understand why many seem to think the middle class has no business in CA and SD, unless one measures quality of life by the type of car, jeans and electronic gadget one owns.
It really is awful here. I’d be happier anywhere else in America. San Diego is particularly bad. Just a warning for anyone thinking of moving here.
Generally speaking, for those who purchased a home within the last 2 – 4 years in San Diego at around 600K your household better be making over $180K per year which should give you enough for savings contributions, travel, college fund, and day care. Of course you wouldn’t or shouldn’t be pimpin’ a late model Porsche, BMW, Mercedes, etc. 180K is more than 2X the median household income in San Diego.
“You and others make blanket statements and then purport your opinions to be reality.”
I suggest you visit some other states and talk to the CA people there. Sure, they may be a little biased, you might be surprised with what they say.
I’m here with good intentions. But I cannot ignore it’s uncommon how people here seem to be ‘lowest’ cost driven when it comes to shopping.