How many foreclosures are there really in Northern Virginia?
This is a question that is getting harder and harder to answer every day. Looking at the MLS will give you some data, not all of it marked by agents in a way that makes it easy to find, the county tax records give you a different set of numbers and then you count the homes that are headed to auction this weekend and not in the MLS you get yet another answer.
So what does this mean for a buyer who is seriously interested in buying a foreclosure property? For most of the clients I talk to it is a matter of timing. We can only look at what is listed either in the MLS or one of the other public foreclosures sources. Obviously looking at the tax records can help identify homes that might be coming into the system in the near future but we have no idea when or at what price those properties may be offered for by the banks and mortgage companies.
For example in Prince William County if you search the Real Property Assessment site for the month of December 2007 between the prices of $200,000-$300,000 you will find 507 sales recorded in the county database. The MLS only shows 134 properties sold in that same period of time and in the same price range. The highest portion of sales was banks “buying” properties as part of the foreclosure process. Now what makes this study interesting is the second part of the analysis.
Checking a few of the properties that were sold back to the banks I then checked the MLS to see if the properties had been listed and if they were what was the list price. I then compared the current list price to what the county records show the banks bought them for in December. Now we start to get a glimpse of the percentages of value that the banks will consider to sell one of the properties. It also gives buyers and agents an idea of how aggressive you can be on your offer price on foreclosures.
|10129 IRONGATE WAY||$181,900||$119,800||ACTIVE|
|10111 IRONGATE WAY||$177,000||$145,000||ACTIVE|
|7813 WEST POINT||$184,500||$108,900||CONT|
|8851 TEAKWOOD CT||$200,000||$124,000||ACTIVE|
|10120 SHILOH CT||$193,500||$114,000||SOLD|
Obviously this list is not an exhaustive study there are a lot more properties at a variety of price points to review. Since I am currently working with buyers who are writing contracts on foreclosure properties looking at the price differential is important to determine how significant a difference in price can we expect to have the bank accept. I have one accepted offer now that is 50K below the MLS list price.
If you are considering buying a foreclosure property remember that most properties are sold “as is.” Making sure that you have budgeted not only for the purchase price of the property but the repairs as well is an important part of your consideration to determine whether a foreclosure property is the right home for you.