Bank Owned Homes: Not a Buyers’ Market in Phoenix
Posted on March 11th, 2008 by Jonathan Dalton
If you’ve been following the weekly absorption rate report for the Phoenix real estate market, you know that a 5- to 6-month supply of homes equates to a balanced real estate market where neither sellers nor buyers hold the upper hand. There’s neither an oversupply or excessive demand for homes.
Most buyers perceive bank owned homes as the ultimate deal and believe the bank will take almost whatever is offered to get the homes off their books. That assumption also is based on the overall Phoenix real estate market being fairly soft.
But when it comes to REO properties, that’s not the case. Sales are accelerating in the bank owned arena to the point where there’s now a 5.95-month supply of homes based on the latest figures (593 sales the past 30 days against 3,533 active listings.)
It’s a balanced market.
In addition, according to the Arizona Regional MLS data bank owned homes are selling at approximately 95-96% of list price. This doesn’t include any seller incentives but those are far less common in the REO area than overall. Banks tend to negotiate price and don’t as a rule give credits (rules do have exceptions, however.)
This dovetails nicely into another NAR Code of Ethics nightmare question on Trulia Voices this morning - what should someone offer on a bank owned home? Make your best offer up front based on what you’re willing to spend. If you get the house, great. If not, accept that someone else was willing to pay more and move on.
Full absorption figures to follow shortly.
Technorati Tags: Phoenix real estate, REO homes, bank owned homes, foreclosures
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[…] Additionally, if you were planning on having the seller pay for closing costs that means you’ll be asking for more from them and costs can quickly add up. While in today’s buyers market you maybe able to find sellers willing to accommodate you, it is still something that needs to be understood as you make a purchase offer. This is especially true if you’re looking at bank owned homes. […]
I knew you’d be on that Voices question. I just answered it, and await the onslaught of “thumbs down” votes…
This is an excellent post JD, I’ve been wanting to write a similar one. Thinking I should just shamelessly steal this one.
Love the new theme BTW…