An amazing story was posted yesterday by a commenter in the Bits Bucket section over at Ben's Housing Bubble Blog yesterday.
I wanted to highlight it here before it got lost in the hundreds of new posts that will be there today.
I called the post "amazing" because it was proof to me that getting out there and submitting low offers on foreclosures will be responded to by the bank. It was a refreshing antidote to this unbelievably pessimistic article by Elizabeth Razzi over at the Washington Post: Tortuous Short Sales: Cheaper Purchases That Aren't Always Worth It. (The title says it all). In Razzi's words: "Why volunteer for such a hassle [buying a short sale] when the local market is glutted with similar homes that you could purchase more easily?"
In this particular case, to be fair to Razzi, the house was a foreclosure rather than her dreaded short sale.
The house in this post (12850 Fleetwood Drive, Nokesville, VA 20181) was built in 2006 and sits on 10 acres in Nokesville in Prince William County. It was featured on this blog when it was first listed for $730,000 on 08/31/07 (13.5% less than its purchase price on 6/5/2006 for $843,920). It was subsequently reduced to $660,000 by 11/05/07, for a 22% reduction over its prior sales price.
Here's what Lost in Nova offered, and he actually got a response back:
"Comment by Lost in Nova
Another story from NoVA….
We placed a bid on this place Address: 12850 FLEETWOOD DRIVE: NOKESVILLE, VA 20181. REO original owner in 06 purchased in June of 06 (Was brand new in June of 06) the bank has held it for about 8 months now, not a single bid on this 10 acre, 4000+ sqft + 2100 sqft unfinished basement home. The original owner paid 800k+, had some down payment because the note was for something like 620k, bank was asking 715.00..The comps killed this place a really nice home (in immaculate condition) on 24 acres with 3-4 useful outbuildings just had sold for 750.00k….Also this house is on a flag lot (with perhaps a 1000 ft gravel driveway) and you could tell the owner had stretched, no deck, no landscaping to speak of (a few straggly trees) the refrigerator was missing, some light fixtures missing, the kitchen island countertop was damaged (and oddly enouh seemed a few inches to short) when we looked at it there was crap in every toilet and they would not flush, the upstairs carpet was stained (dyed?) a varied and wonderful set of colors and the basement had a standing pool of water.
We offered 256,400. They called back on Saturday, and said the offer was too low and that if we would up it somewhat higher, they did not want to carry the house through winter (it did not look winterized to me)….My original max had been 350k, I was going to counter with that having the strange feeling they would take it…But then I had a moment of clarity…..Why am I caring so much about this property? There are MANY other REOs in this price range that are much nicer…My wife took a deep breath, thanked the gentlemen for their time and kindly told them that if in six months we were still in the market and the property was still available we would revisit it, but in all likelihood the offer would be lower.
-Lost in Nova"
I think "Lost's" wife was prudent, and I hope they keep trying and find success. For those of you who find something you really like, I hope it encourages you not to be daunted by the list prices. This couple initially offered 70% off of the prior sale and 66% off the county's assessed price, and the bank was willing to continue negotiations.