Unrealistic Short Sale List Price

Norcal Jim · 01:47 PM

Is there any kind of guidelines/restrictions on short sale list prices or can the seller just price it however low they want subject to lender approval?

ISellRiverview · 05-05-2008, 04:37 PM

Different banks have different guidelines. I've heard anything from 80% of what is owed, to 80-90% under market value. Just depends on the bank. I wish it was an exact science.

erogers · 05-05-2008, 04:50 PM

Your client can list the home as low as they want - but go too low and the lender is probably going to counter or reject.

Tsena · 05-05-2008, 06:32 PM

You should list the home in relation to what comps are showing. Every two to three weeks you should lower the price until you get an offer. Once you get an offer, submit the offer along with the pricing history so the bank is aware where the home was listed and the gradual decline in price over time. This informs the bank that the chance of this home selling at a price higher than the offer is slim and it increases your chance of getting the offer accepted.

If we have been very successful in pricing our listings this way and have only had a few of the offers we receiving countered by the bank.

Discover Davis Homes · 05-05-2008, 07:29 PM

I see this happen here quite a bit, the list price is way below market. I think the sellers are looking for multiple offers and the listing agents looking to hear directly from potential buyers. I don't think a lot of these listings are selling. Anecdotally, I have heard that only 20% of all short sale listings result in a successful transaction.

rmasse10 · 05-05-2008, 09:09 PM

The seller can put the price anywhere they want as in any case...they own the house. In this case, the bank becomes a 3rd party approver. It is best to set the price as close to what an appraiser is going to appraise the home at since this is what the bank is going to have to go by themselves...otherwise, you may just get a lot of unhappy campers

docmuller · 05-05-2008, 10:02 PM

I have seen owners pricing $50 to $60K below market value. It is an absolute mess. The banks never say yes, and it wastes a ton of time

dylan · 05-05-2008, 10:17 PM

See if you can talk to the bank before you put the listing on the market. The banks are getting easier to talk to.

Norcal Jim · 05-05-2008, 11:29 PM

Actually my post was more in line with Carolyn's and Rob's. We are seeing the same thing here and it is really making things interesting.

Phoenix Real Estate Guy · 05-05-2008, 11:50 PM

I see ridiculously low list prices on short sales all the time in the Phoenix market. I'm talking $150K on homes with a market value of $300K.

It's a smarmy bait & switch tactic to get people to look at the home. The bank will never accept an offer at that price. But I bet you the listing agent has the, "Well let me show you some other homes" line down pat...

It's a waste of everyone's time.

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