10 Foreclosure Hotspots

It’s never a good thing for one’s city to be included in any article naming cities with fast-growing rate of foreclosures. It’s also especially troubling when the picture that CNNMoney.com uses happens to be a house you’ve sold a couple times. Let’s start with that house—it’s a spectacular brick Second Empire house—a double house, actually, built that way in 1873. In 2006, both sides of the house were for sale. I had the left side of the house listed and another agent had the right side of the house listed. My clients (and now very good friends) saw both sides and decided to buy the right side of the house. We had a long negotiation with the owners and finally got about $100k off the purchase price. The market was still hot at that time and we thought that was a pretty good discount. I don’t have to tell you that the market turned south, but they’re still in the house and love it. Naturally, they would have liked to have paid less. As for my left side of the house, as the market turned, we were not able to find a buyer, despite a number of price reductions. Finally, in late 2008, we had a good offer--$735k. At the time, the seller owed about $755k. He had been making $4000 monthly payments on an empty house for two years, so that’s another $100,000 that he ate. He asked the bank if they would accept the offer as a short sale. The bank took about six months to respond to the short sale request, and eventually the buyers lost interest and moved on. And then the bank said they wouldn’t eat the $20k. So my seller stopped making his $4000 payments. We continued taking offers, which the bank continued ignoring. And nearly a year later, in early 2010, the bank finally took the property back. When it was listed in early spring of 2010, the asking price was $565,000. Naturally, I had a list of people who were interested, and I quickly got it under contract at full price. So the bank ate nearly $200,000 and devalued the property. Of course, CNNMoney happened to have used a stock Savannah photo, and couldn’t possibly know the story behind this house, but I do. And it’s the incompetence of the banks that put them in bad positions to start with. On a totally different note, the paragraph describing Savannah’s foreclosure market does mention that homes like this in the Landmark Historic District are not really causing the foreclosure jump. The sub-$100k houses are coming on the market, and the article is right—it’s investor stuff. And we need to look at the bright side of this article—there are indeed great deals to be had for buyers. In fact, I happen to have just gone under contract on one of those foreclosures, the restoration of which may be part of this blog in the future. Looking for a good deal? As always, feel free to contact me.

View the CNNmoney.com article: http://money.cnn.com/galleries/2011/real_estate/1102/gallery.latest_foreclosure_hotspots/index.html?hpt=C2