We are seeing more and more listings being offered for sale in the Orlando and Central Florida real estate market, which are subject to a short sale or third party approval. The third party in most cases being the lender who must agree to accept less than what is owed on the house in order for the homeowner to sell.
Declining home prices mixed with those homes that were purchased with 100% financing or were bought at the height of the real estate boom, now find some sellers with a real need to sell but not enough equity in their home to cover the mortgage. Faced with foreclosure or financial stress, these homeowners will ask real estate agents to list their home in hopes that the lender will agree to discount the payoff when an offer is received.
This all sounds good on paper, but what have been the results?
When researching the Central Florida multiple listing service which includes the Orlando area for numbers involving short sales, I found that in the five county area of Lake, Seminole, Orange, Osceola and West Volusia, there are currently 1373 homes listed for sale with the term ‘short sale’ mentioned in the public comments. Over the past 30 days, 28 homes listed with the remarks of short sale have sold. During this same time period however, 147 homes with the same identifying short sale comment were not sold and in fact have expired or have been withdrawn off the market.
It would appear if these numbers are accurate and a representation of the expected results over an extended period of time, then short sale situations have more of a chance to fail than succeed. This failure rate could be contributed to many reasons one of which could be the inexperience of the agent handling the sale. The time to learn how to negotiate a short sale with a lender, buyer or seller is not during the transaction. Agents should be receiving the education and training needed prior to taking a listing with a short sale contingency.
Homeowners who are faced with a short sale situation should ask the agent they are interviewing how many short sale transactions have they been involved with over their careers, how many of those transactions closed and what special training and education has the agent received on this topic.
Taking those steps may help their short sale not fall short.
Related Florida real estate views:
Real estate agents would be wise to pick short sales over long sales.
Short sales may be an option to some homeowners
Short sales offer clues to traditional home sellers
- Greg Staker - Watson Realty Corp. - 407-304-0255
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