The answer in many cases is that they are much better than before. There were several listings in South Riding and Manassas in the last 30 days which went into contract in less than 30 days, and several had multiple offers within the first few days of being listed. So if the banks do the right pricing, there are buyers out there. For the REO properties (REOs are bank owned properties see Buying REOs) there is competition between retail buyers and investors. The number of properties less than 150k is much higher in Manassas/Manassas Park than in South Riding. If you look in to Northern VA Housing bubble fallout, there are several properties in Prince Williams County which are listed 50% below their last sales price. In South Riding, most of the REO properties are in the 300k to 700k price range and there are quite a lot of primary residence buyers. An example is this house 25778 DONEGAL DR,CHANTILLY VA 20152 listed for 524k (down approximately 31% from its last sales price of 833k) was under contract within one week. If you look at 7515 Bosbury Ct., Manassas, VA – it had multiple offers within the first few days as it had a promising positive cash flow according to current rental comparisons.
So here are few things to consider if you are looking into REO properties:
- All REOs are not deals. Banks are not that stupid as they are ultimately answerable to their shareholders.
- The process can be lengthy as compared to a regular property, although banks are much faster to respond now sometimes within 24-48 hours.
- Get ready for minor cosmetic repairs – that’s why you are getting a deal in the first place (if you are getting one J).
- Banks are more flexible if the property has been listed for more than 90 days.
- Have your finances in place and don’t put a lot of contingencies. Banks want to move fast and don't want to wait till you sell your house (or for any other reason).
- Small banks are easy to deal with.
- Of course cash is king in REO offers.
- Get ready to compete in a multiple offer situation.
- Work with a realtor who understands the REO process as well as local market conditions.
