Under the Worker, Home Ownership, and Business Assistance Act of 2009, which was extended November 6, 2009, eligible Navy families can wait till April 30, 2011 to become under contract on a property. That is great news for Navy personnel who is serving outside the outside the United States for at least 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010.

Additional Information from IRS.gov

Members of the military and certain other federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and qualify for the credit. Thus, an eligible taxpayer must buy, or enter into a binding contract to buy, a principal residence on or before April 30, 2011. If a binding contract is entered into by that date, the taxpayer has until June 30, 2011, to close on the purchase. Members of the uniformed services, members of the Foreign Service and employees of the intelligence community are eligible for this special rule. It applies to any individual (and, if married, the individual’s spouse) who serves on qualified official extended duty service outside of the United States for at least 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010.

In many cases, the credit repayment (recapture) requirement is waived for members of the uniformed services, members of the Foreign Service and employees of the intelligence community. This relief applies where a home is sold or stops being the taxpayer’s principal residence after Dec. 31, 2008, in connection with government orders received by the individual (or the individual’s spouse) for qualified official extended duty service. The credit is still allowable even if this happens during the year of purchase. Qualified official extended duty is any period of extended duty while serving at a place of duty at least 50 miles away from the taxpayer’s principal residence (whether inside or outside the U.S.) or while residing under government orders in government quarters. Extended duty is defined as any period of duty pursuant to a call or order to such duty for a period in excess of 90 days or for an indefinite period.

Things to Know When Buying Bank Owned Homes

– Pre-Approval Process
– As-Is Clause
– Highest & Best Offer
– Communication & Response Times

Pre-Approval Process

It is common when purchasing a property to have proof of funds and/or a pre-approval letter provided with a purchase and sale. This has not changed. However, who the pre-approval letter has been issued by has. In the previous post, Wells Fargo and Bank of America have dramatically increased the number of originated loans and I correlate that increase to buyers having to be pre-approved through them just to submit an offer on one of their properties. Having buyers submit for a pre-approval letter has caused a lot of frustration for buyers due to the additional step required and concerns over how it affects their credit score. So far, I have not seen the additional pre-approval affect credit scores or ability to obtain financing.

As-Is Clause

The most common verbiage used in a banked owed property’s addendum and advertising remarks is “as-is”. “As-is” means just that and the banks do not and will not take any responsibility for the condition the property is in, unless the property defects are called in the lender’s appraisal. In a normal transaction, a buyer will conduct a home inspection (Form 35) and then after ask for seller concessions in the inspection response (Form 35R). In the case of a bank owned property, the seller will not fix or give concessions to the buyer. Be very aware of this point as renegotiating the original contract could hinder or prevent a successful purchase.

Recommendation: Conduct a pre-offer inspection and become aware of any defects. This way, the requested work orders can be written into the purchase and sale agreement and avoid any renegotiations.

Highest and Best Offer

It has become standard practice by listing agents of bank owned properties not tell the parties involved what other competing offers are; they just say “present your highest and best offer”. To me this is a poor practice and does nothing to facilitate the sale of the property.

The result is ambiguity. As a buyer’s agent, I like the most information as possible so I can provide the best consulting services for my clients. With having no information, other than “present your highest and best”, there is nothing to ride with. If the numbers where known to the buyer’s agents then it would allow for the buyers to either stay in the transaction by raising their offer or bowing out and not wasting time on the transaction.

Communication and Response Times

Communication and response times are another area in which buyer’s agents have to be aware of. In a typical transaction communication happens between buyer’s and seller’s agent and their respective clients and response times are short – making for a speedy and informed transaction. With bank owned properties there are still the agents involved but one represented party is an entity (even though there is a person managing the file). This poses unique communication challenges and delayed response times.

The asset manager for the bank is usually working on 300 – 500 files at one given time and closing 10 -15 files per month. Not a large volume considering how many files the asset managers are working on. This leads me to believe that asset managers, as well as REO listing agents, want to try to have the smoothest transaction possible and why REO listing agents can be so hard on buyer’s agents. In addition, the amount of files on asset manager’s desk, at any given time, increases the amount of time between responses, if a response comes at all. Just be prepared.

Managing Buyer Expectations

From the agent’s standpoint this could be one of the most important aspects on a bank owned property purchase. As we have seen, the purchase of a bank owned property has some interesting quarks from normal transaction and knowing them up front will help the buyer’s understand what to expect moving forward. It is important for buyers to understand the process, even though it’s similar, and to expect that they may not be in the driver’s seat.

Related Post: Short Sales and the Foreclosure Process

As residents of Snohomish County know, the topography allows for a variety of different types of settings – river and lake front, mountain and territorial views, old growth forests and protected growth areas are just some attributes buyers are looking for. Each of these property types pose unique challenges.

Challenges of Vacant Land

– Determine how much of the land is usable through an environmental impact study. It is easier to spend a few hundred dollars to conduct a study then it is to purchase a property that can’t be used as intended.
– Has the property been tested (perked) to see if it can have a septic system installed (only if the property cannot be attached to city sewer)?
– Is there access to potable water on the property from either a well, share water source, or through city hook ups?
– Will the property require excavation to construct a access area?
– What are all the permits required to take a piece of raw land and make it livable, and most off, legal? In addition, what are all the costs associated with the many permits required?

Recommendations

– Take some time to walk the property and get a feel for the topography, wetness or dryness of the soil, and how much brush/trees are on the property.
– Visit the Snohomish County Planning & Development’s office for questions on properties and use their online resources (personal favorites: boundary line maps, planning & development homepage, assistance bulletins).

Here is an example from the other day while out showing land.

The subject property was located on the South Fork of the Stillaguamish River, outside Arlington, and from the online pictures the parcel looked like it was a gorgeous river front. But online pictures can be deceiving. Part of the problem with online pictures is advertising itself. Real estate agents do a great job of photographing a property to make it appear as good as it can.

The downside is the pictures may not truly represent the condition of the property. With a slight change of camera angle it is easy to avoid marshy sections and to skip out on other not so desirable areas.

Vacant and raw land has its challenges but if you are wanting to take the time and energy to go through the whole process the reward could feel like another world.

Being an active agent, I can contest to both scenarios being true. Great homes with no home inspection issues and excellent buys that require sweat equity. In 2009, one of my clients purchased a short sale and by doing so he received an excellent deal on a home in Mill Creek. This home is situated in a established neighborhood with few fixer uppers left – this home seemed to be the troubled home on the block. On the flip side, a few other 2009 clients purchased bank owned homes in Marysville that where just a few years old and required little to no work.

The Fixer Upper

The majority of the short sales and banked properties fall into this category because the owners, or previous owners, where going through financial hardship and as a result regular home maintenance was neglected. This is not uncommon and, in my opinion, should be expected. My Mill Creek client purchased the home because it needed an injection of blood and sweat to recapture the brilliance the home once had. But this may not always be the case. When showing to clients I come across many homes that are rapidly approaching the point of no return. The homes are in such poor condition that it is highly recommended to have additional inspections, pest and mold etc, just to see if the purchase would even be worth it, envision The Money Pit with Tom Hanks and Shelley Long (1986). Both scenarios require a heavy investment of money, time and oodles of patients. When buying the fixer upper make sure you know what you’re getting into and ready for a lengthy hands on home.

The Great Deal

Some short sales and bank owned properties fall into The Great Deal category. Again, in 2009 I worked with a family to purchase a short sale in Aspen. The home was just a few years old and looked like it never had been occupied. It was outfitted with every known functional and cosmetic upgrade and was a classic example of Northwest Architecture. Another two buyers, also in 2009, purchased bank owned homes in Lake Stevens and Marysville that where built in 2006 and needed zero to a little touch up work at extremely low prices. These buyers took their time watching the market, viewing many homes and waited for that right home to appear. Both parties had goals of putting the least amount of money and time into the home post purchase. This has left them time to take weekend vacations instead of working on their home.

The property condition spectrum for short sales and banked owned properties can swing from “like new” to “I need a shower when I leave” so just be very aware what you are purchasing. As of March 8, 2010 there are 724 short sales and 339 bank owned properties in Snohomish County with those numbers expecting to rise in the next few months. So if you’re looking at banked owned or short sale properties there are no shortages.

Related Page: Bank Owned Property Search

Related Post: Short Sales and Distress Properties

Throughout the Home

1. Open the draperies, pull up the shades, and let in the sunlight.
2. Create a positive mood. Turn on all lights, day or night, and install higher wattage light bulbs to show your home brightly.
3. Remove clutter from each room to visually enlarge them.
4. If you have a fireplace, highlight it in your decorating.
5. Keep your home dusted and vacuumed at all times.
6. Replace the carpet if it does not clean up well.
7. Have a family “game plan” to get the home in order quickly if necessary.
8. Air out your home for one-half hour before showing, if possible.
9. Lightly spray the house with air freshener so that it has a chance to diffuse before the buyer arrives.
10. Put family photos in storage.
11. Improve traffic flow through every room by removing unnecessary furniture.
12. Create the feeling of a spacious entry area by using decorative accents and removing unnecessary furniture.
13. Putty over and paint any nail holes or other mishaps in the walls.
14. Paint all interior walls a neutral color to brighten the home and make it look bigger.
15. Repair or replace any loose or damaged wallpaper.
16. Clean all lights bulbs and fixtures to brighten the home.
17. Wash all windows inside and out.
18. Use plants in transitional areas of your house.
19. Make the most of your attic’s potential.
20. Remove and/or hide excess extention cords and exposed wires.
21. Open doors to areas you want potential buyers to see such as walk-in closets, pantries, attics, etc.
22. Remove all smoke and pet odors.
23. Repair or replace banisters and handrails.

In the Kitchen

24. Microwave a small dish of vanilla twenty minutes before showing and place it in an out-of-the-way place.
25. Highlight an eat-in area in your kitchen with a table set for dinner.
26. The kitchen and bathrooms should always be spotlessly clean.
27. Expand your counter space by removing small appliances.

In the Bathrooms

28. Create a master suite effect in your decorating.
29. Depersonalize bedrooms and decorate in a neutral scheme.
30. Make sure that the beds are made and the linens are clean.
31. Organize your closets, remove unnecessary items and put them storage.

In the Bathrooms

32. Do not leave towels around and wipe down the sinks and shower areas after each use.
33. Re-caulk the tub if the caulk is not sparkeling white.
34. Repair or replace broken tiles in the shower/tub.
35. Replace shower curtains and keep them clean.
36. Put out fresh towels and decorative soaps.

Outside

37. Keep the yard mowed and raked at all times.
38. Use flowering plants to dress up the yard, walkway, and patio.
39. Remove all toys, bicycles, tools, unsightly patio furniture, and trash from the yard.
40. Porches, steps, verandas, balconies, patios, and other extensions of the house should be kept uncluttered.
41. Paint all entrance doors.
42.Make sure the garage door opens easily. Fix and paint the garage door if necessary.
43. Clean and shine all hardware and accessories indoors and out (doors knobs, knockers, lamps, mail box, address numbers, etc).
44. Trees and shrubs should be trimmed and pruned.
45. Use a new dormat.
46. Be sure the front doorbell is in good working order.
47. Be sure the front door and screen door work properly.

Implementing these items will give any home a leg up on the competition especially when there are so many bank owned properties selling for less than the resale homes.

Before getting into the new changes it is probably worth reviewing a little history preceding the changes. The problem arose when excited buyers would inquire on a home to why the listing price was so much lower than competing homes. Feeling like they found the buy of the century and anxious to write a Purchase and Sale, buyers were quickly discouraged upon finding out the property was in a short sale situation.

The NWMLS took note of the problem and in 2009 released an update to their system allowing agents to exclude or only include short sales, bank owned or standard sellers. If a property was a short sale most buyers would immediately removed it from their lists especially since the First Time Homebuyer Tax Credit’s deadline was approaching.

But still consumers could not directly see for themselves if a home was a short sale or bank owned. Now that has changed. In December 2009, I was pleasantly surprised to find these upgrades found their way to the public real estate search sites. Right nowm, buyers can only differentiate between properties from standard sellers and bank owned, note the two different MLS search links.

– Standard MLS Listing Search
– Banked Owned Listing Search

Though the upgrades makes it easy to separate standard and banked owned properties it does not do anything for the appearance of short sales. A system should be fairly simple to build but granted I am sitting here describing the features instead of developing the code for it. When a real estate agent uploads a home to the NWMLS there are various fields that can be checked or not checked. From water front and swimming pools to builders and neighborhoods, the variety is endless and that is why getting as much information about a home makes the property far more searchable.

Consumers still don’t have the luxury of excluding short sales from their results like agents do. No fear though as they can be identified under the Property Details in the Residential field.

As of right now, public IDXs are having problems processing the new 3 digit code and as a result the properties may not be displayed, happening on this site. If you seen a home and it has the 3 digit MLS code please email or call me and I will send the information over.


It has me curious as to what type of technology will be the norm by the end of 2010. Will users demand websites to have a mobile friendly website or an app with all the homes for sale? It has me thinking.

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The first home buyer tax credit applies to a home purchased between the dates of April 8, 2008 and December 31, 2008. If a home buyer purchased a home within that range they are eligible for a $7,500 maximum tax credit which can be claimed on a 2008 return. This allows for people to receive more money back on a return or have money applied to taxes owed. But this is not a free and clear plan to get $7,500 government dollars.

The tax credit, for homeowner’s who purchased a home in 2008, is an interest free loan. The interest free loan has to be paid back over a period of 15 years at $500 per year starting in 2010. The tax credit doesn’t look so appealing when viewed as a loan. But if you’re a recent purchaser and have felt the crunch of job slow downs this could be a great way to put some savings in the bank for future house payments.

The second home buyer tax credit applies to home purchased from January 1, 2009 till April 30, 2010. For these group of home buyers the tax credit has been increased by an addition $500 to total $8,000. Unlike the 2008 credit which acts as an interest free loan, the 2009 – 2010 credit is a permanent loan which does not have to be repaid.

Time for the catch. If the home is sold within 3 years then entire $8,000 is recaptured at the time of sale. So be careful if you select to use this option because if you have to sell due to financial hardship, in non equity building market place, then this will further compound the problem.

The Housing and Economic Recovery Act of 2008 provides interesting benefits to recent homeowners; but why not extend this program back to 2006 to help curb foreclosure rate? That could be a whole other topic it’s self. So if you are looking or have already purchased a home these two programs could help make life a little more favorable.

Eligibility is base more than just the date a home was purchased but the constraints are not ridged but any of the following describe you then you cannot qualify for the tax credit.

– Your income exceeds the phase-out range. This means joint filers with MAGI of $170,000 and above and other taxpayers with MAGI of $95,000 and above.
– You buy your home from a close relative. This includes your spouse, parent, grandparent, child or grandchild.
– You stop using your home as your main home.
– You sell your home before the end of the year.
– You are a nonresident alien.
– You are, or were, eligible to claim the District of Columbia first-time homebuyer credit for any taxable year.
– Your home financing comes from tax-exempt mortgage revenue bonds.
– You owned another main home at any time during the three years prior to the date of purchase. For example, if you bought a home on July 1, 2008, you cannot take the credit for that home if you owned, or had an ownership interest in, another main home at any time from July 2, 2005, through July 1, 2008.

Overview Housing and Economic Recovery Act of 2008

Source: IRS.gov

Now home buyers across the nation are probably asking themselves the questions: Will the home buyer tax credit be extended? Will the home buyer tax credit be increased? Will the home buyer tax credit back fire on the economy if it is kept or let go?

Charles Richey, at the Examiner, touches on a topic that may have the government rethinking any home buyer tax credit, home buyer tax credit fraud. Fraud could halt any extensions to current programs and/or the development of new programs, which are trying to be increased to a whopping $15,000 tax credit by John Isakson.

There also has better chatter “if” the tax credit should even being extended, Jay Thompson is still formulating his position. Others are pretty adamant about not extending the tax credit, just take a look at the opening comments.

But what happens to the economy after November 30, 2009 when the tax credit stimulus is scheduled to end?

I think markets will see an immediate retraction with home sales slowing and eventually returning to 2008 numbers. Markets like Snohomish County that are missing some key economics factors, like jobs and consumer confidence, will be hit the hardest and that is why I am for continuing the tax credit.

Here are my top 3 reasons why the tax credit should be continued, modified, and extended (is a *change of opinion* disclaimer needed here?).

1. The tax credit will help move the economy forward after the New Year by providing positive motivation to purchase
2. The tax credit’s benefits will spill over to other industries that depend on a healthy housing market
3. Smaller markets will take long to recover than major markets

The last item is the most important in my opinion and is a topic not touched on in a recent Bloomberg.com article. The ending of the tax credit could have ramifications on smaller and recovering markets, like Snohomish County, that could stall or reverse any recovery these areas have seen. The Snohomish County market is no different than the many others that depend on strong employment to maintain growth and consumer confidence.

At the moment neither of those two items are not strong in our area. So forgive me if I disagree with Kase to phase back incentives because 20 cities across the United States are seeing an increase in housing values.

“We’ve got to phase back incentives and this may be a good time to do that” – Karl Kase”

Allow for a little more time to for consumer confidence to return and employment stabilize prior to calling it quits to a program only announced February 2009. The Snohomish County economy is not going to recover over night, nor with a one shot solution, and I think if the tax credit where to be extended another 6 months areas like Snohomish County would be stronger for it.

In the State of Washington, real estate agents are allowed to practice limited law; in that they are allowed to negotiated and engage parties in a binding contract to purchase residential property (condos, commercial and vacant land are also included). The implications of entering a contract are important to both parties and understanding the purchase and sale form will help alleviate questions and concerns regarding the home buying process. Below is image of page 1 of the Residential Real Estate Purchase & Sale Agreement. Page 1 is where all the terms are outlined and how the negotiation process begins.

Purchase & Sale Items # 1-5

The first 5 items identify the parties involved, the agreement date is taking place, identification of the property and which items are to be included in the sale of the home. Number 5 is the most important part of these items since it outlines what personal property will conveyed along with the property. Word of caution; try not to include to much personal property in the purchase and sale as it can be very difficult to determine an agreeable value.

Purchase & Sale Items # 6-8

Items # 6-8 are the purchase price, earnest money and the buyer’s remedy if they elect to default on the purchase and sale.

In today’s real estate climate majority of home buyers are electing to offer less than the asking price. This is due to the deflation of real estate values and the buyer’s feeling of “getting a deal” which is a strong driving force today. Seller’s should be aware that buyer’s are offering a minimum of 10% less than the asking price so prepare yourselves.

Item # 7 is the earnest money. First of all what is it? Earnest money is the amount of money a buyer is willing to place on the negotiating table in case the buyer chooses to default on the purchase and sale (# 8 is the default section). It can be either in a personal check, promissory note or “other” (I don’t recommend the “other” category). Another use of the earnest money is to demonstrate the serious of the buyer’s intentions to purchase the proeprty to the seller.

Note: Some sellers and real estate agents use earnest money as negotiating leverage during a counter offer.

Item # 8 is the buyer’s selection in what the remedy would be in case of default. The majority of the time the buyer elects to choose to Forfeiture of Earnest Money. Opting for the Seller’s Election of Remedies opens up to many options for the seller to choose and that scares buyers.

Purchase & Sale Item # 9

Disclosures in Form 17 is a form the seller provides stating their knowledge of the property’s conditions. This form is a Q&A section of the scenarios that the seller is sharing with potential buyers. Some of these questions are: has the roof leaked?, has there been any hazardous material disposed of on the property?, and many other items. But item 9 is not the form but the buyer’s choice to either “will” or “will not” have remedies for the seller’s errors.

Purchase & Sale Item # 10

Item # 10 identifies the title company who will be providing title insurance on the property. Title insurance protects the buy from any encumbrances on the property. John Wahl did a post titled What is Title Insurance? that gives a good overview. This is another item that lenders will want to look at. Lenders do not want to loan funds on a property that may have encumbrances or other liens that may affect interest in the property.

Purchase & Sale Item #11-13

Items # 11-13 stipulate who is the closing agent will be, that’s the escrow company, the closing date and when the new owner takes possessions.

The closing agent is usually a escrow company but it also can be handled by attorneys. The closing agent reviews all the documents, provides a HUD-1 and sees if there are any outstanding payments that need to be paid prior to the property changing possession.

The closing date and possession date are two different items. The closing date is the date in which the county receives the recording numbers and ownership/title is legally transferred.

Possession doesn’t necessarily happen on closing (when the new owner receives the keys). In Snohomish County is typical to see the “other” boxed checked with the verbiage “closing plus 3″. This gives the previous owner 3 days after the closing date to move out of the property. When homes are vacant there is no need for the “other” and “on closing” is checked and the keys to the property are received at the time of closing.

Purchase & Sale Item #14

Offer expiration is the time period in which the offer is no longer valid. This protects the buyer from a future obligations regarding that offer and allows the buyer to move forward with another property. But having the offer expiration doesn’t mean the offer is completely dead. If the seller provides a counter after the expiration date then the buyer has the option to accept the counter offer and the new dates or not.

Purchase & Sale Items # 15 & 16

These next two items deal with disclosure of who are the utilities providers and if any assessments are to be paid at time of closing. Services of of Closing Agent of Payment of Utilities is there to provide a) the buyer a copy of who provides services and b) provides the closing agent with information on whom to contact to see if there are any outstanding invoices. Outstanding payments are the biggest concern for buyers because they do want to assume a seller’s past negligence when purchasing a property. These payments can include unpaid homeowner association dues.

Purchase & Sale Items # 17-18

Item # 17 is the Agency Disclosure. In the past, the way the agency law was written, even though the buyer’s agent was representing the buyer, under the State’s law the buyer’s agent was representing the seller. This confusion led the law to be amended and forms changed to disclosure which party the agent is representing.

Item # 18 is the location where the other addendums are noted which include but are not limited to are: Financing, Home Inspection, Short Sale and Title Contingencies. Since there are some many addendums some with be touched on in the future.

That is breakdown of the residential real estate purchase and sale agreement. There are 4 other pages in which the buyer/seller have to initial but the pages are the definitions for the items mentioned in page 1.

Being familiar with the purchase and sale can provide a lot of opportunities for buyers to build negotiating leverage but no one says a seller cannot provide a counter offer, which is the majority of the times.

What is a Short Sale?

Lets look an example: Homeowner A has a $300,000 mortgage and is forced to sell the property as a way to avoid foreclosure. Faced with selling, A contacts his REALTOR® and schedules a listing appointment. Mr./Mrs. REALTOR® conducts a Comparative Market Analysis (CMA) and determines a list price. A agrees to list the property for $265,000. This is a short sale; when the property is selling for less than the homeowner’s mortgaged amount.

Short sale properties can be more challenging than traditional transactions because all aspects of the Purchase & Sale have to be approved by the lien holder. Adding an additional party to the transaction also slows down the communication process and sometimes the lien holders take twice as long to respond, even on the minor questions.

When viewing properties online look for the verbiage “short sales” and “subject to underline lien holder approval”.

What is a Distressed Property?

At first light it may seem that a short sale and a distressed property are the same thing. This is actually not the case. A distressed property is when homeowner B is behind on monthly mortgage or has a high risk of defaulting on payments and is forced to sell the property; not necessarily selling for less than the mortgaged amount but it can be both distressed and short sale. In this case a seller is looking for a low market time and pricing is critical to get the home sold with the seller netting zero or having to bring money to the table at time of closing.

What is the Foreclosure Process?

Foreclosure is a process and not necessarily a property. To better understand the foreclosure there are specific dates in a timeline when actions take place. The very first part is: when is a property in default? Technically, it is on the 1st day the mortgage payment is late but banks usually have grace periods built into payment terms. This is when the foreclosure process begins and, technically, the homeowner has 190 days before the property is sold at auction (day zero). As the process continues there are some other main time frames: 120 days is the Notice of Default, 90 days is the Notice of Trustee’s Sale and 11 days before Auction is the last date to reinstate.

*Note: Auction date is set at Zero and the timeline works backwards, download full-size image.

An important part of the timeline for buyers of a foreclosed home is the possession date. When a purchaser buys a property at auction the buyer does not receive possession right away even though they have legal title on the property. The date of possession is 20 days after purchasing the property at the court house because the previous owner now becomes a tenant and requires a 20 day notice to vacate (if the previous owner is still in the home).

REOs

REO stands for Real Estate Owned. It applies to a property owned by a lending institution who acquired the property through the foreclosure process. REOs don’t have to be taken back by a bank and can be found at other institutions like the VA, HUD, Fannie Mae, Feddie Mac, FHA, IRS, FDIC, USDA and even the Small Business Association and Army Corp. of Engineers. Like short sales, REOs can take a long time to purchase because of the response time when dealing with the bank and cause more headache that initial impression of “getting a deal”.

What does this mean for the real estate market?

As more and more properties become available that are either short sales, distressed or REOs it is going to affect the price/value of the homes currently on the market. Banks want to get these properties off their books so they can qualify for government bailout funds (which the public will not see any benefit from) and as a result the prices are falling below market value. When these properties close and enter the databases, REALTORS® and appraisers are forced to use when determining the value of a property thus continuing to soften the market.