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CITY

Select a City: No Preference Barefoot Bay Cape Canaveral Cocoa Cocoa Bch Cocoa Beach Grant Grant Valkaria Indialantic Indian Harb Bch Indian Harbour Beach Malabar Melbourne Melbourne Bch Melbourne Beach Melbourne Village Merritt Isl Merritt Island Micco Mims Palm Bay Palm Shores Rockledge Satellite Bch Satellite Beach Sebastian Titusville Viera W Melbourne W. Melbourne West Melbourne Choose a property type: Residential Rental Income Business Land

What is your price range? No Minimum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000 No Maximum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000

Number of rooms required? Beds 1 2 3 4 5 6 7 8+ Baths 1 2 3 4 5 6 7 8+

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SUBDIVISION

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Choose a property type: Residential Rental Income Business Land

What is your price range? No Minimum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000 No Maximum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000

Number of rooms required? Beds 1 2 3 4 5 6 7 8+ Baths 1 2 3 4 5 6 7 8+

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AREA

Select a Area: No Preference 101 Mims/Scottsmoor 102 Mims/Tville SR46-Garden 103 Titusville Garden- SR50 104 Titusville SR50 - Kings H 107 Port St. John 210 Canaveral Groves 212 Cocoa 213 Mainld E of US1 214 Rockledge 215 West Cocoa 216 Viera/Suntree N of Wickham 217 Viera West of I 95 218 Suntree S of Wickham 250 N Merritt Island 251 Central Merritt Island 252 N Banana River Dr. 253 S Merritt Island 254 Newfound Harbor 270 Port Canaveral 271 Cape Canaveral 272 Cocoa Beach 320 Pineda/Lake Washington 321 Lake Washington/S of Post 322 Palm Shores 323 Eau Gallie 330 Melbourne 331 W Melbourne 340 NE Palm Bay 341 NE Palm Bay 342 Malabar/Grant-Valkaria 343 SE Palm Bay 344 NW Palm Bay 345 SW Palm Bay 346 West/Southwest Palm Bay 347 Southern Palm Bay 350 Barefoot Bay/Micco 355 Merritt Island S of Pineda 381 N Satellite Beach 382 Satellite Bch/ Indian Hrbr 383 N Indialantic 384 Indialantic/Melbourne Bch 385 South Beaches

Choose a property type: Residential Rental Income Business Land

What is your price range? No Minimum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000 No Maximum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000

Number of rooms required? Beds 1 2 3 4 5 6 7 8+ Baths 1 2 3 4 5 6 7 8+

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ZIP

Enter Zip Code Choose a property type: Residential Rental Income Business Land

What is your price range? No Minimum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000 No Maximum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000

Number of rooms required? Beds 1 2 3 4 5 6 7 8+ Baths 1 2 3 4 5 6 7 8+

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MLS #

Enter MLS Number: MLS Number: MLS Number: MLS Number:

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MAP

Select a Starting Point: No Preference Altamonte Springs Barefoot Bay Brevard Burnsville Cape Canaveral Christmas Cocoa Cocoa Beach Coral Springs Davenport Daytona Beach Daytona Beach Shores Eau Gallie Edgewater Fellsmere Fort Pierce Ft. Lauderdale Grant Grant Valkaria Harmony Holly Hill Indialantic Indian Harbour Beach Kissimmee Lake Helen Lake Mary Malabar Melbourne Melbourne Beach Melbourne Village Merritt Isl Merritt Island Micco Mims New Smyrna Beach Oak Hill Orange Park Orlando Palm Bay Palm City Palm Shores Port Orange Port St. John Port St. Lucie Rockledge Rocklege Saint Cloud Sanford Satellite Beach Scottsmoor Sebastian St Cloud Suntree Tampa Tarpon Springs Tavares The Villages Titusville Vero Beach Viera W Melbourne West Melbourne Winter Park Choose a property type: Residential Rental Income Business Land

What is your price range? No Minimum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000 No Maximum $25,000 $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000

Number of rooms required? Beds 1 2 3 4 5 6 7 8+ Baths 1 2 3 4 5 6 7 8+

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Foreclosures vs. Short Sales

What are the differences?

 First off, let me establish the fact that I am addressing this question exclusively from a prospective homebuyer's perspective. Questions about whether a homeowner can, or should, consider selling their home as a short sale or allowing foreclosure are much too complicated to address in a blog post. Please call me (Jeff Beck) at 866.729.8885 (toll free) or 321.722.9906 (local) to arrange an appointment if you are a homeowner considering those types of scenarios.

The short version

What is a short sale? Technically, a short sale is any real estate sale where the proceeds due to the seller at closing will be insufficient to cover the amount owed plus closing costs and commissions.

What is a foreclosure? Foreclosure is a legal process where a mortgage holder (lender) files suit against a homeowner for failing to make their mortgage payments as promised in the mortgage agreement.

Which is a better deal? Foreclosures are only 9% of the listings, but make up 33% of the closings. They are selling at a rate that is almost 350% faster than average. Short sales make up 30% of the listings, and 18% of the closings. They are selling at a rate that is 60% as fast as the average rate. Foreclosures are almost always the best place to start your search although not always the place where you will end up.

The long version

What is a short sale? Technically, a short sale is any real estate sale where the proceeds due to the seller at closing will be insufficient to cover the amount owed plus closing costs and commissions.

Back before "the bubble", there were occasional short sales where the owner owed too much to cover these costs, in 99% of those cases the owner had to "bring cash to closing". The banks had no interest in taking a shortfall on the amount owed because they did not need to. But when values began to drop, and more homeowners found that they were "underwater" in their homes, the banks began to negotiate settlement amounts. That is how we typically define a short sale today: a home sale where the lender agrees to accept a reduction in the amount owed on a mortgage to facilitate a home sale. One thing to remember here about short sales: in the best case scenario, it is basically a 3 part negotiation. A prospective buyer makes an offer to the homeowner. The homeowner and the buyer must agree to terms and price of the purchase offer, just like any other contract. Then the lender must agree to that sale price/terms... or not. Remember, the bank is losing money on this deal, so just because the buyer and homeowner agreed to a price/terms doesn't mean that the lender will! The lender may accept the contract (really a proposal), ignore it or make a counter offer. Short sales are complicated and usually slow to come together. Typical closing periods are 2-6 months, or longer, or never.

What is a foreclosure? Foreclosure is a legal process where a mortgage holder (lender) files suit against a homeowner for failing to make their mortgage payments as promised in the mortgage agreement. Since the home is collateral for the mortgage loan, the lender has legal recourse and files suit to take possession of the property through the courts. Homes that have been foreclosed upon are called (duh) foreclosures. Purchasing a foreclosure is obviously much simpler than a short sale, because there are only 2 parties to the transaction, the prospective buyer and the lender, who is now the homeowner. Typical closing periods are 4-8 weeks.

Which is a better deal? It depends, obviously every house, deal and negotiation is different. But we can take a little closer look at both types of transactions and some MLS stats and get a pretty clear answer. If you don't like reading, I can give you the very short version => NOT ALL GREAT DEALS ARE FORECLOSURES, BUT MOST FORECLOSURES ARE GREAT DEALS. Why? The difference is in the way foreclosures, short sales and "regular sales" are priced. The pricing on a lot of "regular sales" is determined by the homeowner based on what can kindly be called "alternate homeowner reality". This often involves complicated calculations based on how much they owe, what they need to get to buy something else or what their neighbor's house sold for in 2007. Short sale pricing is often more realistic, because the homeowners typically are highly motivated to make a deal (to avoid foreclosure) and they often don't really care what the sale price is as long as they can walk away and don't have to bring cash to closing. BUT- this situation has also created the biggest problem with short sales, sometimes the asking price is something that the agent or owner basically pulled out of their butt and is unrealistically low, much lower than the lender will ever be willing to accept. Typically, lenders WILL accept offers within 5% of an appraisal or a 3rd party broker's "price opinion" or "BPO". They will usually "counter" offers within about 5% to 10% of the appraised or BPO value. We find that banks will often ignore or counter at full asking price on low-ball short sale offers. They do not feel that you are being serious. Sorry, folks. So, in a nut shell, short sale pricing runs the gamut from stupid high, to spot on, to ridiculously low. And regardless of what price buyer and homeowner agree to the lender has to agree to it for the sale to move forward. This "system" is not conducive to smooth transactions! On the other hand... if you find the perfect house and it's a short sale, there's definitely a chance that we can make it work! Foreclosure pricing is much more clear cut. The bank that owns the home has typically received appraisals and/or broker price opinions (BPOs) from a couple of local professional before putting the home on the market. Banks selling foreclosures typically ask the listing agent for a very aggressive price, typically they push for a price that will "guarantee a contract" within 45-60 days. Occasionally this means that a foreclosure can be priced at below market, because the agents are being pressured to be very aggressive. These homes often set off bidding wars. On the other hand, some foreclosures are priced too high for various reasons. These will eventually be reduced until they sell. Sometimes you can get one of these with a lowball offer... if we can provide documentation to make our case for why the house is priced too high. This brings up one thing that agents and buyers should always keep in mind about foreclosure sales: the seller (the bank) has never seen the property or the neighborhood. All they have to go by is a few pages of numbers (like price per SF, appraised value, and amenities as reported by the listing agent) and perhaps a few pictures and descriptions. If you can show in a couple paragraphs, backed up with hard numbers why the house is only worth (for example) $80k, instead of $105k... you may just convince them.

So what about them stats I promised ya? Let's take a look at single family residential homes sales in Brevard County for the last 6 months. In the past 6 months, there have been 2,692 single family residences (SFR) sold through Brevard MLS. Of those 899 have been foreclosures, that's 33%. Short sales have accounted for 489 sales, which is 18%. There have been 1,304 sales that were recorded as being neither a short sale or foreclosure. That's 49%. Interesting. In comparison, there are currently 3,467 Active SFR listings in Brevard MLS. Of those, 323 are foreclosures, that's only 9%. Short sales account for 1015 listings, or 30% of the total. And 2,528 are entered as being neither short sale or foreclosure for 61%.

So... foreclosures are only 9% of the listings, but make up 33% of the closings. They are selling at a rate that is almost 350% faster than average. Short sales make up 30% of the listings, and 18% of the closings. They are selling at a rate that is 60% as fast as the average rate. "Regular" sales are 61% of the listings, and account for 49% of the closings. They are selling about 80% as fast as the average. The two extremes are foreclosures and short sales. Think about this: on average, there have been 150 SFR foreclosure deals closing per month, current inventory is 323. We have a current active inventory of 2.15 months worth of foreclosures. In contrast, on average there have been 81 SFR short sale deals closing per month, current inventory is 1,015. We have a current active inventory of 12.5 months worth of short sales. Might as well look at the overall average, too. On average, there have been 448 SFR deals of all kinds closing per month, current inventory is 3,467. We have a current active inventory of 7.73 months of single family homes.

So, like I always say... Foreclosures are almost always the best place to start your search although not always the place where you will end up.

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