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Just Ask Julie: Foreclosures and Short Sales

Feb 9, 2015

Julie, my close friends told me to make sure and get a list of all the foreclosures and short sales on Hilton Head before I made a decision about buying a home. But as I look through the listings on your site, I don’t see many and those that I can find seem to not be all that different in price. And when they are, they look like they need a lot of work. I am moving from an area where there are a great deal of foreclosures and short sales available. What’s the current situation like in Hilton Head with respect to foreclosures and short sales?

Answer:

Short Sales and Foreclosures are few and far between in southern Beaufort County. They pop up every now and then but for the most part, those opportunities have peaked and the opportunity rarely presents itself. When foreclosures do pop up, they are usually snapped up within the first week so if you would like us to put you on the foreclosure alert list, please let us know. Foreclosures come “as is and where is” which means that the bank (who is the owner) will not make any repairs or concessions. The banks also price the properties to the market so many times the foreclosure is not as good a buy as one would think. That said, many times you can get a great buy on a foreclosure – it is on a case by case basis.

You should be a bit wary of short sales. They are a bit more plentiful than foreclosures,.  The problem is that there is a long waiting time for the bank to make a decision on an offer and many times the decision they make is not favorable to the purchaser. For example, we represented a client who put in an offer on a short sale and the offer was accepted by the seller, subject to third party approval.  After a long waiting period, the third party (bank) came back with a counter that was higher than the home’s market value. Our clients wanted to continue to buy the home and countered with a higher price than their original offer and provided pertinent information on the market to back it up.  It went back in for consideration and by the time we got an answer back, interest rates had risen and the price the bank answered with was still higher than what the buyer wanted to pay. This was after a year and a half of waiting and the buyer decided that it was more trouble than it was worth, and ended up purchasing another home. (Those negotiations started in 2012 and the house has still not closed, although it is under contract with another buyer).

I hope that helps. If you would like to give me a call, I would be glad to discuss this with you further or answer any of your other questions!